Job Evaluation is a systematic and orderly process of determining the worth of a job in relation to other jobs. The objective of this process is to determine the correct rate of pay. In simple worlds, job evaluation is the rating of jobs in an organization. It is the process establishing the value or worth of jobs in a job hierarchy that compares the relative intrinsic value or worth of jobs within an organization.

The objectives of job evaluation are as follows:

1. Establishing a standard procedure for determining the relative worth of each job in an organization.
2. Ensuring equitable wage for a job.
3. Determining the rate of pay for each job which is fair and equitable with relation to other jobs in the plant, community or industry.
4. Eliminating wage inequalities;
5. Providing a benchmark for making career planning for the employees in the organization and;
6. Ensuring that equal wages are paid to all qualified employees doing the same work.

There are 4 fundamental Job Evaluation techniques:

1. Ranking Method
2. Factor Comparison Method
3. Classification Method
4. Point Plan Method

1. Ranking Method

The ranking method is the most basic form of job evaluation. In this method, each job as a whole is compared with other and this comparison of jobs goes on until all the jobs have been evaluated and ranked. All jobs are ranked in the order of their importance from the simplest to the hardest or from the highest to the lowest.

Following steps are necessary to facilitate the ranking method of job evaluation:

1. Obtaining information about the job - Job descriptions for each job are prepared and these are the basis on which the ranking s are made.

2. Rating of jobs - Ranking all the jobs, at a time, is usually not possible. The more usual procedure involves ranking jobs according to the department.

3. Ranking jobs - The simplest way of ranking jobs involves giving each rater a set of index cards, each of which contains a brief description of a job. These cards are then ranked from lowest to highest.

4. Combining Ratings - Usually, several raters rank the jobs independently. The jobs are divided and the ranked jobs are placed into appropriate groups by considering the common features. All the jobs within a particular group or classification receive the same wage or range of raters. Once this is achieved, the jobs are ranked according to its mean ranking.