Risky business: how does Risk feature in job levelling?

Among other factors, complexity, authority, impact, and context can all influence the level of risk for a role, and, therefore, its size and seniority. The following explains some of the key elements which we consider when developing job levelling frameworks or conducting job evaluations.

Decision-Making Authority

The more senior a role the more profound and significant its critical decisions will be, and the more intense its level of possible risk. The outcome of these choices may have a crucial impact on the organisation, its internal and external stakeholders, and its financial or operational status.

Senior roles with more strategic impact must make decisions that affect the organisation’s long-term performance and success. This higher level of strategic and operational responsibility can mean that consequences are larger and longer lasting, and therefore riskier.

Complexity

When roles contain a deeper level of complexity, they often carry for potential for incurring increased risk. This may include managing multiple complicated projects or overseeing large teams. To manage intricacy and complex processes, a role holder needs an equally advanced level of strategic understanding to mitigate potential risks.

Accountability

Different types of roles have different levels of accountability; junior roles are often less accountable as they do are not required to make impactful, strategic decisions.

Senior roles usually have more accountability because their actions can incur legal, financial, and reputational consequences and increase the degree of risk when things do not go to plan. Reputational risk is also a vital concern for an organisation. When senior role holders are representing the organisation, their actions and decisions can have significant repercussions which need to be borne in mind.

Context and Externalities

Context is connected to risk, and exposure to external factors can introduce more variables and complexity to a role. These contextual elements may be difficult to control, such as economic fluctuations or complicated compliance issues that could disrupt resource management. The particular sectoral or market contexts in which an organisation or role is situated are also linked to risk.

What are some of the key elements and benefits of job evaluation?

Job evaluation aims to be an unbiased process based on an objective assessment of specific job criteria, rather than subjective biases. Pay equity can be established by ensuring that similar jobs receive similar compensation, regardless of factors such as gender, race, or personal relationships.

Job evaluation focuses on job-related factors such as skills, knowledge, experience, and responsibility. This requires a thorough analysis of the role: its duties, qualifications, responsibilities, and the context in which it operates.

All the roles are important, equally so. But what we are trying to do here is differentiate between the roles, fairly, so we can make balanced decisions about pay. Job evaluation is a fair way to understand the size, level, and pay of different roles.

The subjective judgment element becomes clearer if we think about gender too. Societally, there is a whole range of views about the worth of jobs which are related to the historic gender predominance of certain jobs e.g., Nurse or Carpenter. Job evaluation is vital approach for resisting subjective bias of particular roles.

One of the Golden Rules of job evaluation is that it is about assessing the role, not the person. The performance, skills, capabilities of the role holder should not be taken into account.

For example, if the role holder is performing the role of an Administrator, but in fact has the qualifications to be a Brain Surgeon, this has no relevance to how the role is sized. The role needs to be assessed at the level shown on the role profile.

The key elements and benefits of Job Evaluation

What job evaluation is not…

The following is a list of the common misconceptions about what job evaluation involves or represents. Job evaluation is NOT:

  • A way of measuring the worth of jobs (the salary does that): Job evaluations informs the relative placement of the role within an internal organisation based on complexity etc. Once it is graded and evaluated the salary itself is already there to be applied based on pay structure.

 

  • A measurement of hard work or overwork: Job evaluation does not measure how good someone is at the job.It’s important not to measure overwork: it’s easy to do, but crucial to avoid. To offer a reward/pay rise based purely on diligence can be imperfect. In a perfect world, an employee should be promoted or if they are overworking or there this might reveal an understaffing issue.

  • A pure science: The foundation of job evaluation is that it is all about consistent decision-making, rather than infallible decision-making. That’s why panel-based evaluation is important because there is a discussion and a logical approach that includes consistency checking as well as speaking to the organisation’s relevant parties for their view on job descriptions, for example.

  • Meaningful by itself: Job evaluation needs to be attached to the salary structure. It is the salary structure that tells you what the amount of pay is – job evaluation simply gives you the information to put the role in the right grade.

 

  • The same as performance evaluation: Job evaluation focuses on the inherent “value” of a role in and of itself, whereas performance evaluation is concerned with assessing an individual employee’s performance and contributions.

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