What is the process of evaluating and rating jobs within an organization for wage purposes?

The process of evaluating and rating jobs within an organization for wage purposes is known as job evaluation. This systematic approach helps organizations establish fair and equitable pay structures by analyzing the relative worth of various jobs in relation to each other.

In job evaluation, factors such as the complexity of the work, required skills, responsibilities, and the impact of the role on the organization are taken into account. This allows employers to assess how much each position should be compensated in comparison to others, ensuring internal equity and competitiveness in the labor market.

Understanding this process is crucial for maintaining employee satisfaction and motivation, as well as adhering to legal standards and best practices in compensation management.