What is an example of a compensable factor that can be used by point job evaluation systems?

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True / False

1. The final step in developing a job evaluation system using a point method requires that the job hierarchy scheme meet certain criteria, including validity and market fit. a. True

b. Fals e

ANSWER:  True

1. Job evaluations help to establish internal equity. a. True

b. Fals e

ANSWER:  True

1. Under pay equity legislation, organizations need to evaluate three out of the four main categories of compensable factors in evaluating jobs. a. True

b. Fals e

ANSWER:  Fals e

1. The two methods for deriving factor weightings are statistical analysis and expert judgment. a. True

b. Fals e

ANSWER:  True

1. Reliability of the job evaluation system means that the system will produce the same results even if different evaluators are used. a. True

b. Fals e

ANSWER:  True

1. The primary drawback associated with using the point method of job evaluation is that it provides an illusion of a scientific process when in fact the method relies significantly on the judgment of evaluators in selecting appropriate weights a. True

b. Fals e

ANSWER:  True

1. Broad banding results in fewer jobs in a pay grade. a. True

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Chapter 8 - Evaluating Jobs: The Point Method of Job Evaluation

b. Fals e

ANSWER:  Fals e

1. A pay grade is the same as a pay range. a. True

b. Fals e

ANSWER:  Fals e

1. A living wage is the same as the minimum wage. a. True

b. Fals e

ANSWER:  Fals e

1. One possible solution to excessive pay scale overlaps is to ensure that the maximum pay in a lower scale is less than the midpoint of the next higher pay scale a. True

b. Fals e

ANSWER:  True

Multiple Choice

1. Which of the following is NOT a component of the point method of job evaluation? a. compensable factors

b. total points

c. factor degrees

d. competencies

ANSWER:  d

1. What is generally NOT considered an advantage of the point method of job evaluation? a. It gives the relative value of jobs.

b. It helps to establish internal equity among jobs.

c. It helps to establish market rates for jobs.

d. It has a high degree of precision.

ANSWER:  c

1. Four main categories of compensable factors are used widely in industry. Which of the following could be included in the skill category?

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Chapter 8 - Evaluating Jobs: The Point Method of Job Evaluation

c. degree 3: three year college diploma or university degree d. degree 4: completion of grade 9

ANSWER:  d

1. Two thousand points are distributed between compensable factors, based on the following: education 750 points, time pressure 350 points, customer contact 500 points, and communication skills 400 points. Which step in developing a job evaluation system using the point method recognizes these variations in importance? a. defining the factors

b. weighting the factors

c. scaling the factors

d. testing the system

ANSWER:  b

1. Which approach for deriving factor weights tends to be seen as being rather complex and difficult to understand? a. the “a priori” method

b. the statistical analysis method

c. the testing and functional method

d. the benchmark scallion method

ANSWER:  b

1. After several evaluators apply the job evaluation system to a heavy-duty mechanic job, you find significant discrepancies in the weights associated with each compensable factor. What is NOT likely to be a reason for the discrepancies? a. factor definition being used by the evaluators

b. job information provided to the evaluators

c. evaluators using the wrong benchmarks

d. degree of definition provided to the evaluators

ANSWER:  c

1. In calibrating job evaluation results with the market, we select “key” organizational jobs for market comparisons. What are these “key” jobs called? a. benchmark jobs

b. market comparators

c. market calibrators

d. compensable jobs

ANSWER:  a

1. After plotting a regression (market line), you determine that the slope is very steep. What possible conclusion can you make from observing the slope of the regression line? a. The correlation coefficient is approaching –1 (negative one).

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Chapter 8 - Evaluating Jobs: The Point Method of Job Evaluation

b. There is too much spread in job evaluation points between low-value and high-value jobs. c. There is not sufficient spread in job evaluation points between low-value and high- value jobs.

d. Lower-value jobs appear to be compensated above market rates.

ANSWER:  c

1. What does the market line determine? a. whether the firm should lead, lag, or match the market

b. the relationship of job evaluation results to market pay rates

c. the relationship of job evaluation results to a firm’s pay grades

d. a pay rate based on a market survey

ANSWER:  b

1. What does a –1 (negative one) correlation coefficient mean? a. There is a positive relationship between job evaluation points score and pay levels.

b. There is an inverse relationship between job evaluation points score and pay levels.

c. Your regression equation has a very steep upwards slope.

d. There is very little relationship between job evaluation points score and pay levels.

ANSWER:  b

1. In exploring solutions to job evaluation problems, what is NOT one of the main steps? a. Check that benchmark jobs are equivalent to market comparator jobs.

b. Determine if the wrong factors have been included in the job evaluation system.

c. Adjust the point totals of the outlier jobs to improve the correlation coefficient.

d. Examine whether jobs have been badly evaluated.

ANSWER:  c

1. The textbook identifies four possible pitfalls associated with the point method of job evaluation. Which category of pitfalls would include a situation whereby the factor is poorly defined, creating a situation in which the evaluator is not clear what the factor is designed to pick up? a. hierarchical grounding

b. factor overlaps

c. gender bias

d. inconsistent construct

ANSWER:  d

1. What does the correlation coefficient of the market pay line tell you? a. “goodness of fit” between the job evaluation points and market pay

b. pay equity adjustments to be made

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Chapter 8 - Evaluating Jobs: The Point Method of Job Evaluation

1. Which term refers to the actual minimum and maximum pay rate, in dollar terms, for all the jobs that fall in a particular pay grade? a. pay range

b. broad banding

c. market anchor

d. step progression

ANSWER:  a

1. What is a negative consequence of clustering jobs into pay grades? a. Pay grades make it difficult to justify and explain pay rates to employees.

b. Pay grades create less stability for the pay system.

c. There may be pressure to reclassify borderline jobs or to promote people to get more money.

d. Similar jobs are grouped into the same grades.

ANSWER:  c

1. Which of the following is an inevitable outcome of broad banding? a. There are increased labour costs, as everyone is paid more for specific jobs.

b. It decreases the level of flexibility within the pay grades.

c. It tends to lead to “skinny” pay grades.

d. Jobs with significantly different scores end up in the same “band.”

ANSWER:  d

1. Which statement best explains how to establish pay grade sizes using the equal interval approach? a. Look for natural breaks between clusters of jobs when setting up the grades.

b. Increase the grade widths for higher-value jobs but not necessarily by an equal percentage.

c. Reduce the number of pay grades by creating large bands.

d. Make the point spreads equal for all pay grades.

ANSWER:  d

1. The pay policy line is used to establish which pay structure component? a. midpoint of the pay range

b. range spreads

c. overlaps between ranges

d. pay grade size

ANSWER:  a

1. Which statement best reflects the relationship between the minimum wage and a living wage? a. They are the same.

b. A living wage tends to be higher than the minimum wage.

c. The minimum wage tends to be higher than a living

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Chapter 8 - Evaluating Jobs: The Point Method of Job Evaluation

wage.

d. A living wage is two times the minimum wage.

ANSWER:  b

1. Which practice is a threat to the integrity of the job evaluation system? a. wider pay grades as the system goes up

b dollar differences between the range midpoint and the range minimum, and between the range midpoint and the range maximum

c. wider range spreads for higher pay grades

d overlaps between pay ranges

ANSWER:  d

1. After reviewing pay ranges for your organization, you realize a significant number of pay ranges do not overlap or do not connect. For example, the maximum of the pay range for pay grade number 2 is $50,000 and the minimum range for pay grade number 3 is $60,000. What is a potential root cause of this issue? a. Ranges are too narrow and/or there are not enough pay grades.

b. An equal approach method was used to establish pay grades.

c. An equal percentage method was used to establish pay grades.

d. Poor benchmark jobs were used to establish pay grades.

ANSWER:  a

Subjective Short Answer

1. Identify and briefly describe the main steps in developing a job evaluation system using the point method. ANSWER :

The main steps in developing a point method of job evaluation system are as follows: identify the compensable factors, scale the factors, weight the factors, and apply and test the system. Appropriate compensable factors are those characteristics of jobs that are valued by the organization and differentiate jobs from one another. The four main categories of factors include: skill, effort, responsibility, and working conditions. Scaling involves breaking down the factors into major categories (i., universal factors, sub-factors, and degrees or levels). In “scaling the factors,” the objective is to create a scale for each factor that reliably measures the extent to which that factor is present in a given job. Determining the relative weight for each factor is based on how the organization values each factor. Although it can be done statistically, this is very rare, and it is generally a judgmental process. Once the weightings are determined, points are assigned across factors, sub-factors, and degrees. The total point value of each job is determined using the system. The resulting hierarchy of jobs is tested to determine validity (i., if the system is actually a true measure of relative job worth) and for reliability (i., if the results come out the same when the system is applied by different evaluators). If so, the system must then be calibrated to the market, using benchmark jobs and market comparator jobs. This provides the opportunity to test for market fit, as well as testing for other potential problems.

1. Discuss the advantages and disadvantages of the point method of job evaluation.

ANSWER :  

The advantages of this system include a high degree of precision in measuring jobs; it’s easy to apply with consistency; it provides an ordering of jobs and relative value of

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