Job Classification

What is Job Classification?

The purpose of a job classification system is to organize all of an organization's occupations into a hierarchical structure that can be compared and contrasted based on factors like the amount of responsibility, salary, and other benefits. For internal consistency and clarity, many businesses give grades or categorization levels to each position.

The ultimate purpose of a company's job classification system, regardless of its specific form, is to identify roles and responsibilities appropriately. It is also useful for organizations in the same sector to compare job descriptions for identical positions at other firms. So, a job classification system does not consider the incumbent's degree of expertise but the necessary level for the job. 

What Does Job Classification Mean?

The purpose of job classification is to define the functions of various positions within an organization. It may be used in various ways, including job postings, evaluating employee performance, and identifying potential areas of employment overlap. The job classification system aims to provide uniformity inside an organization and across businesses in a given industry and to provide a means of understanding how roles and responsibilities are defined within a certain firm.

Why is Job Classification Important?

Take a look at an example of job classification to fully understand what it means and why it's important to a company. The Hay System is a common way to group jobs and can help you better understand how jobs are grouped. The Hay System divides jobs into three groups:

• What you need to know to do the job
• The job requires them to solve problems.
• The responsibility that comes with the job

The Hay System then uses this information to determine if this job and similar ones in the company have the same responsibilities and pay.

The Hay System sets a standard for all jobs in a company and helps determine what needs might be there. It ensures that each job is paid fairly based on the duties of that job and the duties of other similar jobs.

What are the Advantages and Disadvantages of Job Classification?

One of the benefits of job classification is that similar jobs can be grouped. It can help improve the workflow and determine if some groups' tasks can be split up within the company. It can help make a broad-based pay structure, which means that pay grades are combined into a smaller number of pay ranges. On the other hand, Wider pay ranges let an employer give pay raises to workers without promoting them. With a job classification method, this is only possible if the boss knows what jobs are being done in the company.

One problem with job classification is that the data pools are small because they only apply to the company that made them. It means that when a company offers a new job, you can only compare it to the jobs that already exist in the company. For every new job that was made, every job would have to be re-evaluated. Because of how many people are involved, decisions about classifying a job are subjective to the person doing the judging, who may not understand the benefits and importance of a certain job. To get a better idea of what the job is like, it can be helpful to have someone who is already doing it write down a description of the skills they use and the tasks they do.

What is a Job Classification system?

As the goal of classification is to make clear comparisons, it usually uses a structure of job functions, families, and jobs.

In job classification, it's important to remember that the job, not the person, is being judged. People can do the same job simultaneously, but each does it in their way.

Every job belongs to a family, and each family belongs to a function. So, the job classification makes intuitive sense and makes it easy to put existing and possibly new jobs into the right category whenever needed. As was already said, it is also the basis for many HR policies.

What are the examples of Job Classification?

There are many ways to develop the various job functions and job families. But there are standard ways to deal with them.

Common job families include operations, marketing, sales, human resources, finance, research and development, sales, customer support, shared services, and so on. The job functions are set by the things happening in the family.

What is the Job Classification method?

Now that you know the basics, it's easy to determine how to classify jobs.

Classification means classifying a job based on its traits and the classifications we've already discussed. Most of the time, the job description is the input, but it may already be available. Next, you can: (i) figure out the job family, (ii) figure out the job function, and (iii) figure out the job itself based on the job description.

A common job hierarchy is given, followed by notable organizations :

There are also senior and junior positions above and below this one. For instance, a junior director will have a different rank than a senior director, just as a senior vice president will have a higher rank than a regular vice president.

As you can see below, each function comprises the same job family. Most organizations are shaped like a pyramid, with fewer jobs at the top and more at the bottom. This picture does not show all the jobs.

The goal of classification is to ensure everyone gets paid the same amount. It is based on the method shown above. But this doesn't mean the Human resources analyst will be paid the same as a financial analyst. It is also affected by the supply and demand of jobs, their responsibilities, and other things.

What is some Job Classification Criticism?

There is some common criticism about how jobs are classified.

1. A step above the rest

Many jobs have responsibilities to go beyond their "class." Take a worker who has become a team leader over time even though they don't have the title. In a strict classification system, there is no way to pay this employee for the extra work without giving them a promotion (which they may be ineligible for). Position classification shows down advancement. Talent can't move up quickly because of job classification, either. 

2. Standards are outdated

Many standards were set in the 1990s and haven't been changed since then. Job evaluation can take years and costs money. It means that the system doesn't consider changes in job responsibilities. There used to be a communist classification system in Russia from when the country was part of the USSR. After the USSR parted ways, many companies kept using that framework, as many roles and classifications can be traced back to it.

3. Failure in hiring top talent

Organizations with complicated classification systems may not be able to find and hire rare talented people. Because there's much competition in the private sector, it is hard for the government to huff cybersecurity experts for data scientists. Because entry-level jobs' pay is based on the system already set up, it's hard to compete for these important workers.

4. Group Bargaining

From an employer's point of view, job classification is just the tasks an employee does and how much they get paid for them. It will lead to a system where they are mostly middle, there aren't many ways to reward top performers, and there aren't many entry-level jobs. It goes against why the employer started classifying jobs in the first place.

But on the bright side, job classification does provide a framework for normal workers and a fairly clear way to move up in their careers. It also keeps the employee from asking for a higher salary than they are worth to the company. With this in mind, classifying jobs may be the least bad way to set pay up.

FAQ

1. Why do we have a job classification system, and what purpose does it serve? 

We have a job classification system to precisely evaluate jobs and determine which job suits an individual best.

2. What is the purpose of job classification?

Job Classification creates a stable pay-scale, employee satisfaction, and complete knowledge regarding an individual's job.

3. What is the major advantage of the job classification method?

It prevents workers from discrimination charges and provides stability.

4. What is Job category level?

Job Categories are the nature of the employment itself.

5. What are the job categories levels?

There are three categories of levels 1) Operational and technical, 2) Professional, 3) Supervisory and Managerial.