Building trust, fairness and career growth with job evaluation frameworks

As the EU Pay Transparency Directive deadline looms, employers have time to take one last look at whether their pay decisions are objective, consistent and gender-neutral.

EU member states have until June 7 to translate the EU Pay Transparency Directive into national law. Whilst the UK does not fall under this pending legislation change it does signal a clear direction of travel which is still showing in different ways within the UK.

LinkedIn market research has shown that that the younger generations expect transparency in terms of pay and are significantly more comfortable and more likely to share information about their pay than previous generations.

Research by ADP has also shown that employees who feel their pay is fair are four times more likely to be fully engaged.

Whether it is being driven by legislation changes or simply a desire to show employees that pay is set equitably, criteria are needed to underpin these decisions. The most robust of these is a job evaluation framework, and whilst the EU Directive doesn’t mandate a formal framework, many employers are choosing to adopt one to ensure decisions relating to pay are based on objective, consistent and gender-neutral criteria.

There are, however, other benefits to implementing a job evaluation framework other than compliance with legislation.

1. Employee trust and confidence

Being able to demonstrate to employees that there is objective and non-discriminatory criteria behind what salary band they are in, what bonus opportunity they have, what employer funded pension contribution they receive is a foundation to building trust with employees.

Employees who have confidence that their pay is fair are more engaged and research has repeatedly shown that higher engagement levels correlate with higher productivity measures like revenue per employee or task completion rates.

2. Supports effective organisational design

An effective job evaluation framework helps differentiate roles based on the value they bring to the organisation based on factors such as expertise, complexity, impact and resource management.

Bringing clarity to the different levels within the business and where roles sit helps to identify unnecessary layers of management, along with gaps in management layers, bottlenecks, large or small spans of control and unclear reporting lines. This enables HR teams to work with leaders to optimise the design of roles and hierarchy across the organisation to remove challenges that these issues may create.

3. Supports workforce planning

Having clarity on the right organisational design then feeds into effective workforce planning. Organisational design is about having the right roles in the right places at the right level, and by overlaying the skills and capability of individuals enables effective workforce planning for short term and long term.

Initially, it’s worth analysing where there are skill gaps within the organisation. Where is there misalignment between the skills of the individuals and the skills needed in those roles? Where is resource too heavy or too light to meet current demand?

Looking further ahead, what skills will the business need in the future and how well do they align with current skills? How might demand change and what impact will that have on resource?

4. Supports career pathways

Providing a clear framework and hierarchy of roles enables employees to see career pathways and opportunities within the organisation. It helps employees understand where there might be promotional opportunities, but also lateral or diagonal moves that will use their transferable skills.

Effective workforce planning also enables the business to support employees in developing skills the business will need in the future, and potentially opening them up to opportunities they may not have considered. This supports succession planning, and in a world of increasing “openness” through social media, making career pathways more visible to your employees can help retain key talent.

It can also help prevent “LinkedIn Envy”, where employees seek development opportunities elsewhere to keep up with the perceived career advancement of their peers through social media.