RECRUITING
What Is Job Classification & Why It's Important
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Feb 17, 2023
Job classification can be a powerful standardization tool, allowing you to cover every area of need in your business more effectively than manual audits can. Understanding how to leverage this in your business offers you the opportunity to foster improvement, general efficiency, and a greater degree of organization that every team member can benefit from.
Below, we’re exploring what job classification is, how it works, a sample system, and a pro/con analysis of using this tool in your business.
What is job classification?
Job classification determines where a set of jobs falls on a hierarchy, defining and assigning a “rank” for every role. This process keeps requirements specific to a certain level of role, ensuring a more equitable experience for both employer and prospective team member.
Job level classification can also help to assign certain echelons of pay and rate, which can save HR team members time on the back end for job description creation and management.
How does job classification work?
The process of job classification can be done with any HR professional in your company. The human resources specialist can complete a comprehensive evaluation of a role’s scope and duties, summarizing it effectively for stakeholder approval. At this point, there may be a group discussion to determine which echelon of compensation a certain job fits into until an agreement is reached.
After this determination is made, HR can then create the job description and path to advancement that is appropriate for that specific level of the job. It can also be used to improve the employee onboarding process, presenting all information regarding the role in a clear, succinct, and reliable manner.
Job classification system(s) in the workplace
A clear example of job classification in action can be seen when comparing the roles of an employee to those of managers or executives. Team members that have not yet reached manager level may be compensated on an hourly basis, with a limited package of benefits that apply both in and out of the workplace (such as tech allowances, health and wellness funds, and full-spectrum healthcare coverage). The budget would be set to reflect their roles, which may include administrative work, light specialty services, or reporting tasks.
Managers, on the other hand, may be expected to manage a medium to large-sized team — which generally comes with advancement in pay. This can be reflected either on an hourly or a salary basis. They may also be eligible for a more advanced suite of benefits, depending on the company type, status, and expectations of the role.
Finally, executives serve as one of the roles that stand in stark contrast to the team member role, generally being classified as a role with higher pay, an intense scope of work, and full-scale benefits in every possible area. In alignment with this, however, there may be certain performance expectations or specialized knowledge that isn’t required in other roles that lie lower on the hierarchical structure.
Understanding these differences through the lens and scope of job classification is essential to inspiring a fair and equitable workplace experience.
Pros and cons of classification
While job classification can seem like a more obvious solution for up-and-coming businesses, it’s important to consider possible advantages and disadvantages to ensure that you’re getting the most possible benefit for your current state of business.
A possible advantage of using job classification in your HR process is the streamlined workflow that it can bring to human resources professionals as they navigate recruitment steps. This is done in parallel to drafting HR policy and building a strong onboarding process. Consolidation of pay structure can make compensation simple and erases opportunities for risk that may be present with less standardized methods.
A possible disadvantage, however, is the lack of exterior data that can influence this process. This leaves room for subjectivity — which is why having transparency around this process is critical for successful implementation and adaptation. Additionally, rigidity in this process can lead to “disconnects” between employee expectations around role and scope, especially as we continue to see monumental shifts going into the post-Great Resignation era.
Consulting stakeholders at every step of the process and maintaining an employee-forward process at all times can help you to make job classification a helpful resource in your business.
Connect with Bambee today for job classification support
Looking to streamline your HR process for job classification, HR policy creation, and ongoing audits? Connect with the team at Bambee today. Our experts are here to provide custom HR support, starting at just $99/month.
