The point-factor method is the most commonly used method of job evaluation, which involves using specific factors to evaluate job worth. It is also referred to as the Hay Plan. It is an analytical, factor-based scheme, which aims to measure the relative size of jobs within an organization. The method is based on the following primary factors:
1. Know – How
The level of knowledge, skill and experience (gained through job experience, education and training), which are required to perform the job successfully. This is commensurate with the scale and complexity of the job outcomes (accountability).
2. Problem Solving
The complexity of thinking required, both in the type of problems come across and the extent to which the jobholder has precedent and/or assistance in solving them (applying their Know – How).
The impact the job has on the organization (i.e. the end result) and the extent to which the jobholder acts autonomously in achieving this.