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FromJob Classification

toPerformance and Compensation

Management

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Job Evaluation

2 major objectives:

1. Establish a logical hierarchy of jobs

2. Establish the proper relative distance

between jobs within the hierarchy

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The common elements of Job

Accountability

Know How

Problem Solving

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The common elements of Job

Accountability - Job exists to achieve end results

Know How - To carry accountability job holdersneed to be equipped with a fund of skills andexperience

Problem Solving - In utilizing know-how toachieve end results job holders must address

and resolve problems

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Evaluation Criteria

The KNOW-HOW required to SOLVE thePROBLEM and achieve results forwhichit

is ACCOUNTABLE

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Hay Job Evaluation

Know-How score in Hay Points

+

Problem Solving score in Hay Points+

Accountability score in Hay Points

=

Job Evaluation in Hay Points

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Job Class System

Job Class Sub-class Hay Points Range

A

B

C

D

E

A-1

A-2

A-3

B-1

B-2

B-3

C-1

C-2

C-3

D-1

D-2

D-3

E

275 - 350

351 - 425

426 - 500

501 - 550

551 - 600

601 - 675

676 - 765

766 - 870

871 - 985

986 - 1080

1081 - 1185

1186 - 1300

1301 and above

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Performance Management

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Best practices in PerformanceManagement

TheFunctions

OfAppraisals

CoachingAnd

Guidance

Feedback

AndCommunication

CompensationAnd

Reward

Termination

AndLegal

Obligation

StaffingDecision andProfessionalDevelopment

Improvement

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Performance ManagementProcess

Step one: Performance Planning

Step two: Interim Reviews of Progress AgainstObjectives . Providing feedback and coaching

Step three: Conducting the FormalPerformance Review.

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Performance ratingdistribution

0%

10%

20%

30%

40%

50%

60%

Rating 1 Rating 2 Rating 3 Rating 4 Rating 5

Top 100 companies

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Objectives of CompensationManagement

Internal equity

External competitiveness

Affordability

Recognition Motivation

Legislative compliance

Proper communication Continuous review

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Compensation Principles

Performance-based pay

Competitive pay

Ownership Leveraged pay

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Elements of Total Compensation(TCM)

Base Salary

Annual Incentive (AIP)

Stock (LTIP) Special Rewards

Benefits

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Base salary increaseconsiderations

How has the employee performed ?

How does the performance compare tothat of their peers ?

Where does the employees salary fall inthe salary range ?

How does the salary compare to that oftheir peers ?

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Merit Increase Guidelines

1

2

3

4

5

Ratings

SalaryRange

Compa-Ratio

Entry Market Premium

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D9

Q3

Med

Q1

D1

0

20000

40000

60000

80000

100000

0 200 400 600 800 1000 1200

Hay Point

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7/1/2013 18

Merit Increase GuidelinesCountry

Inflation % Source

40,000

12% 10% 8%

10%80,000

8% 6%

8% 6% 4%

6%60,000

4% 2%

0% 0% 0%

Ratings

Salary Range Entry Market Premium

65% - 85% 85% - 115% 115% - 135%

OUOutstanding

VGVery Good

GDGood

AVAverage

PRPoor