Job evaluation is a procedure for developing a wage structure that is somehow based upon an evaluation of the job. It is a systematic way of determining the value/worth of a job in relation to other jobs in an organization. It tries to make a systematic comparison between jobs to assess their relative worth for the purpose of establishing a rational pay structure.
“Job evaluation is the process of determining the worth of various jobs within the organization is that differential wages may be paid”. (Wendell French)
Job evaluation needs to be differentiated from job analysis. Job analysis is a systematic way of gathering information about a job. Every job evaluation method requires at least some basic job analysis in order to provide factual information about the jobs concerned. Thus, job evaluation begins with job analysis and ends at that point where the worth of a job is ascertained for achieving pay equity between jobs.