What Is Job Leveling? 9 Implementation Steps To Take in 2024
Job leveling is an essential part of organizational design as it demarcates responsibility of work to be done at various levels. This has an impact on decision making, accountability and execution. For individual career development, it creates clarity around opportunities for advancement and the exact requirements at various levels, if defined well as part of organizational design.
In this article, we will further unpack what is job leveling, offer examples of a job leveling framework and provide 9 steps for implementation in your organization.
Let’s begin!
Contents
What is job leveling?
Job leveling examples
The importance of job leveling
9 Steps for implementing job leveling
What is job leveling?
Job leveling is a system that defines an organization’s roles, corresponding job descriptions, responsibilities, career paths, and compensation ranges. Many HR professionals might recognize this term by another name — job classification.
Setting a job leveling framework helps organizations group similar job types and sets comparable qualifications and compensation for those roles across the organization. For example, in a university setting, a job level framework would show the competencies for an IT Professional across campus, from central administration to student housing.
What makes up a job leveling framework?
Some of the key components of a job leveling framework include:
- Job levels: These are the different categories of responsibility and leadership within the organization, from employees all the way up to executive management.
- Competencies: These are the skills, knowledge, abilities and expertise necessary to do each job. They include things like communication, teamwork, and problem-solving.
- Responsibilities: These are the necessary tasks and duties for a role.
- Compensation range: This can include the starting pay to the maximum amount an organization is willing to pay for a specific job.
Job leveling examples
Job leveling is relevant to every job type. The following job leveling matrix shows how roles within the communication team have been outlined, with their various responsibilities. This also gives an indication of what career progression might look like within the team.
Title: Communications Coordinator
Notes: Entry level. Assists with the development and execution of department communication strategies and deliverables. Provides support to the communications management team.Title: Communications Manager I
Notes: Mid-level. Begins to be responsible for specific areas of the department’s communication strategy. Provides support to the senior communications management team.Title: Communication Manager II
Notes: Senior level. Responsible for all areas of the department’s communication strategy. Leads lower-level communications team members and provides support to the Senior Communications Manager.Title: Senior Communications Manager
Notes: Senior level. Responsible for setting strategy for the department’s communications and communications data and analysis. Provides communications support to the department executive management team.
Here is a further example of how the above job leveling would work:
Rose started a communications position at a new organization recently. While she had worked in a similar job at another company for a couple of years, this was a lateral move for her. Rose is starting as an entry-level Communications Coordinator. During her performance review and goal setting after her first year, she and her manager set a plan for key areas she could focus on in the next performance cycle to get promoted to the Communications Manager I level. They had regular check-ins throughout the year to gauge her progress and make necessary changes to her goal-setting or corresponding tasks in order to reach her goal of promotion.
At the time of her next annual review, Rose’s supervisor determined she had achieved her goals and was now doing the work of a Communications Manager I. If Rose decides to continue working at this organization or in this specific department, she will follow the progression of the communications professional role.
The importance of job leveling
It might seem like a no-brainer for an organization to have job leveling, but a survey by Monster found that 80% of workers do not think their current employer offers growth opportunities. In addition, 29% of workers named lack of growth opportunities as their reason for wanting to quit.
Job leveling provides a clear path for employees to know what their roles and responsibilities entail and their fellow workers. This can help with recruiting, performance reviews, and employee retention. Let’s take a deeper dive into some reasons job leveling is important:
- Clearly defined roles and responsibilities: Employees know not only what is expected of them in their existing role but also what competencies they need to achieve to be promoted and progress through an organization.
- Smoother recruitment processes: A clear path forward can help streamline the recruitment process and make filling vacancies with the best candidates more quickly. Deloitte Consulting conducted an analysis on Generation Z, one of the newest generations in the workplace. They found that Gen Z expects personalization in their career path, with a key focus on training, leadership development opportunities, and tangible work on diversity.
- Setting performance standards: A job leveling matrix that is well thought out and up-to-date can help the performance review process. Both supervisors and employees will know what the expectations are.
- Employee retention: Employees can feel stuck without a path forward, which can lead to more turnover in an organization. Job leveling helps employees, supervisors, and organizations at large see clear career paths for each job type.
- Better alignment with diversity, equity, inclusion, and justice initiatives: A well-structured job leveling system can help an organization create and adhere to more DEIJ hiring and employment practices.
These are just a handful of key aspects a job leveling framework can bring to an organization, but there are many more!
9 Steps for implementing job leveling at your organization
Now that we have a better idea of what job leveling is and why it’s important, let’s talk about how an organization can implement it.
Most organizations start small and grow organically over time, making a job leveling framework seem unnecessary in the early phase. This means that many organizations need to implement job leveling later on, which can feel daunting and complicated. The following nine steps can help for a smoother process for implementing job leveling.
1. Understand your organization’s unique needs
Job leveling should be closely linked to the organizational design and structure – these are critical inputs to take into consideration.
2. Get leadership buy-in
Having a great job leveling matrix in place is only half the battle. In order for it to be successful, the leadership team must buy into its importance. Ensuring proper leadership buy-in can also help with proper resource allocation in developing the system.
Make sure to explain the benefits of the system very clearly to the organization’s leaders. Beyond buy-in, leaders across the organization provide important input into the requirements for roles across various levels
3. Define criteria for leveling
Setting clear and objective criteria for categorizing jobs, responsibilities, required skills, and their corresponding impact on the organization before developing the framework is key. These will help guide the rest of the process and answer questions that may arise.
4. Develop a job leveling framework
Next is the time to develop the actual framework. Create a structured system that categorizes jobs into different levels based on the defined criteria. It is also important that this is aligned to the compensation philosophy (or grading) at this point, and the extent of impact is understood.
Another consideration is market comparability of your job leveling – this impacts compensation but also recruitment, development and progression. Below is a simplified version of a job leveling framework for roles in a finance department:
Job Level Job Title Competencies Responsibilities Compensation Range Level 1 Administrative Assistant – Communication – Office tasks and coordination $30,000 – $40,000 – Organization – Data entry and record keeping – Time Management – Support to department Level 2 Junior Accountant – Accounting – Bookkeeping and financial statements $40,000 – $55,000 – Financial analysis – Assistance in budgeting and reporting – Excel proficiency – Support to senior accountants Level 3 Senior Accountant – Financial analysis – Financial reporting and analysis $55,000 – $75,000 – Budgeting – Budget management and forecasting – Leadership – Oversight of junior accountants Level 4 Finance Manager – Strategic planning – Financial strategy and planning $75,000 – $100,000 – Team management – Supervision of accounting department – Compliance – Ensure financial compliance and controls
5. Align compensation structures
During framework construction, this is a great time to align or realign compensation structures. It’s also necessary to ensure compensation aligns with the new job levels. Adjust minimum and maximum salary amounts for each job level, benefits, and other compensation elements.
6. Communicate the changes
Communication is critical. Be sure to have a proper communication plan in place to inform all employees of the new job leveling system, its benefits, and any changes that might affect them. It’s best to inform employees as you work on the new system as well, not just once it’s ready to be implemented. Explain their learning and development opportunities to progress in the organization under the new system.
7. Educate managers on the framework
As any HR professional knows, supervisors and managers are the front-line team responsible for using and explaining the new system. They are usually the first people employees will approach with questions. It’s vital to have training sessions and workshops in place to educate supervisors and managers on the job leveling framework to help them understand and effectively utilize it with their teams.
8. Integrate job leveling into performance management systems
We’ve already discussed how job leveling is an important part of performance reviews and goal setting. Be sure to integrate the framework into any future or existing performance management systems so that performance evaluation aligns with the expectations and responsibilities of each job level. This will create more objective evaluations. Also, job leveling should be aligned with other HR practices as well, such as talent management, learning and development and career enablement practices.
9. Monitor the impact of the job leveling system
Monitor the impact of job leveling on organizational outcomes. For example on retention, promotions, internal mobility, market comparison etc.
Key takeaways
Job leveling is a necessity for any organization looking to retain and engage employees and ensure a long and successful future for the organization. With the right job leveling framework in place, employees and the organization as a whole have a clear path forward.
While setting up a job leveling system might feel daunting at first, once it’s up and running, it will make life much easier for everyone. Then it’s a matter of evaluating it and keeping it up-to-date as the work environment continues to change. Following the nine steps above will help any organization to implement a job leveling system.
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