Point factor analysis (PFA) is a systemic

bureaucratic The term bureaucracy () refers to a body of non-elected governing officials as well as to an administrative policy-making group. Historically, a bureaucracy was a government administration managed by departments staffed with non-elected offi ...

method for determining a relative score for a job. Jobs can then be banded into grades, and the grades used to determine pay. PFA is a type of

job evaluation A job evaluation 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 ratio ...

; the main advantage of PFA is that it is systemic and analytical. Jobs are broken down into factors such as “

knowledge Knowledge can be defined as Descriptive knowledge, awareness of facts or as Procedural knowledge, practical skills, and may also refer to Knowledge by acquaintance, familiarity with objects or situations. Knowledge of facts, also called pro ...

required”. A set of closed questions in each factor break down to detail such as “level of

education Education is a purposeful activity directed at achieving certain aims, such as transmitting knowledge or fostering skills and character traits. These aims may include the development of understanding, rationality, kindness, and honesty ...

”. The responses to these questions are given a score, and totaled for each factor. Each factor is given a

weight In science and engineering, the weight of an object is the force acting on the object due to gravity. Some standard textbooks define weight as a vector quantity, the gravitational force acting on the object. Others define weight as a scalar qua ...

, and this affects the contribution made to the overall total score by that factor. Factors can be weighted according to their significance to the organization, and this allows the pay scheme to be linked to the organization’s strategy. A critical factor in

is that it is the role that is assessed, not the person doing it. Job evaluation can be performed on roles not recruited for yet. This means that the score should be both unrelated to the person doing the job and perceived as fair. PFA is not the only mechanism to do this analysis, as there are systems that carry out more complex calculations on the results of the

questionnaire A questionnaire is a research instrument that consists of a set of questions (or other types of prompts) for the purpose of gathering information from respondents through survey or statistical study. A research questionnaire is typically a mix of ...

. The Hay System of Compensation is one of the most commonly-used systems; it compiles scores using a complex lookup chart to weigh the factor values. Many modern schemes attempt to take better account of this. When the evaluation is performed methodically and analytically, it can provide a material factor defense in equal pay claims. A criticism often made against PFA in isolation is that it fails to take account of external factors.

Skill A skill is the learned ability to act with determined results with good execution often within a given amount of time, energy, or both. Skills can often be divided into domain-general and domain-specific skills. For example, in the domain of w ...

s in high demand in the market can create a premium, as organizations have to compete for the people who have them. Some account of the skills required can be accounted for in the evaluation, but the relative number of people with those skills cannot be accounted for internally, and will change over time.

References

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