What job evaluation actually does

Job evaluation is the process of assessing the relative worth of jobs within an organisation — not the people doing them, but the jobs themselves. The outcome is a graded hierarchy of roles that reflects the complexity, accountability, and decision-making demands of each position.

This grading structure becomes the foundation for everything else: your pay bands, your performance management framework, your promotion criteria, and your employment equity reporting. Without it, remuneration decisions are made on instinct, negotiation, and historical accident — which leads to inconsistency, internal inequity, and legal risk.

The most widely used job evaluation system in South Africa is the Patterson Job Grading System, which grades roles across six decision-making bands from Band A (routine, defined work) through to Band F (executive, integrative decisions). Other systems used in larger organisations include the Peromnes system and the Hay Group methodology, but Patterson remains the standard for most South African businesses.

The equal pay obligation and what it means in practice

Section 6(4) of the Employment Equity Act prohibits an employer from paying employees differently for work of equal value, unless the difference can be justified by fair and rational criteria. These criteria include seniority, experience, merit, quality of work, and any other relevant factor — but not race, gender, disability, or any other listed ground.

In practice, this means that two employees doing the same or substantially similar work must be paid the same, or you must be able to explain the difference in terms of a legitimate, documented rationale. 'That is just what we agreed when they joined' is not a rationale. A properly structured job evaluation and pay banding system is.

Referrals for equal pay disputes can be made to the CCMA or directly to the Labour Court. Successful claimants are entitled to retrospective pay adjustments and other relief. The financial exposure from an equal pay dispute affecting multiple employees can be substantial — and it is entirely preventable with the right structure in place.

What salary benchmarking tells you

Job evaluation tells you how roles relate to each other internally. Salary benchmarking tells you how your pay rates compare to the external market for equivalent roles. Both pieces of information are essential. An internally equitable structure that pays below market will still cost you your best people. A market-competitive structure with internal inequities will still expose you to legal claims.

Salary benchmarking draws on industry surveys, published remuneration data, and sector-specific information to establish what similar roles command in the market at a given point in time. The benchmarks are expressed as percentile ranges — typically the 25th, 50th, and 75th percentiles — allowing you to make a deliberate decision about where your organisation wants to position itself relative to the market.

A business that wants to attract and retain top talent typically aims to pay at or above the 75th percentile for critical roles. A business managing tight margins may target the 50th percentile and compete on culture, flexibility, and growth opportunity instead. The key is making the decision deliberately, with data, rather than by default.

Pay bands: turning evaluation and benchmarking into a usable structure

Once jobs are graded and market data is gathered, the practical output is a set of pay bands — salary ranges assigned to each grade level that reflect both internal equity and external competitiveness. Each band has a minimum, a midpoint, and a maximum.

The minimum represents the starting point for a new employee in that grade. The midpoint represents full competency — what a fully effective employee in that role should typically earn. The maximum represents the ceiling for that grade, beyond which an employee would need to move to a higher grade to receive further increases.

Pay bands give managers a framework for making remuneration decisions that is both consistent and flexible. They can reward high performers within the band without creating inequity, and they give employees a clear picture of where they are positioned and what earning growth looks like within their current role.

When to conduct a job evaluation and benchmarking exercise

Many businesses conduct their first formal job evaluation reactively — after a pay dispute, an equal pay referral, or a failed attempt to retain a key employee. By that point, the cost of getting it right is higher than it needed to be.

The right time to conduct a formal exercise is before problems arise: when your business reaches a scale where ad hoc pay decisions become difficult to manage consistently (typically around 15 to 20 employees), when you are preparing for your first employment equity submission, when you are restructuring or creating new roles, or when you are experiencing unexplained turnover that may be linked to remuneration.

Remuneration structures should also be reviewed periodically — typically every two to three years — to ensure they remain aligned with market movements and the evolving nature of roles within the business.

How OptiHR approaches job evaluation and benchmarking

OptiHR conducts structured job evaluation exercises using the Patterson system, matched to market benchmarking data relevant to your sector, region, and business size. We develop pay bands that are both defensible under the Employment Equity Act and competitive in the labour market you operate in.

We also work with you to implement the outcomes — communicating changes to employees, addressing anomalies where current pay falls outside the bands, and building a remuneration policy that gives managers and employees clarity about how pay decisions are made. A pay structure that exists only as a spreadsheet in the HR folder has limited value. One that is understood and applied consistently is a genuine management tool.