Class and grade are used differently in this method. A grade is a group of different jobs of similar difficulty or requiring similar knowledge and skill to perform. A class is a subdivision of a given occupation. For example, Assistant Accountant, Accountant, Senior Accountant and Chief Accountant are the jobs in the occupation of Accountant. The jobs within a class have fairly similar task to be performed whilst the jobs within a grade may be different as far as tasks are concerned. Under this method, jobs at different levels in the organisational hierarchy are divided into various grades with a clear cut definition of each grade. Grades are formulated on the basis of nature of tasks, requirements of skill, knowledge, responsibilities and authority of various jobs. Points Rating Method : This method was introduced by Merrill R. Lott. This was one of the earliest approaches for evaluating jobs based on quantitative values. This method is analytical in the sense that jobs are broken into components for purposes of comparison. This method is quantitative as each component of the jobs is assigned a numerical value. Thus, characteristics or factors considered to have a being on all jobs in the programme like skill, knowledge,responsibility, working conditions etc. are selected under this method.
Factor Comparison Method : This method is based both on the principles of points rating and principle of ranking. This method is analytical as jobs are broken into subfactors and components. Under this method, first the componetns sub-factors are ranked under various factor heading. The next step is assigning the monetary values to the components or sub factors of each job.