Staff Compensation System Development

OVERVIEW

Based on the recommendations of several task forces and committees that have met over the past five years, the staff compensation system has been revised over a roughly two year period beginning in June 2006. The major recommendations that were adopted by the Board of Governors include:

  1. The existing step-and-grade system for classified staff will be abandoned in favor of a system with open pay ranges.
  2. The distinction between classified and unclassified staff will be abandoned in favor of a new system where all staff fall under the same system for salary purposes.
  3. Future pay increases should be determined through a Compensation Matrix process where pay increases are based on the overall pay increase budget, individual performance appraisal results, and the individual's position in the pay range.

 

 

IMPLEMENTATION OF RECOMMENDATIONS

Implementation of these recommendations required that:

  1. All jobs must have accurate and up-to-date job descriptions.
  2. Each job must be in a pay grade that reflects the job's value to the University and its value in the labor market.
  3. A systematic performance appraisal process must be in place.
  4. People must be trained in performance management processes.
  5. Units must develop and apply the Compensation Matrix.

These requirements led to the formation of a number of teams and the cooperation of the administrative units to implement the staff pay recommendations.

 

 

THE IMPLEMENTATION PROCESS

The Training and Development Team. This team trained employees in the use of the performance management systems, including observing and documenting performance, completing performance appraisals, and goal setting.

The Compensation Analysts Team. This team was responsible for ensuring that job descriptions were accurate, developing the job evaluation systems, and establishing appropriate pay grades and ranges for all jobs. This required the following actions:

Grouping jobs into job families: All jobs were organized into the following four job families.

  • Job Family 1 includes all administrative support and clerical employees and nonexempt accounting, bookstore, and library employees.
  • Job Family 2includes crafts, trades, and service workers.
  • Job Family 3 includes computer operators, programmers, technicians, and information technology employees.
  • Job Family 4 includes executive, managerial, professional, paraprofessional, and administrative employees.
Job families are used to facilitate human resource functions such as writing job descriptions, evaluating jobs, applying pay survey data, and creating pay grades and ranges that more closely reflect a job's value to the University and in the labor market.
*For timelines and specific information about each job family, click on the link to the desired job family located on the left side of the screen.
Developing the job evaluation system: The new job evaluation system is a refinement of the previous point-based system. Point-based job evaluation is a process of evaluating the relative worth of each job by defining a set of compensable factors and using a rating scale called a point method to measure each factor for each job. Compensable factors are the things the University values and is willing to pay for in a job, such as the level experience, education or skill that is required to perform a job. The compensable factors each have 3 to 8 different levels, and as the levels increase, more of a factor is demanded in a job. Each job is rated at a specific level for each factor and gets points for being at that level. Each job family uses a slightly different job evaluation plan, which allows human resources to administer compensation more effectively and accurately by using a set of compensable factors and scales that reflect the unique characteristics of the job family for which the plan was designed.
Conducting job analysis and job description review: Job analysis is the systematic study of a job to determine the essential functions, or duties of a job, and the minimum requirements to perform these essential functions. Not all job families had the same needs for job analysis. 
  • Job Family 1 required extensive analysis, including having each person complete a task inventory, having departments or units review and revise job descriptions that are unique to the unit, and conducting interviews with incumbents in multiple incumbent jobs located in many departments across the University in order to write new job descriptions for these jobs.
  • Job Family 2 required no new job analysis, only a review of job descriptions by supervisors because job descriptions were fairly up-to-date and accurate.
  • Job Family 3 required job analysis of two multiple incumbent jobs located in several departments through incumbent interviews; job descriptions of jobs unique to a unit were reviewed by supervisors and revised as needed.
  • Job Family 4 is composed of many single incumbent jobs and these job descriptions were reviewed by departments and revised as needed.
Job descriptions include the following:
  • A list of major job duties and job tasks.
  • Accurate descriptions of the job specifications, or minimum requirements, including educational requirements, experience requirements, skill requirements, and certifications.
  • The nature and amount of supervision both given and received.
  • A description of any managerial responsibilities.
  • A description of any budgetary and purchasing responsibility and authority.
Conducting job evaluation: Using the job evaluation system described above, job evaluation committees composed of job incumbents and supervisors rated each job at a specific level for each compensable factor. Each job family had its own job evaluation committee, or set of committees, made up of a combination of individuals that belong to that particular job family and/or supervisors of positions in that job family who have a thorough knowledge of the jobs being evaluated. The point values for each factor determine a job's point total and the point totals for all jobs create a job structure, or a hierarchy of jobs. Jobs with similar point value were placed in the same pay grade.
Designing new pay grades and ranges: Because jobs typically do not have flat rates, jobs with similar point values were grouped into pay grades that have a defined pay range with a specific minimum, midpoint, and maximum values.  Multiple salary surveys were used to acquire pay data for a number of benchmark jobs; not all jobs have pay survey data.  The salary range associated with each grade was developed by using the market data for benchmarked jobs in the same pay grade.  Market medians, averages, and the 25th and 75th percentile values for the benchmarked jobs were used to develop salary ranges for all jobs in the same pay range.  Jobs in a grade will be paid within their associated pay range.

Guidelines have been developed for the Compensation Matrix that will be used by each Cost Center to determine pay increases that will be effective in July 2008.  Administrative units are also responsible for conducting performance assessment of staff members.

 
THE COMPENSATION MATRIX
The use of the Compensation Matrix bases pay increases on the overall salary increase budget, an individual’s current position in the pay range, and an individual’s performance evaluation. Small differences in pay increases across cost centers may occur because pay increases are established at the cost center level. All things being equal, higher percentage pay increases will go to:
  • Individuals at the bottom of the pay range.
  • High performing individuals.
The Compensation Matrix will be used to determine July 1, 2008 staff salary increases.