Career and Compensation
Program
Employee Information Sessions
April 23 – May 11, 2012
1
Today’s Agenda
Content
Timing
Overview of the Career and Compensation Program
5 min
Compensation Program
20 min
Implementation of Compensation Program
20 min
Career Program
15 min
Frequently Asked Questions
30 min
2
Overview of the Career
and Compensation Program
3
Why Focus on Career
and Compensation?
UR Career and Compensation Program will help UR remain an
employer of choice and help ensure the following:
• The recruitment and retention of top talent
• Pay aligned to our competitive market
• Internal equity in pay among our employees
• Opportunities for our employees to grow and understand
what is required with different career levels across the
University
• The foundation on which UR can better manage pay for
performance
The University is committed to providing employees with market competitive pay and
opportunities to grow and develop within our Institution.
4
Outcomes of the New Program
Key outcomes of the new program include:
• Compensation Strategy: Describing the role of pay and UR’s expectations
for the management of pay for attracting, retaining, and rewarding
employees at the University
• Compensation Structure: Enabling UR to manage compensation
competitively against the market through market-based salary grade ranges
• Compensation Policies: Providing policies for managing compensation at
the University to help ensure internal equity and consistent application of
the program
• Career Structure and Policies: Provides employees with a roadmap for
developing their skills and competencies in order to advance.
(Still in development.)
These outcomes will be available in May on the Human Resources website.
Information on the Career Structure will be available later in the year.
5
Project Phases
The objectives were accomplished through the following four phases:
Phase 3: Policies
and Processes
Phase 1:
Compensation
Strategy
Phase 2: Career and
Compensation
Program
September 2011 –
Phase 4: Planning for
Implementation, Costing
and Training
January – March 2011
March – September 2011
January 2012
October 2011 – May 2012
 Update UR’s
compensation strategy,
including identification
of compensation’s
appropriate role in the
overall Employment
Value Proposition
 Development and
confirmation of
comparison markets for
compensation
assessment
 Completion of market
pricing and assessment
of pay as compared to
market
 Development of draft
career architecture
 Establishment of a new pay
structure for exempt and
non-exempt employees
 Development of
compensation policies
and procedures
 Development of detailed
implementation plan
including training,
automation, and ongoing
communications
 Finalized grade
placement of positions
into the new structure
 Detailed cost of
implementation analysis
 Manager Training and
Employee Information
Sessions
Full implementation of the new compensation program will occur on
July 1, 2012.
6
Overview of the Career and
Compensation Program
What the Program Is
What the Program Is Not
•
•
•
•
•
•
A complete review of the compensation
philosophy, structure and policies to help
ensure pay is fair and can be linked to the
job and performance
An update of our comparison markets
and data sources to help ensure UR can
compete for talent
A program to provide market competitive
compensation to all our jobs
A guidebook for employees to know how
to develop in preparation for new
opportunities as they occur in the future
A framework to better manage pay for
performance
•
•
A slight modification of the current
compensation structure, it is entirely new,
developed with significant input from VPs
and others in the organization
A step-rate program in which people get
automatic increases
A point factor or system that gives
increases based on small changes in the
job or skills
7
Compensation Program
8
UR’s Compensation Strategy
Role of Pay
Work/Position
Valuation
The University of Richmond will maintain a career and compensation program directed toward
attracting, retaining and rewarding a highly qualified and diverse workforce to serve students,
faculty and staff. Pay will be set at levels that are competitive with the University’s comparison
markets.
A position’s grade is determined based on an evaluation of both the external competitive
market for the position, as well as the relative grade among similar positions across the
University.
Comparison
Markets
The University benchmarks its pay against organizations with similar characteristics. Different
market comparisons are used for different positions across the Institution based on the type of
position.
Pay Systems and
Delivery
Base salary is the primary means of pay delivery at the University. Annual merit increases are
the primary method for salary increases, but market adjustments may also be considered when
deemed necessary.
Annual
Performance
Increase
Career
Communication/
Openness
Annual salary increases shall be based on the performance of an individual and the contribution
he/she makes to the institution, within budget parameters.
The University provides staff with meaningful career opportunities that include opportunities
for growth.
Information about pay ranges, market competitiveness, how pay decisions are made, how
performance is reviewed and career definitions, will be publicly available to the University
community. However, information on individual pay will remain confidential between the
University and the individual.
9
UR’s Compensation Strategy continued
President’s Cabinet: Communicate openly and clearly with the University community on
the career compensation program design and its administration. Endorse compensation
and performance management design and support ongoing administration in accordance
with program guidelines.
Roles and
Responsibilities
Managers and Supervisors: Understand the career, compensation and performance
management philosophy and policies, communicate effectively
on matters relating to career and compensation, partner with HR to deliver consistent
practices. Actively participate in the University's performance feedback and development
program.
Employees: Understand the career, compensation and performance management
philosophy and policies, ask questions to managers and supervisors when clarification is
needed. Actively participate in the University’s performance feedback and development
process.
Human Resources: Partner with managers and supervisors to administer and interpret
career, compensation and performance philosophy and policies.
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UR’s Comparison Markets
The comparison market for each survey source depends on the type of position
being assessed.
Position Type
CUPA-HR
surveys
(Higher
Education)
Senior
Administrators
Mid-level
Administrators
Non-Exempt
Employees
Schools with
operating budgets
between $100M–
$900M from the
combined list of top
50 liberal arts, top 50
business, and top 50
law schools, plus
VCU and UVA
Schools with operating
budgets between
$100M–$900M from
the combined list of
top 50 liberal arts, top
50 business, and top
50 law schools, plus
VCU and UVA
Schools with operating
budgets between
$100M–$900M from
the combined list of
top 50 liberal arts, top
50 business, and top
50 law schools, plus
VCU and UVA
Athletics
Division 1 schools with
operating budgets
between $100M –
$900M from the
combined list of top 50
liberal arts, top 50
business, and top 50
law schools, plus VCU
and UVA
Plus A10 and CAA
schools
Towers
Watson
surveys
National, not for
profit, FTE 1,000 –
4,999
Southeast, all
organizations
Richmond-Norfolk, VA,
all organizations
Mercer
surveys
National, FTE
1,000 – 3,500
Southeast, all
industries
Richmond, all
industries
N/A
N/A
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Compensation Program Key Terms
• Benchmark Jobs:
– Jobs identified as having a market match after review of UR job
descriptions and job descriptions defined in their survey sources
– Matches vetted by managers in each division as well as HR
– Listing of benchmark jobs is provided on the URHR website
• Non-Benchmark Jobs:
– Jobs unique to the University and difficult to find comparable
external matches
– May have multiple functions and responsibilities or may be
designed exclusively to meet a specific UR need
– Compared internally to benchmark positions with similar
knowledge and skills and job scope to determine market value
and placement into the salary structure
12
Compensation Program Development Process
The development of the compensation program followed best
practice within Higher Education.
1. Understanding
Position Content and
Position Matching
2. Analyzing
the Market
3. Building the
Salary Structure
 Used current position
descriptions to match UR
positions against
competitive market data
 Collected national, local,
 Determined structure that
higher education and
would meet the specific
general industry data,
needs of UR based on
depending on the type of job
market results
 Based on position
content, requirements,
scope of accountability,
and institutional size
 Collected 50th (median)
percentile market data for
each benchmark job
 Created 12 salary grades
structure with competitive
salary ranges
 Approximately 350 jobs
(50% of jobs covering 65%
of the employee population)
was benchmarked
 Wide grades to allow for
growth within a job
 Matched to survey
description if about 75%
of position content aligns
 Reviewed multiple times
with HR, Vice-Presidents
and their direct reports.
Final Matches were
approved by VPs and
Direct Reports
 Used only quality credible
sources of data
4. Placing Jobs Into
the Structure
 Benchmark positions
placed by market median
value and internal
relationships, validated
by VP’s and their direct
reports
 Benchmark jobs placed
into the structure based
on closest midpoint in
the salary structure
 Non-benchmark
positions placed by
internal relationships;
placement of positions
validated by VP’s and
their direct reports
13
UR’s Compensation Structure
Grade
12
11
10
9
8
7
6
5
4
3
2
1
Minimum
$105,570
$91,180
$77,270
$65,480
$57,590
$48,800
$41,360
$35,050
$29,700
$26,158
$22,550
$20,800
Midpoint
$150,440
$125,370
$106,240
$90,040
$76,300
$64,660
$54,800
$46,440
$39,360
$33,352
$28,752
$24,786
Maximum
$195,310
$159,560
$135,220
$114,590
$95,020
$80,520
$68,240
$57,830
$49,010
$40,546
$34,953
$30,132
•
Benchmark jobs placed into the salary structure based on the closest midpoint. For example: A job with a
market median value of $33,000 was placed into grade 3
•
UR salary grades overlap to allow for flexibility to pay for a range of individual skills, experience, and
performance within each grade
•
The width of the grade, often referred to as “range spread,” increases as the variation in experience, skills,
and competitive pay for the positions in the grade increases
•
The salary grade helps maintain competitiveness with the external market and ensure internal equity
among compensation for positions and individuals at the University
•
The grades represent new grades and do not line up with the old UR structure
14
The New Compensation Policies
Compensation policies address a variety of situations.
Help Ensure Fair, Competitive and
Equitable Administration of Pay
Reward Performance
and Support Career Growth
 Paying within the grade
 Promotion
 Starting salaries
 Transfers
 Annual salary increases
 Temporary assignments/
interim appointments
 FLSA
 Maintaining the program
New compensation policies will be found on the URHR
website.
15
Management of Pay within the New Structure
An individual’s grade, skills, experience, and performance determine the actual
salary for the position.
Position Role,
Responsibilities, and
Skill Requirements
Grade
+
Knowledge, Skills,
Experience, and
Performance
+
Location in
Grade
=
Pay Opportunity
=
Recommended
Base Salary
16
Implementation of
Compensation Program
17
Moving to the New Structure
• This is an entirely new program
– As part of the implementation, no one will get a pay decrease
– There is no direct relationship between current grades and new
grades
• Employee Impact
– Employees whose pay is currently aligned with the market will
not receive a market adjustment (increase to base pay)
– Employees whose pay is not currently aligned with the market
will receive a market adjustment (increase to base pay)
• Once the grade for the position was established, an
employee’s pay was determined by experience in current
role at UR, influenced by performance data and internal
equity.
– Employees will continue to be eligible for annual merit increases
as part of the compensation program
18
Implementation Details
Implementation
• New Compensation Program Letters: Distributed May, 2012
• Contents include:
– New salary grade
– Market adjustments (if applicable)
– Title changes (if applicable)
• Managers will distribute the market adjustment letters. Following
the distribution of the letters, UR encourages managers to have
one-on-one meetings with employees to review the contents and
discuss any questions.
19
Merit Increase Details
Annual Merit Increases
• Annual merit increase process follows normal timeline
• Merit increase (if applicable) will be effective after any applicable
market adjustments are applied
• Merit increase letters: Distributed June, 2012
• Salary effective July 1, 2012 will include merit increase and market
adjustment (if applicable)
• Managers will distribute increase letters to employees
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Timeline for Distribution of Market
Adjustment and Salary Letters
May 14th – 18th
Make-up Employee
Training
April 2nd – 6th
Manager Training
April 1
May 24th
• Salary Spreadsheets
due back to HR
June 8th
• Confirmation
Salary
Spreadsheets
sent to VP’s
May 4th
• Salary Spreadsheets
sent to VP’s—salaries
will include any market
adjustments
May 1
April 9th – 13th
Make-up Manager
Training
June 1
May 11th
• Market Adjustment letters
distributed to VP’s
April 23rd-May 11th
Employee Informational
Sessions by Department
July 1st
• Market adjustment
and merit increase
effective
July 1
June 26th
• Salary letters
distributed to VP’s
May 24th
• Performance
feedback due to HR
21
Career Structure and Policies
22
Introduction of the Career Structure
•
•
•
The career structure explains how employees move through career stages
The career structure is comprised of:
– Career Stages: Major steps in an employee’s career.
– Career Levels: Groupings of similar salary grades for each career stage
– Career Criteria: Skills and competencies that differentiate the career stages
and levels.
The goal of the career structure is to provide employees with a roadmap for
developing their skills and competencies in order to progress to a job in the next
career stage or level
When completed, career information will be available
on the URHR website.
23
Highlights of the New Program
24
Highlights of the New Program
Items to remember about the new program include:
• A new comparison market group, more reflective of where UR
competes for talent
• There is no comparison to the old compensation structure
• There was a significant amount of involvement from UR
leadership in the development of the new program
• Approximately 350 jobs were benchmarked in the process:
– This accounts for 50% of UR jobs and 65% of UR
employees
– This a significant amount of coverage and strong
representation of our employees
25
Highlights of the New Program continued
Items to remember about the new program include:
• Implementation of the structure ensures everyone is paid
competitively relative to our newly defined market:
– 49% of employees are getting a market adjustment to
bring them in line with the market
– Those not getting an adjustment, have pay that is already
in line with the market
• Implementation of the new structure is the result of a
commitment by the University and Board of Trustees to help
ensure fair and competitive pay for all UR employees
The new program will help ensure we are competitive in pay now
and in the future.
26
Frequently Asked Questions
27
Frequently Asked Questions
Q. How many salary grades are there?
A. There are twelve broad salary ranges. This information will be available on
URHR website in May.
Q. How was I assigned to my new grade? What considerations were taken into
account?
A. Information related to positions, not individuals, was obtained through
current position descriptions. Information about position content, position
requirements and scope of accountability was compared to the same
position information from several surveys sources. The results of this process
were approved by Vice-Presidents and their direct reports.
Q. I do not think that I was assigned to the right grade. What can I do?
A. Every effort was made to objectively obtain relevant market data for
University positions and to match University positions to the survey
positions. Benchmark positions were placed in a grade based on market
value and internal relationships, while non-benchmark positions were placed
in a grade by internal relationships. The grade placement of positions was
validated by Vice-Presidents and their direct reports. All grade level
determinations are final. If you have any questions, please speak with your
manager for clarification.
28
Frequently Asked Questions continued
Q. How can I find out what grade my position is and if I will receive an increase?
A. All employees will be notified of their grade and market adjustment (if
applicable) in a letter that they will receive from their managers in May. Your
department head or manager will also be able to advise you of the salary
grade and adjustment (if applicable) or you may contact the Human
Resources Office for this information.
Q. How were market adjustment decisions made for 2012?
A. Once the grade for the position was established, an employee’s pay was
determined by experience in current role at UR, influenced by performance
data and internal equity. Vice-Presidents approved the implementation pay
for each employee.
Q. How was the number of years in position determined?
A. Years in position was based on the date you were hired into your current
position.
29
Frequently Asked Questions continued
Q. Was previous experience outside of UR accounted for in this study? If not, why
not?
A. In order to apply a consistent methodology for all employees, we could not
look at prior experience outside of UR. Therefore, only time within a role at
UR was used to determine the employee’s pay in the new structure.
However, previous experience should have been taken into account when
determining starting salaries as individuals joined the University.
Q. If I receive a market adjustment does that mean I have been underpaid? Will I
receive any retroactive pay?
A. If an employee receives a market adjustment, it is because their pay is not
currently aligned with the market. We are using a new comparison market
and salary structure which means pay will be aligned with the new market
and structure effective July 1st. This does not mean that pay wasn’t aligned
properly in prior years. Retroactive pay will not be given.
30
Frequently Asked Questions continued
Q. How can I progress to a higher grade or how can I increase my salary?
A. Employees continue to be encouraged to apply for promotional opportunities
when they occur. Qualifying for a position in a higher salary grade, which
provides for a significantly broader role will generally be recognized by a salary
increase. Annual performance increases also allow employees to increase their
salary while remaining in their current grade.
Q. Will titles change as part of this study?
A. Titles for most positions will not change. Titles for a small group of
administrative support positions will change based on a review of position
descriptions. We may consider further consolidation of titles at a later date.
Q. Will all employee position descriptions, grades and titles be online in July?
A. Information on position requirements, grades and titles will be available in the
future. This will enable employees to know what is required of a position in
order to prepare themselves if they are interested in applying for the position.
31
Frequently Asked Questions continued
Q. Who from the University was part of the development of this program?
A. The Presidents Cabinet, an Executive Committee, VP’s Direct Reports, Steering
Committee and HR Project Team. Please see website for further details on
participants of each group.
Q. Will survey information, including data and the matches, for UR positions be shared
with incumbents?
A. No, the survey matches and data are confidential. The survey data was used,
and will continue to be used appropriately by URHR to determine market level
pay for our employees.
Q. How often will the market levels be reviewed?
A. Human Resources will conduct regular market reviews and make adjustments to
salary grade ranges as necessary.
32
Frequently Asked Questions continued
Q. Which individuals are excluded from the new compensation structure?
A. Any employee whose pay level is determined by the Board of Trustees (such as
Vice-Presidents, Academic Deans and select coaches) and Spider Management
are not included in the new compensation structure. Additionally, faculty are
not included in the compensation structure, faculty pay is covered under a
different program.
Q. Is it possible to be promoted in the same grade?
A. No, a promotion occurs when an employee moves to a position in a higher
grade. Movement to a new position in the same grade is considered a transfer
even if the responsibilities are somewhat greater.
Q. How do I get from the minimum of a grade to the salary midpoint?
A. Receiving merit increases is the primary way to advance pay within a grade.
Based on UR’s performance management process, high performers should
receive higher merit increases than average or low performers. The overall
merit budget will impact the amount of funds available for merit increases.
33
Frequently Asked Questions continued
Q. If I am paid above the maximum of a grade, will my salary be capped?
A. No, a cap on salary maximums will not be enforced, as decided on by UR’s
Cabinet. The job will stay in the grade and not move up to a higher grade.
However, effective compensation practice is to use the grade ranges to manage
pay. Individuals paid above the maximum are typically those with many years at
the institution.
Q. My position description was not up to date when the study was done, how can I
ensure my grade is correct?
A. Position descriptions were used as a starting point to determine market
matches and grade assignments. However, URHR had multiple discussions with
Vice-Presidents, their direct reports and managers to ensure that if the contents
of the position description were not up to date, the additional or different roles
and responsibilities were taken into account when matching to the market or
assigning to a grade.
34
Upcoming HR Initiatives
• Implementation of a new talent management system to
support all aspects of development including performance
management and the new career structure
• Finalization of the new career structure to determine how and
when it will be used to inform employee development
• Revision of the Position Description template
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Any Additional Questions?
36