UNMC Human Resources Department
Compensation Administration Policy
HUMAN RESOURCES COMPENSATION ADMINISTRATION POLICY
Effective: July 1, 2005
Purpose
1.1
It is the policy of the University of Nebraska Medical Center (UNMC) to provide competitive
compensation levels to support the ability to attract, motivate, and retain qualified
employees. The University of Nebraska Medical Center NU Values Compensation
Administration policy provides a basis for market relevance and internal equity in pay
decisions; as well as the growth and development of employees.
This policy provides guidance for UNMC campus supervisors and employees regarding
interpretation and administration of University of Nebraska policy 7505 – NU Values
Administration and policy 7510 – Salary Administration.
Scope
2.1
The UNMC NU Values Compensation Administration policy is applicable to all UNMC
Office/Service and Managerial/Professional positions. This policy is not applicable to
Faculty, Academic Administration, and other Academic positions.
References
3.1
7505 Policy – NU Values Administration
7510 Policy – Salary Administration
Authorities
4.1
At the University system level, the Vice President of Business and Finance, upon the advice
and consultation from the Council of Business Officers, is responsible for the content of the
NU Values Program.
The Director of Human Resources at Central Administration is responsible for the systemwide administration of the NU Values Program to include ongoing development and
maintenance activities.
4.2
Revisions or amendments to the NU Values Program are made through recommendations
to the Vice President of Business and Finance from the Director of Human Resources at
Central Administration and the campus Human Resources Directors. Actions taken by the
Vice President of Business and Finance are taken with the advice and consultation of the
Council of Business Officers.
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4.3
The UNMC Director of Strategic Staffing and Compensation is responsible for the
administration, implementation, and maintenance of the NU Values program at the campus
level in consultation with the Assistant Vice Chancellor, Director of Human Resources.
4.4
The Strategic Staffing and Compensation Division is available for consultation on any
compensation transaction. There are circumstances which require Strategic Staffing and
Compensation Division involvement. Those circumstances are specified in the policy
statements below.
Program Structure
5.1
Within the NU Values program, there are four major components to the compensation
infrastructure. These consist of Job Classification, Job Families, Pay Bands, and Market
Relevant Survey Data.
5.1a
Job Classification is a process by which job content value characteristics are
identified, evaluated, and allocated to a Job Family and pay range, and are
assigned unique title codes. These classifications are grouped into one of two
categories – Benchmark Jobs or Non-Benchmark Jobs.
Benchmark Jobs are well-identified jobs with clearly recognized responsibilities,
duties, and qualifications. To be classified as a Benchmark Job, relevant and
competitive market pay data must be available and utilized in the development of a
pay range.
Non-Benchmark Jobs are jobs for which relevant and competitive market pay data
is not available, or, where available, data is not used in the development of a pay
range.
Non-Benchmark jobs are allocated to the Job Family Pay Band structure utilizing
one of both of two steps – the Job Placement Matrix and/or a process called “whole
job slotting”. The Job Placement Matrix measures job content value by examining
the level of the compensable job content value factors that are present in the job
which include: Knowledge, Skills and Abilities, Problem Solving and DecisionMaking, Interactions, Nature of Supervision, and Impact. Whole job slotting is a
ranking process in which the job is compared with previously allocated jobs and
placed in the appropriate group of “like valued” jobs.
In compliance with the Fair Labor Standards Act (FLSA) 541 regulations, both
benchmark and non-benchmark jobs are evaluated to determine the job’s FLSA
exemption status.
5.1b
Job Family is defined as a group of jobs related by their common vocations or
professions and having a continuum of knowledge, skills, and abilities. The NU
Values program recognizes 15 job families to include:
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Administrative and Business Operations
Advising/Career/Student Services
Educational/Outreach Programs
Facilities Planning and Operations
Food Service/Dietary
Health Care
Information Technology
Library Services
Materials Management/Print Production
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5.1c
Museum/Arts
Public Relations/Marketing/Development
Public Safety
Research and Agriculture
Sports and Recreation
Television, Radio, and Video Production
Each Job Family has its own Pay Band representing the total pay opportunity for
those jobs allocated to the Job Family. Within each Pay Band are a series of Zones
and Benchmark Ranges.
Each band contains four zones: Assistant, Associate, Specialist, and Senior. A
Zone is a unique interval of pay opportunity within a pay band. Each Zone
represents common characteristics of jobs allocated to each Zone based on Job
Placement Matrix results. An employee’s pay will not be less than the minimum or
greater than the maximum of the Job Family Zone to which their position has been
classified, unless specifically authorized by the Director of Strategic Staffing and
Compensation.
Each Zone is segmented by Benchmark Ranges. Benchmark Ranges are used to
effectively communicate the market relevant pay opportunities for purposes of
planning, budgeting, employee hiring, and employee pay changes.
The minimum and maximum of a Benchmark Range is defined as the parameters
within which an employee’s pay can be administered. The employee’s pay will not
be less than the minimum of the Benchmark Range to which their job is assigned.
The Trainee designation is an exception to this policy. Refer to Section 6.2b for
Trainee designation details.
5.1d
The NU Values pay structures are analyzed on an annual basis to determine
relevancy to market. Relevant labor market wage and pay surveys are utilized,
which represent a cross section of job classification titles reflecting relevant labor
markets, from which relevant labor market Benchmark Ranges are developed.
The University of Nebraska labor market is defined as an area of national, regional,
or local scope encompassing a competitive market for the jobs from which the
University recruits qualified employees.
Salary structures are maintained by job family. Any market adjustments to these
structures will reflect the unique characteristics of the relevant market changes for
each job family.
Departments/units may question the validity of the market data or the lack of
relevant survey sources for a particular job classification. Informal salary surveys
may be conducted based on the criteria established in the “Statements of Antitrust
Enforcement Policy in Health Care” that was jointly published by the U.S.
Department of Justice (DOJ) and the Federal Trade Commission (FTC) in August,
1996. Under no circumstances should any employee of the University directly
contact outside organizations for salary related information. The Strategic Staffing
and Compensation Division is available to review requests to ensure the established
criteria are met.
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Pay Administration
Employee pay change opportunities (pay actions) can be influenced by either: Classification Related
factors or Employee Related factors.
Classification Related
6.1
A Classification Related factor is defined as a job content value change to an employee’s
current position, or, in a position to which the employee is being moved.
Based on
individual circumstances, the presence or occurrence of a Classification Related action may
or may not result in an Adjustment to the employee’s pay level.
Classification Related factors must be considered when determining the pay action to initiate
for an employee. An increase or decrease in an employee’s pay level for classification
related reasons is considered an Adjustment and pertains to four categories:
Advancement, Promotion, Additional Responsibilities, or Voluntary Reduction.
6.1a
An Advancement action is defined as the result of a significant increase in job
content value that dictates a reallocation of the classification to a higher Benchmark
Range. When such change results in a reallocation of the classification to a higher
Zone within a Job Family, it is considered to be a Promotion action for the
incumbent employee. Advancement and Promotion actions may warrant a pay
Adjustment increase of up to 10%. Pay Adjustment increases of more than 10%
require prior approval from the Director of Strategic Staffing and Compensation. An
employee’s pay level will not exceed the maximum of the new Benchmark Range
assignment.
6.1b
An Additional Responsibilities action is defined as a change in pay level based on
an increase in job content value that does not warrant an Advancement action or
change in Benchmark Range assignment. Managers are required to contact the
Strategic Staffing and Compensation Division for guidance on every Additional
Responsibilities action.
An Additional Responsibilities action may warrant a pay Adjustment increase of up
to 10% after the incumbent has been performing the additional responsibilities for at
least three months. Pay Adjustment increases of more than 10% require prior
approval from the Director of Strategic Staffing and Compensation. An employee’s
pay level will not exceed the maximum of the assigned Benchmark Range.
An End Additional Responsibilities action is defined as the completion of a
temporary increase in job content value.
6.1c
A Voluntary Reduction action is defined as the result of a decrease in job content
value due to reorganization or at the voluntary request of the employee; resulting in
a reassignment of the employee from one Benchmark Range to a lower Benchmark
Range within a given Zone, or, from one Zone to another. Managers are required to
contact the Strategic Staffing and Compensation Division for guidance on every
Voluntary Reduction action. Under normal circumstances, a Voluntary Reduction
action will result in a pay Adjustment decrease to the employee’s pay level. The
employee’s pay level can not exceed the maximum of the Benchmark Range to
which the employee is newly assigned.
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Employee Related
6.2
While Classification Related factors are defined by changes in job content value, Employee
Related factors are defined by changes in the characteristics of, and within the influence of,
the employee. Based on individual circumstances, the presence or occurrence of an
Employee Related action may or may not result in an Adjustment to the employee’s pay
level.
Several factors must be considered when determining the starting pay level of a New Hire
and future types of pay actions. These actions will be based on several job related factors
that may include, but are not limited to, the following considerations:
-
Qualifications of the new hire including past experience and education
Previous work record including performance contributions
University pay levels of similarly situated employees in comparable jobs
Market Pay Levels
Pay History
Total Cash Compensation (Base Pay, Stipends, Other)
Department budget and fiscal resources available
An increase or decrease in an employee’s pay level for Employee Related reasons is
considered an Adjustment and pertains to six distinct actions: Trainee Adjustment action,
Probationary Adjustment action, Performance Adjustment action, Internal Adjustment action,
External Adjustment action, or an Annual Adjustment action. A Voluntary Reduction action
may or may not result in a pay Adjustment decrease and a Demotion action can not result in
a pay adjustment increase. While under normal circumstances, a Lateral Move action can
not result in a pay Adjustment increase, it can result in a pay adjustment decrease. See
section 7.1 for details of a Lateral Move action.
6.2a
The hiring manager will be responsible for determining the Starting Pay Level for a
new UNMC employee. A New Hire’s starting pay level is based on the factors listed
in 6.2 above.
6.2b
Prior to making an offer of employment for a trainee, or, reassigning a current
employee to a trainee position, managers are required to notify the Strategic
Staffing and Compensation Division for pay rate guidance. A Trainee Designation
is utilized for those employees who are hired in a particular job who do not meet the
minimum qualifications. Their starting pay level must not be less than 90% of the
minimum Benchmark Range for that classification.
Under normal circumstances, trainees will meet the minimum qualifications for the
job within twelve (12) months or less. During this period, the employee may receive
a Trainee pay Adjustment action increase. This pay action may or may not place
the resulting pay level at or above the Benchmark Range assignment minimum.
However, after twelve (12) months of being classified with the Trainee designation,
the employee’s pay level, given satisfactory performance, must be at least at the
minimum of the Benchmark Range assignment. Therefore, it is possible for an
employee to receive two adjustments within this period of 12 months.
The Trainee designation and title are used only for jobs in which the employee does
not meet the minimum qualifications of the job and their starting pay level will be
less than the minimum of the Benchmark Range assignment.
6.2c
A Probationary Adjustment action may only be provided to Office/Service
employees and is defined as a change in pay level based upon completion of six
months of service (original probationary period). To be eligible the employee must
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be fully meeting job expectations.
6.2d
A Performance Adjustment action is defined as a change in pay level based on
the individual performance contributions of the employee in the current job.
The recommendation for a Performance Adjustment must be supported with a
written employee performance review. To be eligible, the employee must have
been working for at least six (6) months prior to the adjustment date. These pay
Adjustments may only be granted on January 1 or July 1, provided sufficient funds
are available.
Performance Adjustment actions may warrant a pay Adjustment increase of up to
10%. Pay Adjustments of more than 10% require prior approval from the Director of
Strategic Staffing and Compensation.
6.2e
An Annual Adjustment action is defined as a change in pay level associated with
the legislative appropriations process and action from the Board of Regents,
normally given on July 1 each year.
Employees, whose current salary is within the approved campus annual adjustment
percentage of the established benchmark range maximum, shall be limited to not
more than the allotted percentage.
Each campus determines the method by which to allocate Annual Adjustment funds.
These may or may not include a performance factor. Should the process include a
performance factor, guidelines for the distribution of the funds will be provided. For
the purpose of the administration of this policy, an Annual Adjustment action which
includes a performance factor is not considered a Performance Adjustment action,
as defined by the NU Values program.
6.2f
An Internal Adjustment action is defined as a change in pay level based on
campus specific factors. These factors include, among others, the pay levels and/or
performance levels of similarly situated employees.
Internal Adjustments may warrant a pay Adjustment increase of up to 10%. Pay
actions of this nature will not exceed the established Zone maximum and normally
do not exceed the established Benchmark Range maximum.
Internal pay
Adjustments of more than 10% requires prior approval from the Director of Strategic
Staffing and Compensation.
6.2g
An External Adjustment action is defined as a change in pay level based on
factors outside of the campus. These may include significant changes in the
relevant market pay values, the economy, and/or direct competition to retain
employees.
It is recommended that the hiring manager consult with a Strategic Staffing and
Compensation Consultant to review the circumstances surrounding the need for an
External Adjustment action. The consultant can assist in the collection and analysis
of the relevant data.
External Adjustment actions may warrant a pay Adjustment increase of up to 10%.
Pay actions of this nature will not exceed the established Zone maximum and
normally do not exceed the established Benchmark Range maximum. External pay
Adjustments of more than 10% requires prior approval from the Director of Strategic
Staffing and Compensation.
6.2h
A Demotion action is defined as the result of a decrease in job content value
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reflecting an employee’s less than acceptable performance in the current job. A
Demotion action results in the reassignment of the employee to a classification
which is allocated to a Benchmark Range where the midpoint is at least 5% below
the current Benchmark Range midpoint.
Managers are required to contact the Strategic Staffing and Compensation Division
for guidance on every Demotion action. Based on individual circumstances, a
Demotion action may result in a pay Adjustment decrease to the employee’s pay
level. No pay Adjustment increase will occur with a Demotion action. The demoted
employee’s pay level can not exceed the maximum of the Benchmark Range into
which their classification is assigned.
A Voluntary Reduction action is defined as the result of a decrease in job content
value due to reorganization or at the voluntary request of the employee; resulting in
a reassignment of the employee from one Benchmark Range to lower Benchmark
Range within a given Zone, or, from one Zone to another. Managers are required to
contact the Strategic Staffing and Compensation Division for guidance on every
Voluntary Reduction action. Under normal circumstances, a Voluntary Reduction
action will result in a pay Adjustment decrease to the employee’s pay level. The
employee’s pay can not exceed the maximum of the Benchmark Range to which the
employee is newly assigned.
6.2i
6.2j
A Lateral Move action is defined as an employee accepting a reassignment to a job
classification in which the Benchmark Range midpoint is within 5% of the current
Benchmark Range. While under normal circumstances, a Lateral Move action can
not result in a pay Adjustment increase, it can result in a pay Adjustment decrease.
By definition the new and old classifications are considered to be of comparable job
content value.
6.2k
All additional compensation requests in lieu of an employee’s base pay are to be
submitted to the Strategic Staffing and Compensation Division for review – this
includes payments such as 1404 – Overload, 1401 – Additional Compensation,
0604 – Consulting, and 0605 – Honorarium.
This requirement excludes the Outstanding Performance Stipend and other
established nondiscretionary plans. The Strategic Staffing and Compensation
Division is available to review individual plans for identification of the type of plan, as
well as guidance on calculating payments.
Frequency of Pay Adjustment Actions
7.1
The frequency of pay Adjustments are approved and monitored by the type of action as
follows:
-
Trainee – Two Adjustments can occur within 12 months of being designated as a
Trainee, after which time the pay must be at least to the minimum of the Benchmark
Range.
-
Probationary – May occur for Office/Service employees after six months of original
hire date, given funding availability and the employee is fully meeting job
expectations.
-
Annual – Based on legislative appropriations and typically once a year.
-
Internal – Can occur as needed, given funding availability.
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-
External – Can occur as needed, given funding availability.
-
Performance – Can occur on January 1 and July 1, or not at all. However, when
considered along with an Advancement or Promotion action, the total combined
number of these pay Adjustments cannot exceed two occurrences during a fiscal
year without prior approval from the Director of Strategic Staffing and
Compensation.
-
Advancement/Promotion – Can occur as needed. However, when considered
along with a Performance Adjustment action, the total combined number of these
pay Adjustments cannot exceed two occurrences during a fiscal year without prior
approval from the Director of Strategic Staffing and Compensation.
-
Additional Responsibilities – Can occur as needed. However, when considered
along with a Performance Adjustment action, the total combined number of these
pay Adjustments cannot exceed two occurrences during a fiscal year without prior
approval from the Director of Strategic Staffing and Compensation.
-
End Additional Responsibilities – Can occur as needed, or as the temporary
increase in job content value is completed.
-
Lateral Move – Under normal circumstances, no increase in pay is permitted. A
decrease in pay is permitted when existing considerations warrant such an
adjustment. A pay increase may be approved when the employee’s current pay
level is positioned in the lower third of the Benchmark Range and there are existing
considerations (see 6.2 of this policy) which would warrant such an adjustment.
-
Voluntary Reduction – No increase in pay permitted. However, a decrease in pay
is permitted.
-
Demotion – No increase in pay permitted.
permitted.
However, a decrease in pay is
Policy Administration
8.1
Questions and comments regarding this policy are to be addressed to the Director of
Strategic Staffing and Compensation and the Assistant Vice Chancellor, Executive Director
of Human Resources.
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