Compensation Administration
Handbook
Your Work
Your Performance
Your Pay
Final Draft for Review
Prepared by
KLC Group, LLC
July 10, 2006
Division of Human Resources
Rensselaer Polytechnic Institute
2144 Burdett Avenue
Troy, New York 12180
(518) 276-2888
FAX (518) 276-3190
Rensselaer’s compensation philosophy is to pay competitively within a defined labor market in
order to retain, reward and recruit a diverse and talented faculty and staff who perform at or
above the successful performance level. The application of Rensselaer’s compensation
philosophy is to ensure reasonable and consistent pay practices that are aligned with the
Rensselaer Plan.
Page 2
TABLE OF CONTENTS
I. Salary Administration Overview
5
II. Career Ladders
6
III. Salary Ranges
6
IV. External Labor Market Analysis and Internal Equity
7
V. Pay Adjustments
 Performance-Based
 Promotion
 Reclassification
 Equity Adjustment
 Special/Premium Pay
9
VI. Roles & Responsibilities
14
VII. Filling a Position
15
APPENDIX
 FAQs
 Glossary of Terms
20
21
Page 3
I.
Salary Administration Overview
The salary administration process refers to all components of Rensselaer’s formal pay
program. Staff compensation is impacted by the following:

Career Ladders

Salary Ranges

External Labor Market Analysis and Internal Equity

Pay Adjustments





Performance-Based
Promotion
Reclassification
Equity Adjustment
Special/Premium Pay
Each of these components is discussed in detail in the following sections.
Salary Administration Process and Timing
Timing
March
Ongoing
Annual
Annual
July 1st
As needed
Step
Budget Approval
Annual HR Review
- Career Ladder Revisions
- External Market & Internal Equity review
Salary Range Adjustments
Performance Reviews
Performance-based adjustments (i.e., merit increases)
Other Pay Adjustments
Page 4
II.
Career Ladders
Career ladders are tools for defining and distinguishing, on a broad basis, the levels of
jobs within a job family. Career Ladders are not intended to be comprehensive job
descriptions. The established career ladders will provide standard criteria and a
consistent framework to:
 Develop Performance Management Tools
 Guide staff and managers regarding the career levels within job families
 Assist in the correct assignment of staff to the appropriate job family and
level based on the position requirements and responsibilities
 Serve as a basis for career counseling
Rensselaer has established career ladders for the following job families:
1. Administrative and Operations
2. Athletics
3. Health Services
4. Information Technology
5. Instructional and Research Support
6. Librarian
7. Management
8. Professional
9. Public Safety
10. Scientific and Research
11. Service and Maintenance
III.
Salary Ranges
Rensselaer uses market data to determine salary ranges. Representative benchmark
jobs can be readily compared to the market area surveyed and salary ranges are
established to reflect the “market rate.” These ranges are adjusted annually in
response to changes in the marketplace and the organization’s own budgetary
constraints.
A salary range is designed to accommodate a wide range of skills, experiences and
performance levels. Each salary range contains many different jobs. For example,
Accountant, Grants Administrator, and Purchasing Agent may all have the same
grade level because they each have the same relative value as determined by the
career ladders and the market analysis. Each level on a career ladder is assigned a
unique salary range that is developed and maintained based on the appropriate
competitive labor market.
Page 5
III.
Salary Ranges (continued)
Salary ranges intentionally overlap from one grade to another. Fully qualified
incumbents in a lower grade may be at the high end of their salary range, while the
salary of a less experienced employee in a higher grade may be near the minimum of
the range. It is thus possible that the salary of an experienced incumbent in a lowerrated position will be the same as or more than the salary of an inexperienced
incumbent in a higher-rated position.
The range minimum is the lowest pay rate Rensselaer is willing to pay for a position
and is typically offered to employees who possess the minimum qualifications and
who are expected to perform the basic position duties and responsibilities after
normal training.
The range midpoint typically reflects median pay in the competitive labor market and
is considered appropriate for experienced and fully qualified employees whose
performance fulfills the major requirements of their position.
The range maximum of the range is considered the upper limit of salary opportunity in
a level for a highly experienced employee.
IV.
External Labor Market Analysis and Internal Equity
Salary surveys are conducted periodically and analyzed to establish and maintain
competitive pay levels with all the markets in which Rensselaer competes and
recruits, as summarized in the table on the following page.
Page 6
IV. External Labor Market Analysis and Internal Equity (continued)
Job Family
Illustrative Jobs
Geographic Defined Labor Market
Scope
Administrative Administrative Specialist, , Local and
 General Industry- For
Regional
& Operations Executive Assistant,
profit
Operations Associate
 Nonprofit
Coach, Assistant Coach, National and
Athletics
 Division III Schools
Athletic Trainer
Regional
(Division I for Hockey)
National and
Health Services Registered Professional
 Healthcare
Nurse, Health Educator, Regional
Counselor
Senior Computer Operator, National
Information
 General Industry – For
Network Technician,
Technology
profit
System Administrator,
 Nonprofit
Web Producer, Application
 Top 25 National
Consultant
Universities
National
Instructional Lab Technician, Lab
 General Industry – For
and Research Manager
profit
Support
Reference Librarian,
National,
Librarian
 Library Professionals
Archivist, Digital
Regional and
Technology Librarian
Local
Management Director, Residence Life, National
 General Industry – For
Registrar, , Bursar,
profit
Director, Physical Plant;
 Nonprofit
Director, Disbursement
 Top 25 National
Operations
Universities
Career Counselor,
National,
Professional
 General Industry – For
Purchasing Agent,
Regional, and
profit
Facilities Engineer
Local
 Nonprofit
 Top 25 National
Universities
Local and
Public Safety Officer I/II, Sergeant,
 Local and Regional
Lieutenant
Regional
National
Scientific and Research Associate,
 General Industry – For
Research Scientist
Research
profit
Environmental
Specialist,
Local
and
Service and
 General Industry – For
Regional
Maintenance Groundskeeper,
profit
Electrician, Plumber
 Nonprofit
Page 7
V. Pay Adjustments
 Performance-Based
Performance-based adjustments are delivered in the form of annual increases,
typically referred to as merit increases. Merit increases are used to recognize and
reward staff who meet or exceed performance standards. Merit increases are not
entitlements, and should be aligned with the staff member’s level of performance.
The annual merit increase budget will be determined by the Division of Human
Resources by considering relevant market data as well as relevant budget
constraints. The Division of Human Resources is responsible for communicating
the merit budget and merit guidelines. Annual merit increases will be effective on
July 1.
Managers will recommend merit increases based on the evaluation of each eligible
staff member. Portfolio owners will be responsible for allocating their merit
budget based on these recommendations, and within the guidelines established by
the Division of Human Resources.
The guidelines for performance-based adjustments or merit increases are directly
tied to the results of the performance management process. Performance
Management is a continuous cycle carried out by the manager. Managers are
responsible for ensuring the work performed by their staff is contributing directly
to the department, division and Institute’s goals and objectives.
The Performance Management Tool (PMT) is used to clearly define job
responsibilities, core competencies, goals and objectives, career
development/improvement plans and job requirements. The PMT is also used to
establish performance standards and measure performance.
Performance standards are the criteria managers use to assess staff performance
and to ensure that results are properly aligned with department, division and
institute goals and objectives. Specification of performance standards is essential
in order for staff to have a clear idea of the basis upon which performance will be
evaluated.
Job performance is considered satisfactory when staff are meeting or exceeding
the established performance standards. Throughout the evaluation period
managers should observe staff performance in relation to the established
performance standards. These observations will provide the information needed
to objectively evaluate and discuss job performance on a day-to-day basis.
Page 8
V. Pay Adjustments (continued)
On an annual basis, Rensselaer requires managers to conduct a formal assessment
of staff performance using the PMT. The performance evaluation is intended to
assess the employee’s effectiveness in performing the duties and responsibilities
in meeting the performance standards and achieving goals and objectives. It is
also intended to provide recognition to staff and encourage staff to develop their
potential by providing a communication tool for the manager and employee to set
attainable goals and objectives.
 Promotion
A promotion is defined as movement to a higher position in the same level or to a
position in a higher level on the same or different career ladder. Staff members
can be promoted either by successfully applying for a new position, or by having
their current position reclassified.
A promotion within level typically represents new responsibilities that are
different from current responsibilities, may require training, and will require the
development of new competencies. A promotion within level will normally
warrant an increase in base pay from 5 to 10%.
A promotion to a higher level on the same or different career ladder typically
represents the addition of significantly greater responsibilities as described by the
standard criteria defined on the appropriate career ladder. A promotion to a
higher level will normally warrant an increase in base pay of 10 to 15%, or to the
minimum of the new pay range, whichever is greater.
 Reclassification
The re-evaluation of occupied positions due to substantial changes in
responsibilities is called a job audit. As a result of a comprehensive evaluation, a
change in grade may occur. A reclassification could result in a position being
moved up or down within the given career ladder. Factors for determining the
salary increases are similar to those that apply in the case of a promotion. To
process a reclassification, the following procedures must be followed:
1. Under the Resource Planning section of the Performance Plan, the Department
Head determines the need to promote an individual and makes the
recommendation to the appropriate cabinet member.
Page 9
V. Pay Adjustments (continued)
 Reclassification
2. As a part of the Resource Planning process, the reclassification request
process must be initiated. The manager is responsible for developing a draft
Performance Management Tool.
3. The draft Performance Management Tool must be submitted along with a
revised organizational chart and a Request for Reclassification Form to the
Division of Human Resources for salary, title and FLSA determination.
4. In order for the request for reclassification to be finalized, it must be approved
by the Division of Human Resources, incorporated in the approved
Performance Plan and included in the approved Budget.
5. At the time that the manager wishes to effect the reclassification, the approved
reclassification form, an electronic copy of the final Performance Management
Tool and a transaction form must be submitted to the Division of Human
Resources.
6. The Division of Human Resources will generate a letter to the staff member to
confirm the reclassification.
 Equity Adjustment
Equity adjustments may be requested when a classification level is correct, but the
salary is low in comparison to the external marketplace and/or to others, usually in
the same level, with similar credentials and have comparable responsibilities and
experience.
 Special/Premium Pay
The following are guidelines to assist managers in making decisions regarding
premium pay. Premium payments are discontinued at the conclusion of the
assignment or other special circumstance.
1. “Acting” Pay
A staff member who is assigned to a higher-level position on an interim basis or
who assumes significant duties in addition to their regular job, may receive an
interim pay increase of 5 – 15% if the interim period is at least 30 days. Any
proposal to temporarily increase a staff member’s pay under these circumstances
must be approved in advance by the Division of Human Resources.
Page 10
V. Pay Adjustments (continued)
 Special/Premium Pay
The following steps will facilitate this process:
a) The manager must provide the Division of Human Resources with an
outline of the additional duties assumed, the duration of the interim
appointment and the source of funding.
b) The Division of Human Resources will determine the appropriate pay
adjustment, and notify the manager. Typically, interim pay adjustments
will be between 5 and 15% of the staff member’s base pay.
c) The manager must complete a transaction form and obtain the required
signatures.
d) The Division of Human Resources will generate a letter to the staff
member.
2. Shift Differential
The differential paid to nonexempt employees working in certain designated
positions that are regularly scheduled to work during the second or third shift.
Such differential will be considered as part of the overtime calculation if the
total hours worked in a week exceed 40. Please refer to the HR Policy
Guidelines for the complete on-call policy.
3. On Call Pay
Rensselaer may require non-exempt employees to be available to return to
work beyond their normal work schedule. These employees are considered to
be on-call. Employees assigned to on-call are required to be accessible if it is
necessary for them to return to work. Please refer to the HR Policy Guidelines
for the complete on-call policy.
4. Call In Pay
A non-exempt employee will receive a minimum of four hours pay for each
call-in occurrence. The four hours will be added to the total hours worked for
the week, and typically will result in a full time employee in a paid status
being paid time and a half for the call-in hours. Please refer to the HR Policy
Guidelines for the complete on-call policy.
Page 11
V. Pay Adjustments (continued)
 Special/Premium Pay
5. Supplemental Pay
At times, exempt employees may be requested to perform work that is
separate and distinct from the employee’s regular job classification duties
and responsibilities or outside of their department. It is Rensselaer’s policy
that this work should be performed by adjusting the workload of the employee
so that the work can be performed without supplemental compensation.
Where the supplemental duties cannot be performed by adjusting the
workload and the need to perform the work is critical to a project,
supplemental payment may be granted if the work is a short-term project,
and the duties are performed over and above the individual’s primary job
duties. Supplemental work will normally be performed evenings and
weekends.
A request for supplemental pay must be processed on the Exempt Staff
Supplemental Pay Authorization form. This form must be signed by the
employee, the employee’s immediate supervisor, the hiring department
supervisor, Dean or Director and Vice President or Provost. The Exempt Staff
Supplemental Pay Authorization form must contain the hours of work required
and the estimated rate per hour or flat fee as approved by Human Resources.
Non-exempt employees are paid on an hourly basis for hours worked. Hours
worked in excess of 40 hours per week must be compensated at time and a
half. Time worked on supplemental assignments is not a separate entity but a
combination of the regular job and supplemental duties and will be computed
as such. Please refer to the HR Policy Guidelines for the complete
policy.
Page 12
VI. Roles & Responsibilities
The Division of Human Resources, managers/supervisors, and staff all have a role to
play in maintaining the compensation program and ensuring that the program is fairly
and consistently managed.
Role of the Division of Human Resources
1. Provide expert guidance, perspective, and support to enable managers and
supervisors to make appropriate pay decisions
2. Communicate programs and guidelines to help managers and supervisors
understand all aspects of the compensation program
3. Identify, collect, and analyze external market data in order to ensure alignment
of Rensselaer’s compensation policy and practice with it’s Compensation
Philosophy
4. Maintain the competitiveness of the staff compensation structure by reviewing
the market trends annually and, when appropriate, making adjustments to the
structure to reflect market pay levels
5. Evaluate and determine appropriate job family, level, title, exempt/nonexempt classification (FLSA Status) and salary range for each new position
and for each request for reclassification
6. Apprise senior administration of compensation practices across Rensselaer
7. Maintain performance management tools for each staff position on campus
8. Ensure compliance with applicable laws and regulations
Role of Managers and Supervisors
1. Incorporate compensation administration guidelines into their performance
planning and budget planning processes
2. Identify and correct compensation inequities
3. Apply established guidelines to maintain equitable pay practices within their
areas of responsibility
4. Determine hiring rates and advancement increases based on established
guidelines
5. Recommend performance-based merit increases within established guidelines
6. Communicate the compensation program, and any future changes, to their
staff
7. Provide open, honest, and timely feedback to their staff on compensation
issues, answering both specific and general questions about pay
8. Work with their staff to keep the Performance Management Tools (PMT)
current
9. Use HR as a resource to ensure appropriateness of pay decisions and
consistency with broad pay guidelines
10. Ensure compliance with applicable laws and regulations
Page 13
VI. Roles & Responsibilities (continued)
Role of Staff Members
1. Use the tools and resources that Rensselaer makes available to understand the
compensation program (e.g. written materials, town hall meetings, HR
website)
2. Discuss questions or concerns with their manager/supervisor
3. Work with their manager/supervisor to keep their PMT updated.
VII. Filling a Position
Newly Created Positions
All new positions must be approved through the annual Performance Planning and
Budget process. The following procedures must be followed:
1. Under the Resource Planning section of the Performance Plan, the Department
Head determines the need for a new position and makes the recommendation
to the appropriate cabinet member.
2. All positions proposed during the performance planning process are submitted
to the Division of Human Resource for salary, title and FLSA determination
for inclusion in the proposed budget.
3. If the new position is approved in the Performance Plan and in the Budget, the
position is considered approved.
4. Prior to beginning the search process, the hiring manager is responsible for
developing a Performance Management Tool (PMT).
5. The Performance Management Tool must be submitted to the Division of
Human Resources for confirmation of job level, title and FLSA status.
6. The hiring manager initiates the search process by completing a Position
Approval Form (PAF). (Refer to the HR Policy Guidelines for the position
justification and hiring process.) Once a candidate has been selected,
managers should use hiring zones (as indicated on the chart on the following
page) to establish the appropriate starting salary within the established hiring
range. Salary offers that are outside of the hiring range must be approved by
the Division of Human Resources.
Page 14
VII. Filling a Position (continued)
Hiring zones have been established within each salary range as follows:
Zone 1
Developing
Minimum to first quartile




This is the entry pay
zone for less
experienced
individuals
Little or no direct
specific experience
Candidate may
possess knowledge
and skills, that, while
not directly related,
are transferable to the
position
Possesses some of the
desired competencies
for the job



Hiring Zones
Zone 2
Market Zone
First to second quartile
Has applicable job experience
Possesses required knowledge,
skills and competencies
Expected to perform all/most
aspects of job effectively and
independently with a minimal
learning curve

Zone 3*
Performance Zone
Second to third quartile
Has had recent and
progressively
responsible job
experience in a directly
related position.
 May demonstrate unique
knowledge or skill
 Expected to contribute
significantly to the
position with little to no
learning curve
* Division of HR approval
is required to make an offer
in Zone 3
Page 15
VII. Filling a Position (continued)
Evaluation of Vacant Positions
1. Under the Resource Planning section of the Performance Plan, the Department
Head determines the need to reclassify a vacant position to a different level,
and makes the recommendation to the appropriate cabinet member.
2. Prior to beginning the reclassification request process, the hiring manager is
responsible for developing a Performance Management Tool. The
Performance Management Tool must be submitted along with a completed
Request for Reclassification form to the Division of Human Resources for
salary, title and FLSA determination.
3. In order for the request for reclassification to be finalized, it must be approved
by Human Resources, incorporated in the approved Performance Plan and
included in the approved Budget.
The hiring manager initiates the search process by completing a Position Approval Form
(PAF). Once a final candidate has been identified, managers should use hiring zones to
establish the appropriate starting salary. Salary offers that are outside of these hiring
zones must be approved by the Division of Human Resources prior to any offer being
extended.
The Division of Human Resources may consider whether providing a pay increase,
typically up to 5%, is appropriate when an employee is moving into a new position within
the same level. In all cases, managers or the appropriate department administrator should
consult with the Division of Human Resources for guidance in making an informed
decision. No commitment should be made to employees regarding salary prior to having
a conversation with Human Resources.
Evaluation of Occupied Positions
The Institute encourages lateral movement. It is essential that we develop and utilize our
employee talent optimally and cross-train employees so that they may continue to add
value to the organization. It is also highly beneficial to individual employees, as lateral
movement broadens their base of knowledge and enhances their professional growth
potential.
Page 16
VII. Filling a Position (continued)
When it is determined that the position the employee is transferring to requires new
and/or additional skills, and is more complex than the position the employee is
transferring from, an increase may be appropriate. The hiring manager/department
administrator should be able to articulate what those new skills are, and/or how the
particular complexities of their department are different from those of the department the
employee is transferring from. This is important so that, if necessary, the logic of the
decision can be made clear to others. For example, a change in scope may mean that the
employee's prior position did not include financial and budget responsibilities, but in the
new position these responsibilities are a regular part of the job.
Transfers to a Position at a Lower Level
It may at times be necessary for a staff member to transfer to a position in a lower job
level. This most likely will occur as a result of a more appropriate fit between the staff
member and the skills and competencies of a job in the lower category. In this case pay
will be managed within the parameters of the salary for the new position. If the
transferring staff member’s current salary is above the maximum of the new range, the
staff member’s salary will be reduced to the new maximum.
Transfers that are the result of a search are processed using an employment transaction
form. The following guidelines must be followed to process a transfer within the
department:
1. Under the Resource Planning section of the Performance Plan, the Department Head
determines the need to transfer an individual and makes the recommendation to the
appropriate cabinet member.
2. As a part of the Resource Planning process, the reclassification request process must
be initiated. The manager is responsible for developing a draft PMT
3. The draft Performance Management Tool must be submitted along with a revised
organizational chart and a Request for Reclassification Form to the Division of
Human Resources for salary, title and FLSA determination.
4. In order for the request for reclassification to be finalized, it must be approved by the
Division of Human Resources, incorporated in the approved Performance Plan and
included in the approved Budget.
5. At the time that the manager wishes to affect the transfer, the approved
reclassification form, an electronic copy of the final Performance Management Tool
and a transaction form must be submitted to the Division of Human Resources.
Page 17
APPENDIX
Frequently Asked Questions
Q. Why does Rensselaer have salary range minimums and maximums?
A. The minimum and maximum of a salary range are determined by market pricing jobs and
represent the lowest and highest salary paid for a given position. The spread between the
minimum and maximum is less for the lower-level positions. It expands in higher-level
grades to reflect the increased complexity and responsibility of jobs and the knowledge
required. As such, it should take longer to reach the midpoint in higher-level than in lowerlevel positions.
Q. Are there methods of rewarding employees for temporarily taking on additional
responsibilities or for special projects?
A. Yes. Please see the Supplemental Pay policy.
Q. How is it determined whether a job is exempt or non-exempt?
A. The term non-exempt refers to provisions of the Fair Labor Standards Act. Non-exempt
positions are subject to specific minimum wage, time keeping, and overtime requirements;
exempt positions are not subject to these regulations. Exempt positions are defined by
criteria describing the nature of the duties, minimum compensation allowable, and the degree
of judgment and decision making required. Job Titles alone are insufficient measures for
determining exempt status.
Q. How do I get promoted?
A. Rensselaer supports career growth and development for employees by growing new skills
and competencies. Employees are encouraged to take advantage of professional development
opportunities on campus. Employees should work with their managers ring the PMT process
to develop career goals that are aligned with the Rensselaer Plan.
Q. Why is a new employee sometimes paid as much as a current employee?
A. This occurrence, called salary compression, occurs if inflation and/or changing market
conditions outpace your salary increases. Rensselaer addresses this problem through equity
adjustments.
Page 18
APPENDIX
Frequently Asked Questions
Q. What forms and signatures are required for different personnel actions?
Action
Evaluation of new
positions
Evaluation of
existing vacant
positions
Evaluation of
existing filled
positions
Initiate a Search
Establish employee
record on payroll
Forms Required
1. Performance Planning and
Budgeting New Positions and/or
Positions Reclassification
Request Form
2. Organizational Chart
1.Performance Planning and
Budgeting New Positions and/or
Positions Reclassification
Request Form
2. Request for Reclassification
3. Performance Management
Tool
4. Organizational Chart
1. Performance Planning and
Budgeting New Positions and/or
Positions Reclassification
Request Form
2. Request for Reclassification
3. Performance Management
Tool
4. Organizational Chart
5. Employee Transaction Form
1. Position Approval Form
2. Performance Management
1. Employment Transaction Form
Signatures
Academic Portfolio
Portfolio Owner,
Provost
Administrative Portfolio
Department Head,
Cabinet Member
Department Head,
Portfolio Owner,
Provost
Department Head,
Cabinet Member
Department Head,
Portfolio Owner,
Provost
Department Head,
Cabinet Member
Department Head,
Portfolio Owner,
Provost
1.
Department Head,
Portfolio Owner,
Provost
Department Head,
Portfolio Owner,
Provost
Department Head,
Portfolio Owner,
Provost
Page 19
Glossary of Terms
base pay – The amount of money you can expect to earn working your regular schedule
without any overtime, extra pay, fringe benefits or deductions (see total compensation).
benchmark job – A job that is defined in the same way, or nearly the same way, across many
organizations and for which market pay comparisons can be made simply by using the job’s
title or a short description.
compensation strategy/philosophy/policy – The principles that guide design,
implementation and administration of a compensation program. The strategy ensures that a
compensation program, consisting of both pay and benefits, supports an organization’s
mission, goals and business objectives. It also specifies what programs will be used and how
they will be administered. The philosophy ensures that a compensation program supports an
organization’s culture. The policy ensures that a compensation program carries out the
compensation strategy while supporting the compensation philosophy.
competencies – Behaviors that contribute to and predict superior performance, i.e., how one
performs a job rather than what is done.
exempt – A term referring to those jobs or groups of employees – executives, administrative
employees and professionals – that are not covered by the minimum wage and overtime
provisions of the Fair Labor Standards Act.
Fair Labor Standards Act (FLSA) – A federal law governing minimum wage, overtime
pay, equal pay for men and women in the same jobs, child labor, and recordkeeping
requirements.
job category – A designation for differentiating between roles and responsibilities across
positions.
job classification – A grouping of jobs having similar duties and responsibilities and
assigned to the same job category.
job description – A summary of key features of a job and of the credentials required to
perform the job. This is the PMT tool.
job title - A job title is the descriptive name for the total collection of tasks, duties and
responsibilities assigned to one or more individuals whose positions have the same nature of
work performed at the same level.
market study – An analysis to determine the rates other organizations pay for specific jobs.
Page 20
Glossary of Terms
merit increase – An adjustment to individual salary based on performance.
merit rating – A method for appraising the performance of an employee with respect to his
or her job. It frequently serves as a basis for making pay adjustments, promotion decisions, or
reassignment of work.
minimum wage – The lowest allowable hourly pay level established by Congress as part of
the Fair Labor Standards Act. Some states have laws that mandate higher minimum wages
for some employees.
non-exempt – Jobs or employees that are subject to the minimum wage and overtime pay
provisions of the Fair Labor Standards Act.
overtime – Under the Fair Labor Standards Act of 1938, non-exempt employees must be
paid one-and-a-half times their normal wage rates for all hours worked in excess of 40 in any
work week.
pay administration – An organization's policies and guidelines for setting and adjusting
rates of pay.
pay equity – A concept that refers to internal or external equity. Internal equity is the
fairness of one's pay relative to others performing similar work, taking into account
differences in performance, length of service or other factors. External equity is the
competitiveness or fairness of an organization's salaries relative to the external labor market.
pay for performance – A reward system that relates pay to an individual's fulfillment of
expectations or objectives (see performance-based increase).
pay zones – Ranges of pay used to hire employees that can keep the system more structurally
intact. Maximums, midpoints, and minimums provide guides to appropriate pay for certain
levels of work.
performance-based increase – A pay increase typically granted annually that rewards an
individual's performance or accomplishments in the prior period. A performance-based
increase amount/percentage can vary from employee to employee based on his or her
performance and other factors (see pay for performance).
performance review – The step in the performance management process in which a
supervisor evaluates his or her employee’s performance and achievements relative to
expectations.
Page 21
Glossary of Terms
performance management/partnership – A systematic approach to planning, coaching,
evaluating, and rewarding individual and/or team performance with the overall objective of
improving the level of performance across Rensselaer. It involves collaboration between an
employee and his or her supervisor in goal setting, ongoing feedback on performance, formal
performance appraisal at the end of the performance period and career development.
Performance Management Tool (PMT) – A comprehensive document that outlines the
duties and responsibilities, core competencies, qualifications and skills for a specific position
and is used as the basis for performance evaluation.
range minimum - The lowest pay rate Rensselaer is willing to pay for a position.
range midpoint – Typically reflects median pay in the competitive labor market.
range maximum – The highest pay rate Rensselaer is willing to pay for a position.
salary range – The range, expressed as the minimum, midpoint and maximum, that
Rensselaer will pay for jobs assigned to it.
salary survey – A process to assess rates other organizations are currently paying for
specified jobs (see market study).
skills – Measurable abilities to perform job-related functions, such as word processing,
computer programming, etc.
total compensation – The total of one's base pay plus other cash compensation and the value
of non-cash fringe benefits such as employer-paid pension contributions, insurance
premiums, and tuition reimbursement (see base pay).
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