Staff Compensation Program Manager Training May 21 – 22, 2012
Why Focus on Compensation? Georgia College’s Compensation Program Re-Design ensures the institution remains an employer of choice through: • Alignment of pay with the philosophy and goals of GC • The recruitment and retention of top talent • Recognition of employee contributions to their jobs • Pay aligned to our competitive market • Internal equity in pay among our employees The University is committed to providing employees with market competitive pay and opportunities to grow and develop within our institution.
Outdated pay system Last system update in 2005 Last comprehensive staff compensation analysis in 2001 Inaccurate job descriptions Continued concerns around: Inconsistent administration of pay Pay compression Misalignment of pay to the external market Internal inequity Pay may not be linked to individual contributions Limited career progression opportunities Competitive, market-based structure Policies for pay administration to ensure: Fairness and consistency across the institution Ongoing maintenance of program Foundation for future HR initiatives Performance management Career progression Increased communication and transparency Overview of the Staff Compensation Program Old Compensation Program New Compensation Program
Outcomes of the New Program Key outcomes of the new program include: • Current & Accurate Job Descriptions: Documentation of key responsibilities, skills, education, and experience requirements for the job • Compensation Philosophy: Description of the role of pay and GC’s expectations for the management of pay in attracting, retaining, and rewarding employees at the University • Comparison Markets: Development of comparison markets for market data comparisons by broad employee level groupings • Compensation Structure: Management of compensation through market-based salary grade ranges • Compensation Policies: Policies for managing compensation at the University to help ensure internal equity and consistent application of the program The final materials for the items above will be available in June on the Human Resources website (http://www.gcsu.edu/equity/payupdates.htm).
Project Phases The objectives were accomplished through the following four phases: Phase 1: CompensationPhilosophy August – November 2011 Phase 2: Market Assessment November 2011 – January 2012 Phase 3: Salary Structure and Salary Administration Guidelines Development January– May 2012 Phase 4: Program Implementation and Training May – June 2012 • Survey on current compensation program perspectives • Key stakeholder and committee interviews • Compensation philosophy development, including comparison markets to be used in market assessment • Approach and process for market assessment • Detailed market pricing analysis • Assessment of GC pay against market • New pay structure for exempt and non-exempt employees • Validation and finalization of structure and job assignments with leadership • Salary administration guidelines development • Implementation plan, including training and ongoing communications • Finalized salary adjustments • Manager and Employee Training sessions Full implementation of the new compensation program will occur on July 1, 2012.
Compensation Philosophy Vision for the Staff Compensation Program The program1is intended to provide competitive, fair, and equitable salaries in order to attract, retain, and engage highly qualified administrators and staff without regard to race, color, religion, sex, sexual orientation, national origin, age, disability, veteran status, or any other legally protected status. The principles of this program are intended to cover all non-faculty jobs.2 How The Vision Will be Realized Program Model GC’s staff compensation program will be designed to provide organization and structure to the way in which salaries are administered, while allowing for sufficient flexibility to meet the needs of the University. To this end, GC will: • Provide pay opportunities/ranges that: • Are based on job responsibilities (not individuals) • Are competitive within the markets in which the College competes for talent • Promote internal equity across the institution • Consider the institution’s financial resources • Recognize and compensate expertise, sustained contributions, and performance • Manage salaries for all divisions and schools using the same program and guiding principles 1 Pay components of the compensation philosophy are contingent upon the financial resources of the institution. 2 Non-Faculty Jobs: All GC jobs in which the individual’s administrative, non-teaching responsibilities represent at least 50% of full-time effort.
Compensation Philosophy continued Pay Components • Base salary will be the primary method of compensating individuals at GC. It will reflect the value of the job in the market, the role in the University, and the capabilities and contributions of the individual • Any other additional pay, when permitted, may be granted in accordance with established guidelines • Other benefits such as tuition remission, health and retirement plans, and work environment will continue to be essential components of the compensation strategy at GC, as a complement to competitive salaries Internal/External Valuation • GC will consider both the external competitiveness and internal valuation of jobs. The program will use market data as a reference for creating the salary structure and salary ranges. Pay will be competitive in aggregate • Benchmarking to comparison markets will inform salary ranges, and will be used as a reference for determining salaries for individuals • Each school will strive to maintain internal equity across the institution. This is defined as providing similar compensation opportunities for similarly situated administrators and staff (i.e., jobs with similar market values in the same job family will be assigned to the same salary grade; administrators and staff with similar expertise, experience, and performance will be paid similarly)
Compensation Philosophy continued Link to Performance • The structure will help support and facilitate a linkage between compensation, career development, and performance management • The University intends to support a culture of performance and reward individuals accordingly • Individual base salaries will be managed within the salary range for the job and will consider the skills, knowledge, experience, and performance of the incumbent • Salary increases should be determined by the degree to which each individual contributes to GC, department, or area goals depending on the job, and demonstrates excellence in handling their job responsibilities, as documented in the performance evaluation process • Salary increases and opportunities for advancement will not be an entitlement and will be subject to the institution’s fiscal conditions • Position and job descriptions will be reviewed and updated as necessary to ensure clear, mutual understanding of responsibilities and performance standards Communication/Openness • GC will ensure understanding of the compensation program through open, clear, and accessible communication to staff • The link between job performance, goal achievement, and salary increases will be clearly communicated to all employees • Managers will be trained and held accountable for effectively planning, managing, coaching and evaluating the performance of their staff, as well as creating a positive work environment that supports growth and staff development
Compensation Philosophy continued Management of the Program • The program will be maintained by: • Monitoring the market on a regular basis • Regular updates to the salary structure to reflect market influences • Regular reviews of salaries to ensure internal equity
Compensation Philosophy continued COMPARISON MARKETS
Compensation Program Development Process The development of the compensation program followed best practice within Higher Education. Understanding Job Content and Job Matching Analyzing the Market Building the Salary Structure DevelopingPolicies • Used updated job descriptions to match GC jobs against competitive market data • Based matching on job content, requirements, scope of accountability, and institutional size • Matched to survey description if 70% of job content was aligned • Collected national, local, higher education, and general industry data • Collected 25th, 50th, and 75th percentile market data • Used only quality credible sources of data • Reviewed matches with HR and Vice Presidents • Developed structure with: • 13 salary grades • Competitive salary ranges • Wide range spreads to allow for growth within a job • Placed benchmarked jobs by market value and internal relationships; placed non-benchmark jobs by internal relationships • Validated job assignments to grades with Vice Presidents • Developed new policies to: • Help ensure fair and consistent salary administration • Establish competitive and equitable salaries • Reward performance and support career growth
Georgia College’s Compensation Structure ($000) • 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 jobs in the grade increases • The salary grade helps maintain competitiveness with the external market and ensures internal equity among compensation for jobs and individuals at the University
The New Compensation Policies Compensation policies address a variety of situations. Help Ensure Fair and Equitable Administration of Salaries Reward Performance and Support Career Growth • Paying within the grade • Starting salaries • Annual salary increases • FLSA • Maintaining the program • Promotion • Transfers • Temporary assignments/ interim appointments New compensation policies will be found on the GCHR website in June.
Management of Pay within the New Structure An individual’s grade, skills, experience, and performance determine the actual salary for the job. Role, Responsibilities, and Skill Requirements Knowledge, Skills, Experience, and Performance Pay Opportunity + = Grade Location inGrade RecommendedBase Salary + =
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 • February 1st (completed): Select employees whose salaries significantly lagged the pay for their job in the external market received increases • August 1st: Employees whose pay are below the grade minimum will be brought to the minimum • Employees will continue to be eligible for annual merit increases as part of the compensation program
Implementation Details Implementation • New Individual Employee Letters: Distributed June 2012 • Contents include: • New salary grade and range • Salary adjustments (if applicable) • Title changes (if applicable) • Managers will distribute the individual employee letters. Following the distribution of the letters, GC HR encourages managers to have one-on-one meetings with employees to review the contents and discuss any questions
Re-Evaluation Schedule The table below describes key dates and actions for a job re-evaluation.
Managers are Critical to the Program’s Success YOUR RESPONSIBILITIES AS A MANAGER/SUPERVISOR Follow Compensation Policies Understand and Support the Program • What you should know • How and why the program was developed • The program’s objectives and key messages • Compensation policies and how to use them • What you should do • Use the salary policies in consultation with Human Resources to determine appropriate hiring salaries and to manage salaries appropriately • Keep job descriptions current for your employees • Stay informed about the policies Help Your Employees Understand the Program Compensation Policies will be available online soon • How you should communicate • Be positive about the program • Answer employees questions openly and honestly • Research any questions you are uncertain about • Enlist HR’s help
Manager Tools and Resources for Implementation • Today’s presentation • Employee Information Session presentation (sessions to be held June 4th and 5th) • Manager script – “Do Say This, Don’t Say That” • Manager FAQs – As the trainings are complete, Human Resources will compile all the questions and distribute an updated FAQ for you prior to the distribution of the employees letters • Human Resources website • Human Resources—call or email email@example.com if you have questions
Example Manager File The table below is an example of the file you will be reviewing with HR. It outlines the compensation information of your direct reports.
Frequently Asked Questions Q. How many salary grades are there? A. There are thirteen broad salary ranges. This information will be available on the GCHR website in June. Q. How was I assigned to my new grade? What considerations were taken into account? A. Information related to jobs, not individuals, was obtained through current job descriptions. Information about job content, job requirements and scope of accountability was compared to the same job information from several surveys sources. The results of this process were approved by Vice Presidents. 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 GC jobs and to match those jobs to the survey jobs. Benchmark jobs were placed in a grade based on market value and internal relationships, while non-benchmark jobs were placed in a grade by internal relationships. The grade placement of all jobs was validated by Vice Presidents. All grade level determinations are final.
Frequently Asked Questions continued Q. How can I find out what grade my job is and if I will receive an increase? A. All employees will be notified of their grade and salary adjustment (if applicable) in a letter that they will receive from their managers in June. 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 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 job in a higher salary grade, which provides for a significantly broader role, will generally be recognized by a salary increase. Annual merit 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 jobs will not change. Titles for a small group of jobs will change based on a review of the updated job descriptions and recent department re-organizations.
Frequently Asked Questions continued Q. Who from the University was part of the development of this program? A. The President, President’s Cabinet, Compensation Study Committee, and HR Project Team. Please see website for further details on participants of each group. Q. Will survey data for job matches be shared with incumbents? A. No, the survey data is confidential. The survey data was used, and will continue to be used appropriately by GCHR 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.
Practice Exercise Please pair up with a colleague and follow the steps below: • Have one person be the employee and one be the manager • The employee will ask a question to the manager about this new compensation program • The manager attempts to answer the question • Repeat exercise for the next 10 minutes • At the end of the 10 minutes, share the questions and any successes or difficulty in answering the questions with the whole group. This discussion will help inform revisions to the FAQs