One Way Managers Can Boost Staff Pay
By Katherine Ward
Until five years ago, employees were dependent on state-determined, across-the-board pay increases, unless their duties changed markedly and their managers felt that a job reclassification was in order.
Since October 2000, however, a number of U.Va. employees have benefited not only from state-mandated pay increases, but also from
in-band adjustments — 3,023 to be exact — given by their departments following approval from various levels of institutional management. These adjustments represent the University’s nearly $10 million investment in its academic division workforce of 4,600.
|FIVE-YEAR REPORT CARD ON NEW PAY PLAN
|3,023 in-band adjustments have been awarded since October 2000. Fewer than 15 percent of these have gone to employees more than once.
||The average IBA adds an additional $3,238 to an employee’s salary, including fringe benefits.
||Pay band 3, the pay band under which most employees fall at U.Va., has received the highest number of in-band adjustments, 43.27 percent.
||U.Va. has awarded more than $1 million and almost 1,700 days off to employees under the new pay plan’s rewards and recognition program.
HOW DID IN-BAND ADJUSTMENTS COME ABOUT?
Virginia’s statewide compensation plan changed drastically five years ago. “This was the first major change to take place in 40 years,” said Tom Gausvik, chief human resource officer. The state went from having 2,000 job classifications and 23 pay bands to having 330 broad job roles and nine pay bands.
Also instituted were in-band adjustments, a way to compensate classified employees by increasing their salaries, as much as 10 percent per fiscal year, within their current pay band.
Under the old compensation plan, “there was no horizontal movement within your pay band range,” Gausvik said. The only way to get an increase, above the 2 percent to 3 percent annual raise issued most years by the state (though there were times when the state gave no increases), was to get promoted or reclassified to a new pay band, he said.
WHO GETS CONSIDERED FOR IN-BAND ADJUSTMENTS?
There are four reasons that a manager would consider a classified employee for an in-band adjustment:
- if the employee’s duties change;
- for retention purposes — when the employee is in a job with high turnover and the department faces recruitment difficulties;
- for internal alignment, which takes into consideration the proximity of one employee’s salary to the salaries of others who have comparable levels of training and experience; or
- if the employee receives additional education and/or training that leads to demonstrated performance.
In-band adjustments are completely manager-driven, Gausvik said. “This is a tool for management to use to be able to retain workers, and it’s up to the managers with regard to how they use it.
“There is no recipe from an employee perspective for receiving an IBA. … There is no way to punch a ticket and do X-Y-Z to get one,” Gausvik said. It is, however, something that employees can discuss with their managers at any time, to perhaps devise work plans that could lead to in-band adjustments.
HOW OFTEN ARE IN-BAND ADJUSTMENTS GIVEN?
“U.Va. has been very aggressive … in using this pay plan to compensate its classified employees,” Gausvik said. “During the last four-and-a-half years, we have provided to our [academic division] workforce of 4,600 employees two times the average of the state’s number for
- 3,023 IBAs have been awarded since October 2000. Fewer than 15 percent of these have gone to employees more than once.
- The IBAs issued, including fringe benefits, have cost U.Va. just under $10 million.
- The average IBA adds an additional $3,238 to an employee’s salary, including fringe benefits.
- Pay band 3 has received the highest number of in-band adjustments, at 43.27 percent. Next is pay band 4, at 21.59 percent. Most employees at U.Va. fall into pay band 3.
In-band adjustments occur quarterly (in January, April, July and October). The process begins with the manager who wants to compensate an employee. That manager talks with his/her manager and/or HR liaison and completes the necessary paperwork. The employee should know nothing about the proposed IBA during this process, as to not create expectations in case the IBA is denied or its amount is less than requested, Gausvik cautioned. The paperwork is submitted to the manager’s department head, who, upon approval, advances it to his/her boss. Eventually, vice presidents review their proposals and, if approved, forward them to central HR for processing and final review to ensure that there is no major impact across organizational units.
Gausvik noted that, despite the layers, once the paperwork gets to central HR, the process only takes 30 days. As of now, HR has one analyst who handles this task. Another two analysts handle classification actions.
REWARDS & RECOGNITIONPART OF NEW PAY PLAN
Another feature of the new pay system is the rewards and recognition policy. A classified employee can receive up to $1,000 per fiscal year through the program, and five days of additional leave time. U.Va. has awarded more than $1 million to employees under this program since October 2000, and awarded almost 1,700 days off. Under the old pay plan, pay and leave time bonuses did not exist.
OTHER WAYS TO GET SALARY INCREASES
- Role changes. A job can be reclassified to a higher pay band if the duties of the position warrant it. (This does not occur on a quarterly cycle.)
- Job changes. An employee can apply for a vacant position within the institution at a higher pay level, or one can apply for a vacant job position at the same level.
- Competitive offers. If an employee receives a job offer from another company for more than they currently make, the department may make a counteroffer to retain the employee.
In the new plan, employees continue to receive pay increases from the state. This year’s increase, to take effect Nov. 25, will provide a
3 percent increase for classified employees, plus an additional $50 more per year of service for those with five or more years of service. This means, for example, that an employee who has worked at U.Va. for 10 years and earns $30,000 annually, would get a 3 percent increase ($900) and an extra $500 ($50 per year times 10 years of service) added to his or her salary. The University is still waiting for final guidance from the state with respect to this increase.
Gausvik also noted that only 13 percent of money for classified staff salary increases comes from the state. The rest comes from tuition, research grants and auxiliary funds. In the hypothetical example above, U.Va. would spend another $10,530 on top of the $30,000 salary for fringe benefits, he said.
For more information about benefits and pay increases, check out the HR Web site at http://www.hrs.virginia.edu.