EXECUTIVE SUMMARY

FINAL REPORT OF THE JOINT COMMITTEE TO DESIGN A PROFESSIONAL SALARY SYSTEM

February, 1996

METHODS:

(Page 3 of Final Report)

The 1990 UMPSA/UMS contract provided for the selection of a consultant to work with the Committee to design a point factor system. Based on proposals and presentations to the Committee, the Wyatt Company, an international consulting firm, was selected from four companies responding to a May 1990 Request for Proposals. Wyatt was hired to work with the committee to:

Data Collection: A Snapshot of UMS Jobs

(Pages 4-5 and 7-8 of Final Report)

The most comprehensive task for the Committee was to generate data about the job content of existing positions to use to develop a salary system. With Wyatt's guidance, a questionnaire was designed, field tested, and administered. The results were extensively reviewed for internal and external consistency. Ultimately, they provided a "snapshot in time" of UMS professional positions. These data were used in conjunction with national and regional salary information to generate the weights of job content factors which measure major position characteristics. In this job evaluation model, the factors are knowledge, problem solving, contacts and communication, planning, supervision, change, environment, and organizational relationship.

Job Evaluation: The Model

(Pages 4-5 and 10-11 of Final Report)

The proposed salary system is based on a statistical model which uses questionnaire responses to predict a "point value" for each position. An equation assigns a weight to each individual response or a combined group of several responses. The sum of all the weighted responses determines the point value. The point value places the position in a salary grade which is a broad range of salaries flexible enough to capture differences in individual qualifications as well as job content.

The weights used in the model are determined statistically. They do not reflect any individual judgments or biases about point values and resulting salary ranges. The weights are those which most accurately predict the market hierarchy, i.e. the order in which these positions are valued in the hiring market.

Job Evaluation Program: WyCOMP^TM

(Pages 6-7 of Final Report)

The job evaluation program is supported using Wyatt's WyCOMP software. WyCOMP is a PC- based package which integrates market data, salary structure design, salary planning, and job evaluation based on the UMS statistical model.

The WyCOMP software is designed to derive a point value for each position rather than a market currency value for the job. Using points rather than salary allows the salary structure dollar amounts to be adjusted as market conditions change while point values remain stable. This results in a model that can be efficiently maintained while still being sensitive to changes in the market.

SALARY STRUCTURE:

(Pages 12-13 of Final Report)

The point value generated from the job evaluation process places a job within one of several salary grades, each with an associated minimum, midpoint, and maximum salary assigned to the grade. The point value determines the salary grade, but does NOT determine the salary directly. Individual salary determination must also reflect the specific qualifications of the employee. The actual salary within the grade for the job is determined at the campus using criteria such as the employee's qualifications and experience, the responsibilities of the position relative to other positions within the same grade, employee performance level, external market factors, and internal (inter and intra-campus) equity.

The number of grades and the minimum and maximum salaries for each grade may change over time. Such changes, for example, may be made to reflect collective bargaining agreements and/or to accommodate new market data.

The Committee considered salary range differentials between campuses. Those favoring such differentials cited differences among the campuses in missions and salary setting practices, as well as considerable differences in the hiring and cost of living markets within which each campus operates. Others felt that the job content analysis and the flexibility built into the salary system sufficiently captured legitimate differences without requiring explicit campus differentials.

Wyatt advised the Committee that geographic differentials were not typically used in professional salary structures. The campuses usually recruit statewide or nationally. Differences in position responsibilities such as decision making autonomy, reporting relationships, budget size, and variety of duties (specialists versus generalists) are already captured in the job evaluation model. The Committee has therefore not incorporated campus differentials in the salary structure.

The dollar amounts to be assigned to each grade must be determined before implementation. The initial salary structure uses salary data from 1990 and earlier that was aged to early 1991. Wyatt strongly urges that a market review be conducted, and the salary ranges updated to reflect 1995/96 salary rates.

After updating for the market, the dollar amounts may be further adjusted to reflect any targeted pay policies that may be set by the University of Maine System Board of Trustees for UMS professional employees.

SALARY ADMINISTRATION:

(or How The System Works)

(Pages 16-17 of Final Report)

The Joint Salary Study Committee has developed procedures for administering the recommended job evaluation system in the following areas: development of the

position description; evaluation of the job; determination of the appropriate salary grade for the job; placement of the job at a specific salary within the grade; and annual review of the position description. If there have been significant changes in duties or responsibilities, the process is repeated with a new evaluation of the job through the completion of the Questionnaire for Professional Jobs.

The administrative procedures delineate policies for placing individual salaries within a salary range as follows:

"Employee salaries placed near the minimum usually reflect employees new to the position or the University, who meet minimum qualifications but may not have preferred qualifications. Employee salaries near the middle of the range usually reflect employees who have mastered the basic intent of the job and are performing the duties of the job at a satisfactory level. Employee salaries placed near the maximum indicate long term or highly experienced employees who perform the duties of the job at a consistently high performance level."

Setting Salaries For New Or Revised Positions

The process for setting appropriate salaries for revised or newly created positions is as follows:

(1) A job evaluation questionnaire is completed by the employee (unless this is a new position) and supervisor, either by pencil and paper or in an interview format. Any differing interpretations of questions and job content should be resolved at this step.

(2) The questionnaire data is entered into the WyCOMP program database and the data entry is verified.

(3) The responses are reviewed using WyCOMP by the staff person responsible for professional salary administration. The responses are reviewed for internal consistency and are compared to similar jobs in the professional unit, helping to maintain equity with comparable jobs. The result of this step is a point value and resulting salary grade for the position along with a completed job description.

(4) The point value generated by the job evaluation process places the position in one of several (currently eight) salary grades. The recommended salary within the grade for the job is determined at the campus according to the administrative guidelines using criteria such as the employee's qualifications and experience, the responsibilities of the position relative to other positions within the same grade, employee performance level, external market factors, and internal (inter and intra-campus) equity. The recommended salary is determined through consultation between the hiring department, the employee, the campus designee (probably Human Resources staff), and equal opportunity. A complete copy of these procedures is included in Appendix 9 of the Joint Salary Study Committee report.

These are essentially identical steps for either a new position or an existing position. Note, however, that in the case of a change in duties or responsibilities, the salary will remain at the same level unless the new point value places the job in a different salary grade. If a grade change occurs, the salary will be adjusted in proportion to the change in the position.

Setting Salaries For Existing Positions

This proposed salary system should ensure that salaries for new or revised positions are set fairly and appropriately. Salaries of existing employees, however, need attention to be consistent with the new system.

The procedures for setting initial salaries for current employees and the timeline for implementing any salary changes must be the subject of collective bargaining. The Joint Salary Study Committee Report lists a number of alternatives representing a range of costs and philosophical viewpoints for placing current employees within salary ranges.

Those alternatives span a continuum ranging from: (1) applying the salary system to new employees and transfers only, with no salary adjustments for current employees (no salary implementation costs for current employees), (2) assuring that each unit member is brought at least to the minimum of the appropriate salary grade for their job, with no salary adjustments for employees making more than the minimum (estimated cost: $2.2 million), (3) bringing all unit member salaries to the maximum of their appropriate grade (estimated cost: $15 million), (4) bringing all unit member salaries currently under the midpoint up to the midpoint of their grade (estimated cost: $7.9 million), and (5) placing unit member salaries within the appropriate salary grade using some formula based on length of service (estimated cost $4.1 to $7.6 million). Some of these alternatives are extremes, of course, but they illustrate the range of potential costs of addressing salary inequities.

The constant in all of these alternatives is that no employee will see his or her salary decreased as a result of implementation. Since any salary adjustments for current employees are subject to collective bargaining, the Committee does not recommend any specific alternative. These and other alternatives could be considered in collective bargaining.

IMPLEMENTATION:

(Pages 21-22 of Final Report)

After feedback from unit members and administrators, the Committee will review, and as appropriate, modify or annotate the report and forward it to the bargaining teams. A number of issues related to implementation of the system must be settled by collective bargaining between UMS and UMPSA, since any changes to existing unit member salaries and/or working conditions must be negotiated. These issues could include the procedures used to determine potential salary adjustments for current employees, timelines for implementation, and some specific elements of the administrative guidelines.

Implementation of the salary system begins with education and informational sessions for employees, supervisors, and administrators. It also includes market survey data updates, software deployment, staff training, and support materials. Perhaps the largest task in this part of the implementation is the collection of current job information and evaluation of all existing bargaining unit positions. A questionnaire must be completed for all existing positions, and each position must be evaluated (steps 1-3 above). The one-time costs for this part of the implementation are estimated at $122,690.

PROGRAM REVIEW:

(Pages 13-14 of Final Report)

The Committee recommends that the University and UMPSA establish a joint committee to periodically review the salary program. This joint committee should meet at least annually. Salary range competitive positioning should be done every 2-3 years and the entire program should be reviewed every five to ten years, or as significant changes in work design or significant changes in the University pay philosophy occur.

BENEFITS:

Adoption of this job evaluation system would have a number of potential benefits for employees, supervisors, administrators, human resources staff, and equal opportunity office staff, including:

NEXT STEPS:

(or Where Do We Go From Here?)

We strongly encourage all interested persons to read the full report, which is available in all UMS libraries, upon request from the campus Human Resources offices or the System Office of Human Resources, and on the WEB page at http://www.eece.maine.edu/salary. The full report is also available on the CAPS "gopher" facility. Select the menu for University of Maine System and campus information and then University of Maine System -- Human Resources. This report will be subject to review for two months after issue.

Readers should submit feedback, concerns, or questions to any current committee representative listed in Appendix 1 of the report. Comments will be reviewed by the committee and the report, as modified or annotated, will be forwarded to the bargaining teams for consideration in the current round of negotiations.