The Office of Compensation is responsible for guiding managers in determining appropriate salary for new hires and current employees. You can download a full description of this office's services. Pay decisions are made in collaboration with the manager, department/divisional leadership and human resources manager (if applicable). They are based on an employee's experience, education/special skills, and performance, as well as the employee's pay history, pay equity, and approved salary budgets.
Learn more about:
- Compensation Basics
- Job Classification
- Equity Analysis
- Compensation Regulations
- Understanding Our Role and Contribution Based Classification System
- How Market Based Salaries Are Established
- Pay Policies and Practices
Many factors go into making fair and equitable pay decisions. Click here for a slide-based overview of compensation basics that covers what managers need to know and do when making pay decisions. You may also want to download a glossary of key terms used in managing compensation at the university.
Before the classification and pay for a specific job can be determined, you need to provide an accurate description of the job's duties, responsibilities and requirements. Here are some tips for writing a job description.
It's the responsibility of the manager/supervisor to submit and discuss the job description with the Compensation Office. The job is then classified by assigning it a role, level and salary range. The Classification Criteria Matrix illustrates the system the university uses when classifying a job. Click here for examples.
The university uses survey data to determine competitive pay levels for specific jobs in a defined labor market and to assess the competitiveness of our pay ranges relative to other organizations competing for the same talent. This process is commonly called, "Benchmarking," and it includes:
- Salary Surveys—The Compensation Office participates in and/or purchases over 20 compensation surveys each year to gather data from the labor market. These surveys provide market information for a representative sample of jobs at the university. Click here to view a list of surveys in which the Compensation Office participates and/or purchases.
- Job Matching—The university's actual job descriptions are matched to job descriptions provided in the salary surveys. To be considered a proper match, at least 70% of the job content must be similar in scope and responsibilities. The Office of Compensation consults with managers, as needed, to ensure that market matches are made appropriately.
Survey Scopes—Because market rates may vary widely, the Compensation Office selects the market data that best reflect the competitive market for a specific job based on:
- Geographic location (e.g. national, regional, local)
- Industry (e.g. Non-Profit, Education, Health care, etc.)
- Organization size (e.g. revenue, # of employees)
The Compensation Office develops Market Reference Reports for hiring managers to ensure that compensation at the university is internally equitable and externally competitive. These reports include survey reported compensation data and the university's pay in comparison to the market. It contains job classification and market pay information for each employee in a division/department/unit. The report is intended to serve as a tool to help managers with compensation planning, such as monitoring and maintaining internal equity, assessing potential pay growth opportunities and determining new hire pay. It enables managers to make equitable and competitive pay decisions and recruit and retain talented individuals by paying them competitively.
Compensation Laws & Regulations
There are a number of laws that govern how pay is determined and delivered. As a manager, you should become familiar with these important regulations.
|Fair Labor Standards Act (FLSA)||Deals with minimum wage, overtime pay and exemptions, equal pay, child labor, hours of work and recordkeeping for employees (see additional information below).||Department of Labor (DOL)|
|Equal Pay Act (EPA)||Prohibits unequal pay for equal or substantially equal work performed by men and women.||Equal Employment Opportunity Commission (EEOC)|
|Title VII of the Civil Rights Act (Equal Employment Opportunity Act)||Prohibits discrimination based on race, color, religion, sex (including pregnancy) or national origin.||Equal Employment Opportunity Commission (EEOC)|
|Age Discrimination in Employment Act (ADEA)||Prohibits job discrimination in hiring, firing or conditions of employment against individuals age 40 or older||Equal Employment Opportunity Commission (EEOC)|
|Americans with Disabilities Act (ADA)||Prohibits discrimination against individuals with disabilities in employment, public services, public accommodations and telecommunications||Equal Employment Opportunity Commission (EEOC)|
|Sherman Antitrust Act (Competition Law)||Prohibits the exchange of detailed compensation information, unless safe harbor guidelines are followed, thereby avoiding anti-competitive "price fixing"||U.S. Department of Justice; Federal Trade Commission|
|Executive Order 11246 (Federal Contractors)||Prohibits federal contractors and subcontractors that generally have contracts that exceed $10,000 from discriminating in employment and compensation decisions on the basis of race, color, religion, sex, or national origin.||Office of Federal Contract Compliance Programs (OFCCP)|
|IRS 20 Factor Test for Independent Contractor||IRS uses factors to determine whether workers are employees or independent contractors||Internal Revenue Service (IRS)|
|State Labor Laws||Most states have laws governing employment and compensation, providing employee protection greater than federal laws.|
Fair Labor Standards Act (FLSA)
The Fair Labor Standards Act (FLSA) defines the criteria for determining when employees may be considered as exempt or non-exempt from overtime pay, minimum wage, and time record keeping requirements. An exempt employee is one who is exempt from the minimum wage and overtime pay regulations of the FLSA, whereas a non-exempt employee must be paid for all hours worked and at time and a half of their regular hourly rate for hours worked in excess of 40 hours in a work week. Non-exempt employees must also be paid no less than the established Federal or state minimum wage. Employers are required to maintain accurate records of actual hours worked for non-exempt employees.
The FLSA is governed by the Department of Labor. University job titles and salary ranges do not determine exempt status. An employee's specific job duties and salary must meet all of the requirements of FLSA regulations. In the university's job classification system, non-exempt employees are classified in levels 1, 2 or 3 while exempt employees are classified in levels 3, 4, 5 or 6. University employees classified in level 3 may be exempt or non-exempt from the FLSA.
Read more details about FLSA.
Understanding Our Role and Contribution Based Classification System
The university uses a role and contribution based classification system that assigns each job a role, level, and market-based salary range. Compensation analysts classify a job based on a number of factors, including the job duties, difficulty, level of responsibility, and other comparable positions.
How Market Based Salaries Are Established
Market data is very important in helping the university determine what to pay for an individual job. We participate in many compensation studies to obtain information about what comparable organizations are paying for similar jobs. The compensation office uses this information to build the university’s salary ranges and develop pay guidelines.
For more information about roles and levels, read the job classification guide.
Pay Policies and Practices
The compensation program is designed to reward staff members for developing skills and competencies in their current jobs. It also supports career development by giving a staff member the opportunity to move into a different job within a career path.
Pay policies, in general, govern the following:
- New hire pay
- Salary and career growth opportunities, including developmental increases and promotions
- In-range salary increases
- Annual merit increases
- Equity and market-based adjustments
- Special pay, including:
- Changes to the salary structure
For more details about the university's pay policies and practices, refer to: