WV Higher Ed Policy Commission New Classification System

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1 WV Higher Ed Policy Commission New Classification System Presentation by Dr. Marie DeWalt, Tammy Gill, and Donna Shipley Human Resources Office July 2017

2 Problems with old classification and compensation system, created in early 90 s Lowest pay grades on old salary chart are below minimum wage. Shepherd has not had the funds to keep up-to-date with pay step funding despite creating 2008 institutional salary schedule. Each pay step correlates with years of service with any WV state agency regardless of relevance to current position. 2

3 Problems with old classification and compensation system (continued) Does not recognize prior related work experience from other employers. Does not incentivize high level of performance. Fails to align with how jobs are valued in the market. Has caused classification creep since upgrades were the only path to salary increases. 3

4 Legislative and policy changes related to personnel HEPC was authorized in 2011 to establish a new classified salary structure and pay grades and the staff has been working on this for the past few years. HEPC contracted with Mercer, a large HR consulting company. New system is market based, not seniority based. Pay will not be reduced due to new system. 4

5 More recent legislative and policy changes Limit on number of non-classified employees has been removed. Non-classified positions were redefined to include all IT Services jobs and, going forward, all positions that meet the duties test of the Fair Labor Standards Act. Institutions are permitted to incorporate merit pay into their classified staff salaries. Supervisors: Annual performance evaluations are more important than ever! 5

6 Benefits of Market Based Approach in New Compensation System Greater flexibility to use salary dollars to recruit best talent and pay for performance. Move away from pay step (years of service) salary increases. Fair pay based on job responsibilities and market rates. Will be able to consider all prior related job experience rather than only WV state agency job experience. 6

7 General Market Pay Philosophy Provide flexibility to manage base pay. Base comparisons on appropriate external labor markets while also considering relative internal worth. Administer compensation strategically, consistently, effectively, efficiently, fairly and equitably. Establish framework for career progression and recognition of high performance. 7

8 New HEPC Compensation Philosophy Achieve fair competitive compensation to attract and retain competent, qualified and diverse employees. Salary patterns can vary by credentials and performance of individuals occupying positions. Does not include pay steps, across-the-board, longevity, or cost-of-living requirements. Goal of transitioning to rewards model to compensate employees skill, effort and outcome contributions. 8

9 New Salary Schedule Prospective West Virginia Higher Education Classified Salary Schedule Pay Grade Minimum Midpoint Maximum 1 19,200 24,900 30, ,200 28,800 35, ,600 33,300 41, ,500 38,400 47, ,200 44,400 54, ,500 51,400 63, ,700 59,400 73, ,800 68,600 84, ,000 79,300 97, ,500 91, , , , , , , ,900 Please note that this chart is supposed to be updated periodically. 9

10 Minimum of Pay Range Market Median-Midpoint of Pay Range Maximum of Pay Range Managing Pay Within a Grade Tool A salary that falls within 10% above or below the market median is considered competitive for experienced staff members. Paying for the job (based on external market) OR 25th % 50th % 75th % Min 1st Quartile 2nd Quartile 3rd Quartile 4th Quartile Meets minimum qualifications Previous related experience Meets preferred qualifications Expert or has demonstrated capability to perform as expert based on prior experience in all job criteria Exhibits broad and deep Has little or no direct related prior Demonstrated ability to perform Demonstrated ability to perform knowledge of own area as well experience duties duties independently as related areas May be new to field or job Requires additional training to build knowledge and skills to handle full job responsibilities Entry level skills and experience May still be learning some aspects of job or developing expertise to handle them more independently and effectively May need additional training to perform duties independently Consistently exhibits many or most desired competencies to perform job successfully Intermediate skills and experience Experienced in the job and possesses required knowledge and skills Consistently exhibits core competencies to perform job successfully Seasoned professional / midcareer Senior-level job expertise Expert skills and experience Paying for Less experienced; learning the the job individual Lower performance level (based on performance Limited knowledge or skill level and skills) Source: West Virginia Higher Education Policy Commission; May 2017 Experienced Consistently effective performance level Has required knowledge, skills and expertise and handles job responsibilities capably Consistently exceeds performance requirements Demonstrated mastery of job skills and expertise May be a "hot job" with a competitive external market 10

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19 New State System HEPC has not yet determined the timeline. New pay grades have been tentatively assigned by Mercer to existing classified positions. New pay grades are based on job duties, not titles. (For example, HR Assistant I, II, and III all are in the same pay grade now.) 19

20 Job and title clean-up and fine-tuning will continue. Institutions have been using job titles inconsistently because of the inflexibility of the old system. Job families and job titles will not be changed. New job descriptions will be based on HEPC master classification specifications. 20

21 New software systems (JDExpert) will be implemented by HEPC. Each job description will be developed from the master class specs. We will develop an on-campus process for job description and salary reviews, which will include a compensation committee. More to come following the HEPC s August meeting at which it will consider the new classification system. 21

22 Salary Increases At its June 22 nd meeting, the Board of Governors voted to allocate $500,000 for salary equity increases to some faculty and staff. Classified staff increases will go to employees below the prospective minimum pay and to lower earning staff whose salaries are substantially below compared to national data. The funding for the gap will be phased in. 22

23 Generally, employees in the lowest pay grades with the least amount of service are more likely to get salary increases based on this plan in this first round of increases. Classified staff will get letters notifying them of their salary increase, if they are getting one, and their new pay grade. Those who are not getting a salary increase will get letters confirming their employment status. 23

24 We intend for the implementation of the new classification system to be transparent and fair. We are uncertain about the compensation system timeline. Public comments will be welcomed as rules are developed to implement the new classification system. As this process rolls out, please let us know of your ideas, concerns, and questions. 24