Chapter 4: Compensation
The objective of the campus compensation program is to establish and maintain salary rates that help you recruit, retain, and motivate highly qualified employees. The Staffing and Compensation Unit in the Office of Human Resources oversees the pay programs for all staff employees covered by Personnel Policies for Staff Members (PPSM), Management and Senior Professional (MSP) employees through grade V, and the various collective bargaining units.
Policies, procedures, and practices differ among the programs in terms of flexibility to manage salary actions, hiring, promotions, and merit increases. Your Staffing and Compensation Analyst is available to consult with you on pay issues and to interpret pay policy and procedures.
- Guiding Principles
- Administrative Stipends/Temporary Reclassifications
- Equity Increases
- Merit Increases
- Open-Range or Merit-Based Pay
- Promotional and Reclassification Increases
- Range Adjustments and Structure Adjustments
- Salary Placement Guidelines
- Salary Ranges
- Additional Resources
Management goals with relationship to the compensation program include:
- Making salary decisions that are based upon appropriate equity and budget considerations
- Encouraging and rewarding excellent performance with merit increases whenever possible
- Providing salary increases within available funding
- Motivating employees by demonstrating the link between performance and pay
Administrative Stipends/Temporary Reclassifications
Under PPSM, stipends may be granted to recognize temporary performance of higher-level duties or "other significant duties" not part of the employee's regular position. For employees represented by a collective bargaining contract, consult with the contract to determine stipend/temporary reclassification constraints.
Salary increases, outside of the annual merit process, occur as the result of promotion, upward reclassification or approval of a salary equity increase. To initiate a salary equity review for an employee, your request should be submitted through your department’s internal human resources authorization process. Requests for salary equity review are submitted to the Human Resources Department where your Staffing and Compensation Analyst conducts a comparative analysis of relevant factors.
The process of comparative analysis conducted by the Staffing and Compensation Analyst begins with an examination of rationale provided by the you. Rationale which are considered appropriate include:
- Provision of a more appropriate relationship between the salaries of employees performing work at the same level with similar levels of experience, background and performance.
- Provision a more appropriate relationship between the salaries of existing employees and salaries offered by competitors in a compelling labor market.
- Recognize significant growth in a job that impacts scope and complexity but does not elevate the job to a higher classification level.
- Respond to the need to retain an employee with unique and specialized skills in the face of a documented competitive salary offer for a similar position.
Upon a lateral change in position, typically there will be no change in the employee's salary. In exceptional cases, an employee may be considered for an equity increase. Requests for salary equity increases upon lateral transfer should follow the same process as described above.
Salary increases are granted to eligible employees in career positions based upon their job performance. Merit eligibility varies depending upon the appropriate staff policy or collective bargaining agreement but is typically restricted to career, non-probationary employees. The amount of the increase depends upon the individual's performance in relation to current pay and assigned responsibilities as well as performance relative to other members of the review unit, and availability of funds.
The Manager, Compensation and Client Support Services in Human Resources manages the campus merit programs. Key elements of the staff merit process typically involve:
- The Manager, Compensation and Client Support Services sends a notice letter to the affected campus control units and administrators announcing the merit program and outlining the merit increase guidelines and salary increase control figures as determined by the campus within parameters set by the Office of the President. (Control figures represent the fund pool available for merit increases.)
- Merit programs typically include a feature by which higher merit increases are provided for employees who perform above expectation in achieving goals and objectives however, no individual merit increase may result in the employee's final salary exceeding the range maximum and no individual's salary should fall below the range minimum.
Open-Range or Merit-Based Pay
Salary structures for open-range or merit-based pay plans are reviewed annually and adjusted when funding is available and/or when warranted by market conditions. Automatic increases are not necessarily provided when structures are adjusted. Individuals salary increases are subject to the appropriate salary merit plan.
Promotional and Reclassification Increases
For positions under PPSM and MSP, hiring departments are authorized to grant promotional and reclassification increases up to 15% of the employee's current salary. Requests to provide salary increases upon promotion or upward reclassification that exceed 15% should be submitted to your Staffing and Compensation Analyst along with rationale that would support the request.
For exclusively represented employees in units with collective bargaining contracts, consult the contract for the specific authority to grant promotional increases.
Range Adjustments and Structure Adjustments
Salary range adjustments for step-based salary ranges are subject to terms and conditions negotiated through the collective bargaining process. Recommendations for salary range adjustments are typically based on:
- Assessment of competitive market pay practices
- Campus recruiting and retention problems
- Internal comparisons
- Amount of available funding
Salary Placement Guidelines
The guidelines provided in this section are framed by PPSM and represent prevailing campus practice. Where salary setting is specifically addressed in collective bargaining agreements, the stipulations of those bargaining agreements should guide salary-setting decisions.
An employee's salary must be set within the defined salary range for their defined title.
The following are general guidelines for salary setting:
A UC employee who is promoted to a step-based position with a higher salary
range maximum may receive a salary increase to the minimum of the new salary
range or the equivalent of a one-step increase, whichever is greater, provided
that the resultant salary does not exceed the maximum of the new salary range.
A UC employee who is promoted to a position with a merit-based salary range
may receive a salary increase of up to 15%, provided that the resultant salary
does not exceed the maximum of the new salary range.
A UC employee who transfers laterally into a position with an equivalent
salary range typically does not receive a change in salary. Exceptions are to be
discussed on an individual basis with your Staffing and
A UC employee who demotes into a position with a lower salary range maximum
may or may not receive a decrease in pay to result in a salary that must fall
within the new salary range. Any increase in an employee's salary upon demotion
requires approval from your Staffing and Compensation Analyst.
Exceptions falling outside of the above salary setting parameters will
require approval from your Staffing and Compensation Analyst. If you have
any salary setting questions please contact your Staffing and
Salary setting for new employees is framed by more general guidelines. You
may consult with your Staffing and Compensation Analyst on available
information regarding internal and external compensation trends for the
classification. Along with this data, the following issues should be
Market factors, recruitment difficulty and salary history
Utilize whatever appropriate market data is available to assess what you can reasonably expect to pay in order to remain competitive with the existing labor market. Market data such as salary surveys and current pay practices of local universities, hospitals or other similar organizations should be taken into consideration.
Consideration should be given to recruitment difficulties with relationship to the available trained labor force for the position. Individuals who possess skills that are scarce in the labor force may be in higher demand and require additional salary consideration. Evaluation of factors such as the scarcity of qualified applicants, the number of rejected job offers, and the turnover rate for a position may give insight into existing recruitment difficulties.
An applicant's salary history in positions related to your opening should be taken into consideration. Attention should be given to the relationship of your position to the candidate's previous positions in terms of responsibilities and required skills.
Consideration should be given to the number of years that a candidate has performed similar work and where an individual with that experience might reasonably expect to fall within the salary range for the classification.
Similar consideration should be given to a candidate's educational background as it relates to an open position. Related education, beyond what is required for a position, may be used as you would use additional years of experience in evaluating where to set a candidate's salary within a range.
Relationship to Internal Peers
Salary equity among internal employees is an important consideration when setting starting salaries. Perceived inequity not only impacts employee morale and motivation but also may trigger contentions of discrimination or grievances. When setting starting salaries, the skills and background of external candidates should be compared to those of internal employees performing similar work, and this comparison should factor into the salary decision.
Salary equity does not imply that all employees within a classification who have similar years of experience and education should be paid the same salary. It is assumed that recognition of varying levels of skills and performance, for example, will result in differences in salary among employees.
Do pay practices already exist on campus for employees performing similar duties?
Is your selected candidate relocating from an area where his/her salary history may not reflect the economic standards of the Bay Area?
Are there unique circumstances to be considered?
Your Staffing and Compensation Analyst is available to assist you in evaluating individual salary decisions.
The two most common salary structures for staff positions are positions with steps (step-based) and positions without steps (open ranges). You can determine which structure a particular position employs by checking the appropriate bargaining agreement or policy that covers the position, or by looking the title up in the Campus Title and Pay Plan .
Positions with Steps
Step-based salary ranges are predominant among positions covered by collective bargaining agreements as well as Police Sergeants covered by PPSM. The following guidelines apply to step-based ranges:
- The salary of an employee must be placed on one of the pre-defined steps.
- With a range adjustment, each step is increased by a specific percentage and each employee on a step automatically receives the new rate for that step.
Positions Without Steps
Open salary ranges are predominant among positions that fall under PPSM and MSP policies although some positions covered under collective bargaining agreements have open salary ranges. The following guidelines apply to open ranges:
- A grade level is assigned for each open range title in MSP & PSS.
- Salaries of individuals in MSP titles that carry mulitiple grades must fall within the range for the grade assigned to their individual position.
- Each grade range is defined by a minimum, midpoint, and maximum rate.
- An individual's salary may placed at any pay amount within the open range.