Staff Personnel Manual (SPP)

Effective: 7/1/1984

Revised: 4/1/2011

SPP 403–08: Salary Administration

Purpose

To define the categories of salary adjustment administered in connection with position changes, contribution, retention, and university sponsored salary programs

Sources

Arizona Board of Regents Policy Manual - 6–901

Applicability

Classified, service professional, and administrative employees

Policy

The university provides and maintains a salary administration adjustment process for determining individual salaries.

All salary adjustments will be communicated to affected employees in writing, identifying the employee’s present salary, salary adjustment amount, new salary, and effective date of the adjustment. This notification will be under the signature or electronic approval of the employee’s supervisor or higher authority. Departments should also maintain a copy for their records. University-wide salary adjustment programs will follow this same procedure; however, signature authority is the university’s Chief Human Resources Officer (OHR).

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Salary Offer Principles

• Salary offers to the selected candidate should be consistent with the salary range as advertised in the recruitment notice.
• If no range is posted in the recruitment notice, the offer should be consistent with the assigned salary range of the job classification.
• The hiring department should take into consideration the candidate’s prior relevant experience when determining a salary to offer (see “Manager’s Guide, Compensation and Salary Administration”).
• Consistent with a compensation philosophy that recognizes the outstanding performance of exemplary staff, a department may request an additional skill/competency adjustment to recognize a candidate who exceeds expectations after six months in the new position, depending on availability of funding.

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Salary Administration Terms

Promotion

Definition

Promotion is the action of advancing or elevating an employee to a higher grade or position and includes an increase in pay.

1. Competitive (Associated with a Recruitment)
   1. A pay adjustment should be consistent with the posted salary range of the recruitment notice.
   2. The hiring department should take into consideration the candidate’s prior relevant experience when determining a salary offer (see “Manager’s Guide, Compensation and Salary Administration”).

2. Noncompetitive
   1. A noncompetitive promotion includes an adjustment in salary consistent with the relative change in the scope of job responsibilities, grade change, performance level, and relation of salary to the established range reference points (see “Manager’s Guide, Compensation and Salary Administration”).

Lateral Transfer

Definition

A lateral transfer results when an employee moves from one job to another job without a change in salary grade or job classification.

A pay increase may be administered if the job change is related to a competitive recruitment where the scope (duties and responsibilities) of the job classification is significantly greater than the prior classification.

Pay Reduction

Definition

A pay reduction may occur when an employee changes from one job classification to another that has a lower grade.

1. Department administration should consult with the Office of Human Resources (OHR) to determine if a pay reduction is appropriate (see SPP 809, “Discipline”), based on circumstances.
2. If an employee, during a competitive recruitment, is selected as the preferred candidate and that change results in a position in a lower grade, the candidate’s salary offer is consistent with the recruitment notification of the salary range and is considered a career change, not a demotion.

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Types of Salary Adjustments

Performance Increases

A performance increase may be awarded to an employee based on an assessment of work performance. Performance increases may be provided only when appropriated by the legislature or the university and authorized by the university.

Performance increases usually occur at the start of a fiscal year or as otherwise determined by the university president or as designated by the legislature.

A classified employee may be eligible for a performance increase not to exceed the maximum of the assigned pay range. Performance-based increases for service professional staff should not exceed the maximum of the assigned market grade. A vice president’s or dean’s support for an increase to exceed the maximum of the grade for service professional must be included when requesting final approval.

Performance increases are based on the performance period specified by the university. An employee whose performance evaluation is level 1 (fails to meet the performance expectations) or level 2 (inconsistently fulfills performance expectations) is not eligible for a performance increase. Recognition of an employee’s performance contribution through an increase should be aligned with the guidelines developed by the university at that time to ensure that the strongest performing employees receive an increase appropriate to their value.

Performance increases may be granted only when the university authorizes a salary increase budget and with the approval of the respective leader (the university president, provost, vice president, associate vice president, or dean).

Skill/Competency Based Increase

Skill/competency based salary adjustment may be administered in connection with a reclassification of a position resulting in a change in assigned grade or to recognize an employee’s demonstrated ability to take on more complex or additional assignments or expanded knowledge or skills.

Salary adjustments in recognition of demonstrated capabilities, skills, and/or competencies may vary, taking into consideration other employees within the same position and/or department consistent with a pay for performance strategy. The Compensation department of OHR is available to assist. Recommendations for skill/competency adjustments require prior approval as appropriate and should not be communicated to the employee until receipt of approval.

Equity Adjustments

Colleges, departments, and work units are responsible for establishing and maintaining equitable pay relationships within their work units. When a pay inequity problem is discovered, an internal equity adjustment may be recommended. An internal equity adjustment is a salary increase that is intended to correct a pay disparity within a job classification. Factors that may be considered in determining equitable pay relationships are employee credentials and experience, salary history at the university, and documented employee work performance. Administrators/direct supervisors should work directly with OHR to determine an appropriate internal equity adjustment when a pay disparity exists.

Recommendations from OHR must be approved by leaders prior to implementation.

Market Adjustments

A market adjustment is initiated as the result of a compensation study. Market adjustments occur when the assigned grade of the job classification is adjusted to a grade higher and the affected incumbent’s current salary falls below the minimum of the new grade. If additional in-range correction is warranted based on an assessment of the employee’s salary compared to the job’s market rate, taking into consideration performance and experience, administrative officials and OHR should work together in partnership to determine appropriate in-range adjustments.

A vice president/provost or designee must approve market adjustments that result in the employee’s new salary exceeding the 75th percentile of the job’s salary grade.

Market adjustments or job reclassifications resulting in upward grade movement with associated financial impacts must be reviewed and finalized by OHR. Once finalized, the recommendations from OHR must then be approved by leaders prior to implementation.

Retention

Retention adjustments may be determined appropriate to retain critical, key talent and/or highly recruited staff. Individual retention adjustments may vary based on the circumstances. Requests for a retention adjustment should provide supporting documentation when presented to the vice president or dean for review and support with final approval reserved to the executive vice president and provost of the university, the executive vice president, treasurer and CFO, or designee.

Additional Information

For information on salary administration references and guidelines, please see “Manager’s Guide, Compensation and Salary Administration.”

Cross-Reference

For more information on salary increases, see SPP 402–05, “Promotion (Competitive or Noncompetitive).”

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