Salary Adjustments

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Policy Number:
UW-5023
Old Policy Number:
10.01
Responsible Office:
Office of Human Resources

University Policy

Rationale/​Purpose:

It is critical that UW–Madison develop and implement a “total compensation” (pay and benefits) approach that is fair, equitable, and competitive with other employers; and also rewards performance. The components of this approach include developing a compensation structure that balances internal equity and market competitiveness, accommodates cost-of-living adjustments, and provides mechanisms to reward performance for all faculty, academic staff, university staff, and limited appointees.

In line with Regent Policy Document 6-3, the UW System Board of Regents has delegated authority to the UW System President to approve personnel transactions for positions in which the salary does not exceed 75 percent of the System President's salary. On June 27, 2000, the System President extended this same delegated authority to the Chancellors.

Wis. Stat. § 36.09(1)(e) sets forth the basic statutory authority of the Regents to set salaries.

Wis. Stat. § 36.115(3) requires that the chancellor shall develop a personnel system that is separate and distinct from the personnel system under Chapter 230 for all system employees assigned to the University of Wisconsin–Madison.

Wis. Stat. § 36.09 authorizes the Board of Regents to grant salary increases (other than the annual pay plan) only for four reasons: job reclassification (change in duties), promotion, salary inequity, or competitive (market) factors.

 

Definitions:
Base-building adjustment
A temporary or permanent salary increase. 
Bonus (Lump-Sum) Payment 
A one-time payment to an employee that increases total cash compensation, but not base salary or regular pay rate. 
Demotion
The movement of an employee into a job that is assigned to a lower salary grade than the employees current job. 
Equity
The quality of being fair or impartial. Within compensation, this is the practice of ensuring employees are being paid fairly without regard for race, color, gender, religion, sex, national origin, age, and/or disability for similar work performed. Please see the Equal Pay Act for more information.
Exigent circumstances
Any significant campus-wide event or occurrence that creates a need for the university to drastically reduce financial expenditures for personnel including, but not limited to, a decline in the university's financial resources, substantial decline in enrollment, funding reduction, temporary or permanent closure of campus operations, or unanticipated major expense or capital need. 
Lateral
The movement of an employee into a job that is assigned to the same salary grade as the employee's current job. 
Market
Employers that UW–Madison used for job salary comparisons (may be local, regional, national, or international depending on the job). 
Parity
The practice of ensuring appropriate salary relationships are maintained for employees within the same job title or related job titles as imbalances or issues may arise with new hires and differences in pay practices across work units. 
Promotion
The movement of an employee into a job that is assigned to a higher salary grade than the employee's current job due to the acceptance of a higher set of job responsibilities. 
Supervisor
An employee who has the authority, in the interest of the employer, to hire, transfer, suspend, promote, discharge, assign, reward, conduct performance evaluations for, discipline, adjust their grievances, or effectively recommend such action for at least 2.0 full-time equivalent (FTE) employees. Supervisors typically also assign and review the work of their immediate subordinates and may approve hours worked.  
Scope:

Faculty, academic staff, limited appointees, and university staff.

Policy:

 

Policy Summary

The policy describes methods to provide temporary, permanent and lump-sum salary adjustments to UW-Madison staff. Such adjustments allow the campus to address market and equity concerns, recognize changes in position duties, and reward staff for performance. Refer to the Overload Policy for more information on when payments for additional work that is not part of the employee's normal job responsibilities may be appropriate.

Section A- Overview

The available salary adjustments for use outside of an annual pay plan (i.e., across-the-board increase or merit awards) are described below. The Office of Human Resources (OHR) must approve all salary adjustments outside the pay plan before they are awarded, unless they are delegated to a division. All base-building salary adjustments (permanent or temporary) are subject to the maximum of the pay range for that position. Some salary adjustments are available as a one-time lump sum payment (see “Type of Adjustment” below).   

For additional information see the Related UW-Madison Documents, Web pages, or other Resources below. 

Section B- Progression Adjustments

  1. Equity

    1. Type of adjustment – base-building.
    2. An equity adjustment may be provided to rectify a situation in which inequitable salary relationships exist in categories protected by state and federal law (race, color, gender, religion, sex, national origin, age, and/or disability).

  2. Parity

    1. Type of adjustment – base-building.
    2. A parity base-building adjustment may be used to correct an inequity (for individual employees or a group of similarly situated employees) identified through compensation analyses of staff with comparable training, experience, and responsibilities.

  3. Market 

    1. Type of adjustment – base-building.
    2. A market adjustment may be provided for retention or competitive factors. It is essential that the division provides evidence supporting the need for a market adjustment. OHR is required to annually report all market adjustments to the Board of Regents.
      1. Retention. This adjustment is a salary increase to retain one or more employees who outside offers (outside UW-Madison or UW System), or there is evidence of a serious retention problem. This can include a recent pattern of employees in the same discipline/unit leaving to take positions outside UW-Madison or UW System with comparable responsibilities at higher salaries. Units should use this type of adjustment only to retain employees with exemplary performance and highly-valued expertise.
      2. Competitive. This market adjustment is a salary increase to retain one or more employees when there is no outside offer or specific example of current retention problems, but there is evidence of a potential retention problem due to the market.

  4. Performance 

    1. Type of adjustment – base-building or lump-sum payment.
    2. An adjustment may be awarded for sustained performance that meets or exceeds established standards of a job.
    3. For base-building adjustment, performance criteria that meets or exceeds established standards of a job include:
      1. Length or frequency of the performance
      2. The regularity of the performance or unique contribution (e.g., an employee who routinely demonstrates exceptional performance and participates in special projects on an ongoing basis, compared to an employee who completes a one-time special project)
    4. To be eligible for a performance base-building or bonus (lump sum) increase: 
      1. An employee must have successfully passed their probation/evaluation period.
      2. Employees responsible for supervising staff must be up to date on performance evaluations to be eligible for this type of increase. See Performance Management for Managers and Supervisors for more information on performance evaluations.
      3. An employee must have a satisfactory performance evaluation on or after the previous fiscal year start date with no documented performance concerns.
      4. An employee must be in compliance with the UW-Madison Policy on Sexual Harassment and Sexual Violence Policy.
      5. An employee must have completed the required Cybersecurity Awareness training.
    5. Employees on probation or serving in an evaluation period are not eligible for a performance increase.

  5. Change in Unique Responsibilities (No Title Change)

    1. Type of adjustment – base-building.
    2. An adjustment may be requested when there are permanent changes to an employee’s responsibilities which are qualitative rather than quantitative (i.e., doing more of the same work).
    3. Such changes must be permanent job duties or responsibilities of growing importance to the operational unit that are either newly assigned or have evolved from the job’s original functions. The new responsibilities should be of greater scope, impact or complexity compared to the previous functions.
    4. The change in responsibilities does not lead to a change in the position’s title.

  6. Change in Responsibilities and Title - Promotion, Lateral or Demotion 

    1. Type of adjustment – base-building.
    2. A change in responsibilities and title may be requested when a filled position has changes in responsibilities due to organizational business needs and a different standard job description is more appropriate. This may result in a promotion, lateral move, or demotion.
    3. Such changes must be permanent job responsibilities of growing importance to the operational unit that are either newly assigned or have evolved from the job’s original functions. The new responsibilities should be of different scope, impact or complexity compared to the previous functions.
    4. This type of adjustment may not be available when the change in title involves moving from a non-managerial position to a managerial position (e.g., organizational contributor to manager).
    5. This type of adjustment may not be available for movement into a limited title from a non-limited title, unless the non-limited title is a faculty title.
    6. When an employee has a title change that results in a change in their status under the Fair Labor Standards Act, the employee will maintain their employment category.

  7. Temporary Change in Responsibilities

    1. Type of adjustment-based building (temporary for length of the adjustment and then removed).
    2. This adjustment can be requested when an employee who assumes additional temporary responsibilities within the current position and title. This may occur while the unit is recruiting for a permanent hire; due to an unanticipated assignment of an unusual, short-term or nonrecurring nature; or due to a temporary administrative assignment. The adjustments are only intended to last while the employee performs the additional responsibilities. The temporary responsibilities must be appropriate for the employee’s current title.
    3. This adjustment is used to match the rate in a limited position when a faculty member is appointed to a part-time limited position.
    4. This adjustment is not appropriate when the temporary change in responsibilities means a new title is more appropriate. In these cases a Temporary Acting Appointment is appropriate and the current job should be placed on a leave of absence

  8. Lump Sum Payments

    1. Type of adjustment – bonus (lump sum) payment.
    2. Typical reasons for these payments include successfully completing special assignments outside the scope of an employee’s normal job responsibilities, performance, and hiring bonus.

Section C- Other Adjustments

  1. Temporary Adjustment End 

    1. Type of adjustment-based-reduction.
    2. This adjustment is made at the end of the term of the Temporary Change in Responsibilities. 

  2. Living Wage Adjustment

    1. Type of adjustment – base-building.
    2. The university will match the City of Madison living-wage provisions for all staff in scope for this policy along with Temporary Employees. This standard requires a minimum wage higher than the federal minimum wage.

  3. Setting an External Rate

    1. Type of adjustment – base-building.
    2. A permanent adjustment used to match the prevailing wage as required by the United States Department of Labor. A rate change may be mandated when an employee has a change to their immigration status.

  4. Different Pay Basis

    1. Type of adjustment – base-building.
    2. A permanent adjustment used to convert an employee’s pay basis from one to another. This does not result in an increase or decrease to an employee’s rate of pay, rather a conversion based on the Salary Conversion Table.

  5. Temporary Voluntary Reduction

    1. Type of adjustment – base-reduction.
    2. In response to exigent circumstances and with the approval of OHR, employees may be offered the option to take a voluntary reduction in pay. The terms of the reduction in pay will be determined by OHR and the employee.

  6. Temporary Voluntary Reduction End

    1. Type of adjustment – base-building.
    2. This adjustment is awarded at the end of the term of the voluntary reduction in pay.
    3. The amount of the adjustment will be the amount of the Temporary Voluntary Reduction plus or minus any intervening adjustments.

Section D - Process

  1. Effective date of salary adjustments

    Salary adjustments will be effective the beginning of the pay period following the date OHR receives the request. OHR may delegate effective receipt to the division dean/director’s office. The Wisconsin Constitution (Art. IV, § 26) prohibits retroactive salary adjustments. In addition, Wis. Stat. § 109.03(1) prohibits making payments before work is performed. For processing of adjustments, the effective date cannot be effective earlier than the first day of the pay period following the receipt of the request to the dean/director’s office as indicated by the Department Approved status in the JEMS Rate/Title change system. 

  2. Multiple salary adjustments on same date (order of application)

    Multiple salary adjustments effective on the same date will be applied in the following order:

    1. Change in Responsibilities with Change in Title (Promotion, Lateral or Demotion)
    2. Change in Unique Responsibilities with no Change in Title (permanent or temporary)
    3. Equity 
    4. Parity
    5. Market 
    6. Performance
    7. Raise to college or campus minimum*
    8. Pay plan
    9. Pay upon appointment

    *Raise to campus minimum must be applied first for Faculty titles (FA040 and FA030) when a promotion is being applied and the employee’s salary is below the minimum for the title they are moving to.

Consequences for Non-Compliance

If a school, college or division fails to comply with the Salary Adjustments policy, OHR may remove delegation for the approval of salary adjustments. Employees who receive salary adjustments that are not in compliance with this policy, Board of Regent policy, and/or Wisconsin State Statutes will have the adjustments removed from their base pay. These employees may be required to return payments made in error.

Responsibilities

Office of Human Resources (OHR)
  • Provides policy oversight to ensure compliance with campus policy
  • Conducts periodic reviews of the policy with campus human resources departments
  • Implements any needed changes to the policy
  • Manages the process to review and approve pay adjustments and enter them into the employee’s record
  • Works with divisions to delegate some base adjustments
College/School/Division HR
  • Ensures that all salary adjustments are made in accordance with this policy
  • Ensures administrators, supervisors, and hiring managers are aware of, and comply with, the pay adjustments policy
  • Serves as the records custodian for all pay adjustments in their employing unit
  • Defines consistent compensation guidelines for pay adjustments
  • Manages the salary adjustment process so that adjustments are awarded equitably
  • Consults with International Faculty and Staff Services before making any changes to an international employee’s compensation



Related UW-Madison Policies:
Related UW–Madison Documents, Web Pages, or Other Resources:
External References:

Policy Administration

Approval Authority:
Vice Chancellor for Finance and Administration
Policy Manager:
Interim-Chief Human Resources Officer
Contact:
Director, Compensation Administration -- Meghan Owens, meghan.owens@wisc.edu, (608) 262-2346
Effective Date:
06-26-2015
Revised Dates:

05-13-2020, 11-07-2021

Retrieved:
09-25-2022 11:36:10