Administrative Policies and Procedures Manual - Policy 3500: Wage and Salary Administration
Date Originally Issued: 01-01-1997
Revised: 03-21-1997, 08-01-2006, 10-01-2007
Subject to Change Without Notice
Authorized by Regents' Policy 6.3 "Privileges and Benefits"
The University of New Mexico's compensation package consists of both salary and benefits. Benefits have a monetary value and both the University and employee should consider this value in reviewing compensation. This policy describes the administration of the University's wage and salary program. Benefits offered by the University are discussed in Sections 3600 and 3700 of this Manual. As a public institution, employee salaries are public information as described in "Personnel Information Disclosure Policy" 3710, UBP. This policy should be read within the context of "Guiding Principles" Policy 3000, UBP. It applies to all non-bargaining staff employees. Refer to the applicable collective bargaining agreement for compensation policies and procedures for employees covered by the bargaining unit.
2. Staff Salary Schedule
The Division of Human Resources (HR) assigns each staff job title to a specific pay grade that has an established minimum to maximum range of allowable salary rates. Staff employees will not be paid at a rate less than the minimum for their grade. Refer to the Staff Salary Schedules on HR's website for current pay ranges. HR will conduct periodic reviews to assess the accuracy and competitiveness of the Staff Salary Schedules and will make changes as indicated.
3. Starting Salary
When hiring a new employee or rehiring a former employee, the hiring officer and HR will determine the employee's starting salary prior to making a salary offer. The starting salary will be based on the grade of the position and the individual's qualifications, experience, and competencies, as well as budgetary considerations, subject to the following provisions.
3.1. Internal Equity
If an employee is being hired into a department that has one (1) or more employees in the same job title, the new employee's starting salary should generally not exceed the current salary of any employee in the department with the same job title who has comparable qualifications. The assessment of comparable qualifications includes: experience, competencies, documented job-related performance, and education. The assessment will be conducted by the hiring officer in consultation with HR. If a new employee's salary would create an inequity, the hiring officer must consult with his or her dean or director and HR to determine appropriate salary adjustments for existing employees. Equity increases must be approved by HR before the employee can be hired. Any other potential equity adjustments must be reviewed in advance by HR.
3.2. Establishing a Starting Salary
The minimum of the pay range is typically paid to employees who meet, but do not exceed, the minimum qualifications of the position. Employees may not be paid below the minimum of the pay range or the established minimum wage for the University, whichever is higher. Starting salaries above the minimum and up to the midpoint may be considered depending on such factors as:
- The extent to which the employee's level of education and years of experience exceed the minimum requirements for the position.
- Job market-related pressure on salary levels.
- Internal equity considerations.
- Internal budget constraints.
Starting salaries above the midpoint may be considered for individuals who have directly related unique competencies or directly related experience or education that is extensively beyond the minimum requirements of the position, as determined in consultation with HR, or in cases of unusually critical market-related pressure on salary levels. A written justification for all salaries above the midpoint must be submitted with the hire packet and be approved by HR.
4. Salary Changes
A staff employee's salary may be changed by any of the actions specified below.
4.1. Annual Increases
In July of each year, the University Board of Regents may allocate funds for salary increases. Each year that funds are available, increase guidelines including a salary budget percentage and lower and upper limits for increases will be provided to departments by HR. Increases may be distributed across the board to recognize all employees' contributions to the University's success or they may be distributed within a range of percentages that take into consideration individual merit based on a performance review, market, placement in range, or correction of internal inequities.
4.1.1. Increased Cost of Benefits
If the cost of mandatory or non-mandatory benefits increase, the funds necessary to meet these increases are allocated before other increases in compensation are considered. These increases may be due to increases in the University' s share of taxes and benefits, such as social security tax, retirement, health insurance, etc.
Based on the results of periodic reviews performed by HR the Staff Salary Schedules will be adjusted to reflect changes in the market place. Changes in the Staff Salary Schedules will typically not result in salary increases other than to bring all regular employee salaries up to the new minimum of the respective pay grades.
4.3. Change in Grade
4.3.1. Applied/Selected For a Position in a Higher, Lower, or the Same Grade
If a University employee applies for and is competitively selected for a position in a higher, lower, or the same grade in accordance with "Staff Recruitment and Hiring" Policy 3210, UBP, the employee's new salary is determined according to Section 3. herein. The employee's new salary is based on the employee's qualifications and the hiring officer uses the same salary criteria that would be used if he or she was hiring an applicant from outside the University.
If, in accordance with "Performance Management" Policy 3215, UBP, an employee voluntarily agrees to a demotion, the employee's salary may be decreased. A demoted employee's new salary is determined by his or her dean or director in consultation with HR.
An employee may be reclassified to a higher or lower pay grade if there are significant changes in a position's duties and responsibilities. A salary increase may be given if a job is upgraded. Movement of a position to a lower grade may result in a salary decrease. If the salary will decrease, it will not be effective until ninety (90) days after the employee has been notified in writing of the salary change.
4.3.4. Grade Change Because of Market Study
Periodically a market study of job families will be conducted. Jobs may be upgraded if data shows that they have fallen below the designated market. Increases will not be given for general market driven upgrades unless individual salaries fall below the new minimum for the pay range.
4.3.5. Grade Change Because of Career Ladder
A career ladder is a planned progression to a new job, usually at a higher grade, that is negotiated between an employee and his or her manager. The completion of the career ladder may result in a salary increase that must be authorized by HR.
4.4. Acting or Interim Appointments and Temporary In-range Adjustments
It is expected that an employee will occasionally perform duties above and below his or her grade or classification. If an employee is assigned to perform all of the key duties of a higher graded position over an extended period of time, the employee should be appointed to an acting or interim position in accordance with Section 3.8. "Staff Recruitment and Hiring" Policy 3210, UBP. An employee who has assumed some, but not all, of the duties of a higher graded position may be awarded a temporary in-range adjustment within the pay range for his or her current position for a period not exceeding six (6) months. The additional assignments must be a significant portion of the position and must be performed for an extended period of time. These increases must be authorized by HR.
A transfer is defined as a non-competitive lateral move from one (1) job to another, or one (1) geographical location to another, in the same or similar classification within the same job grade. A transfer does not involve a salary change.
5. Pay Rate for Shift Work
A shift differential is an hourly pay rate, paid in addition to a nonexempt employee's base pay rate to employees who work at least half their hours on either a second or third shift. Employees are paid a second shift differential if at least half their hours are worked between 4:30 P.M. and midnight and a third shift differential if at least half their hours are worked between midnight and 8:00 A.M. Shift differential rates apply to the entire work period and not just the hours between 4:30 P.M. and 8:00 A.M. and will be paid at the highest applicable shift rate. Overtime is calculated at the employee's regular rate of pay (base pay plus shift differential). For additional information on overtime, refer to "Overtime" Policy 3305, UBP. Shift differential rates are established by HR and are listed on their website. Exempt employees are not paid a shift differential.
6. Standby Pay
At times employees may be required to make themselves available to work on an as needed basis outside of their normal work hours. Compensation for standby status will be determined by the degree to which an employee's free time is restricted. The specific factors considered to determine if standby status is compensated are:
- restrictions on the employee's location,
- expected response time to return to work,
- number of other employees available to be called, and
- frequency and urgency of calls received.
If employees have to leave a phone number or carry a pager but are free to leave the premises and attend to personal matters without restriction, they are not eligible for standby pay. Employees will be paid standby pay if while waiting to return to work they are so restricted that they cannot pursue personal activities. Standby pay rates will be determined by the Division of Human Resources. If employees are called back to work while on standby, they will be paid at their regular rate of pay for the hours actually worked or at time and a half for any overtime that is worked. Exempt employees are not eligible for standby pay.
7. Extra Compensation
Under the Fair Labor Standards Act, exempt employees are not paid on the basis of the number of hours worked. Exempt employment is a professional relationship whereby employees are given the flexibility to exercise professional judgment both in how and when the work is done. They are expected to meet operational needs and are evaluated on results achieved. Therefore, exempt employees do not normally receive extra compensation for work conducted beyond the normal forty (40) hours per week. However, exempt employees may in limited circumstances receive extra compensation from the University for work performed outside the employee's department. Non-exempt employees must be paid per Fair Labor Standards Act requirements, which normally means payment of overtime for hours worked beyond forty (40) in the workweek.
Extra compensation is not intended to compensate employees for cooperative work between University departments where staff provide support for each other on an ongoing basis. In all cases, the employee's primary assignment takes priority over the work performed for another unit.
7.1. Restrictions on the Authorized Use of Extra Compensation
Extra compensation may be authorized, subject to all of the following restrictions.
7.1.1. To qualify for extra compensation, the additional work must be performed outside the employee's department, with the employee's work being reviewed by someone other than the employee's regular supervisor.
7.1.2. The additional work (for which extra compensation is to be paid) may not, in the opinion of the employee's supervisor and dean or director:
- Create a time conflict with the performance of the employee's regular duties and assignments or
- Constitute a "conflict of interest" involving the employee, such as a situation that competes with the interests of the employee's primary assignment or the department's interests.
7.1.3. The additional work for which extra compensation is to be paid must be short term, non-repetitive, and is restricted in both the number or hours worked and the duration of the assignment.
7.2. Required Approval
Advance written approval is required by the employee's immediate supervisor and dean or director, the cognizant vice president, the dean or director responsible for the department where the work will be performed, and the individual who will be supervising the additional work. All requests for Extra Compensation must be approved by HR.
7.3. Pay Rate for Extra Compensation
When extra compensation is authorized, the rate of pay must be in accordance with the University's pay scale for the type of work being done and must be approved by HR .
8. Other Types of Compensation
For other types of payments to employees, refer to "Non Standard Payment Processing" Policy 2615, UBP.
9. Salaries Funded by Contracts and Grants
Staff employees whose salaries are funded by contracts or grants are subject to all the provisions of this policy and proposed salary levels and annual increases must comply with this policy.
Any exceptions to this policy must be approved, in writing, by the Vice President for Human Resources.
11. Related Links
Staff Salary Schedules located on HR's website.