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University of Houston-Downtown
Job Classification and Compensation Program
Documentation Manual August 2006
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Table of Contents

• Section 1
• Project Objectives and Worksteps 3
• Section 2
• Proposed Compensation Philosophy 8
• Section 3 Communications 11
• Section 4 Position Analysis 13
• Section 5 External Analysis - Market
  Pricing 15
• Section 6 Salary Grades and Ranges 20
• Section 7 Job Hierarchy and Target Pay Range
  Assignment 23
• Section 8 Impact of Salary Structure 25
• Section 9 Recommendations for Implementation
  and the Ongoing Maintenance of the
  Classification and Compensation Program 27

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Table of Contents Contd

• Appendix I
• Project Guidance Team 39
• Appendix II
• Compensation and Classification Program What it
  means to you 40
• Appendix III Position Description
  Questionnaire 49
• Appendix IV Market Survey Sources 51
• Appendix V Salary Structure Non-IT
  Positions 52
• Appendix VI Salary Structure IT Positions 53
• Appendix VII Job Evaluation Methodology 54

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SECTION 1PROJECT OBJECTIVES AND WORKSTEPS
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Section 1Project Objectives and Worksteps

• OBJECTIVES
• The University of Houston-Downtown (UHD)
  recognizes that a critical link in achieving
  sustained performance improvement, achieving best
  results, and selecting and retaining the best
  people can be accomplished with a focused and
  committed workforce who is motivated by a
  strategic, meaningful, rewarding and viable
  classification and compensation program. In an
  effort to achieve this link, the UHD
  classification and compensation program must
  address the pay equity for all positions
  internally and relative to the marketplace,
  maintain an objective job evaluation system and
  consistently apply standard procedure(s) for pay
  administration across all departments. UHD made
  a commitment in March 2006 to study its
  classification and compensation practices for all
  employees as they relate to both external
  competitiveness and internal equity. With
  assistance from Deloitte Consulting, a
  classification and compensation program was
  developed for all positions that embraces the
  following characteristics
• Establishes and reinforces an effective link
  between UHDs strategy, organizational demands,
  work expectations, individual needs and
  compensation
• Attracts, retains and motivates the best and the
  brightest employees
• Reflects UHDs unique organizational culture,
  mission, values and pay philosophy
• Provides an equitable and rewarding pay program
  for all employees
• Is in compliance with the Fair Labor Standards
  Act (FLSA), Americans with Disabilities Act
  (ADA), and related legislation
• Provides a consistent method of valuing jobs
  across departments within UHD
• Is easily communicated by the UHD leadership and
  is understood by all employees

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Section 1Project Objectives and Worksteps

• OBJECTIVES Contd
• Provides a foundation for future innovative human
  resource management approaches and strategies
• Maintains cost effectiveness
• Provides appropriate and competitive ranges of
  opportunity with respect to base pay for each
  position and
• Establishes consistency in policies and
  procedures for managing and administering
  compensation between departments.
• WORKSTEPS
• Based on discussions between Deloitte Consulting
  and the UHD leadership team regarding the
  characteristics listed above, a market-based
  whole job approach for all positions was
  recommended. This method of job evaluation
  allowed UHD to use competitive market information
  as a foundation for its pay program while
  measuring specific compensable job factors for
  objective internal pay comparisons. The
  following worksteps were used during this project
  to attain the stated and desired classification
  and compensation program characteristics
• Orient UHD leadership team including the
  President, his Executive Council and the
  Employment Service and Operations (ESO) team
• Confirm objectives, scope, process, methodology
  and work steps
• Collect background data

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Section 1Project Objectives and Worksteps

• WORKSTEPS Contd
• Develop and implement communication strategy
• Present general employee sessions to introduce
  the study and address questions, issues and
  concerns
• Conduct key stakeholders interviews
• Develop a written compensation philosophy
  statement
• Select salary survey sources from the Deloitte
  Consulting library
• Review and format employee database files
• Analyze positions, titles, and organizational
  structure
• Develop, administer, collect and organize
  Position Description Questionnaires (PDQ) for all
  the UHD positions
• Develop and administer separate form for
  supervisors (SPDQ) to provide feedback and
  comments on completed subordinate PDQ
• Read and analyze PDQs and supervisor feedback to
  determine benchmark sample
• Combine and edit job titles based on job
  requirements listed in PDQ and input from ESO
  team and UHD department heads

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Section 1Project Objectives and Worksteps

• WORKSTEPS Contd
• Develop job descriptions for each job at UHD
• Conduct competitive market analysis for benchmark
  jobs
• Develop recommended pay structure based on market
  data
• Conduct Job Value Matrix (JVM) approach to
  reconcile internal/external equity including
  slotting of non-benchmark jobs with the ESO
  team and UHD department heads
• Reconcile and review job slotting to ensure
  campus-wide equity for each job with further
  input from ESO team and UHD department heads
• Finalize job slotting and send each manager a
  list of their incumbents including new job title,
  proposed grade, minimum and midpoint of the
  grade
• Review comments from managers
• Generate cost impact report(s) of all employees
  with below minimum costs for each job
• Develop recommended salary administration
  policies and procedures
• Present results and recommendations to the
  President, Executive Council, Department Heads,
  and employees and
• Develop Documentation Manual.

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SECTION 2PROPOSED COMPENSATION PHILOSOPHY
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Section 2Proposed Compensation Philosophy

• The compensation philosophy of UHD supports the
  need for outstanding talent to provide the
  exemplary level of service, creativity,
  knowledge, business savvy, and leadership to
  fulfil its mission and setting a standard of
  excellence in virtually every facet of higher
  education.
• KEY OBJECTIVES
• Provide a total compensation program flexible
  enough to adjust to changing economic conditions
  and to individual needs
• Provide a competitive and affordable level of
  compensation for their highly qualified,
  motivated and diverse workforce in exchange for
  expected levels of performance and results
• Maintain fair, consistent and equitable total
  compensation practices in alignment with UHDs
  core values and mission
• Attract, retain, and motivate highly qualified
  and effective individuals
• Foster individual development, loyalty, and team
  work
• Encourage a career-long commitment to UHD
• Establish compensation program policies,
  procedures and guidelines that are consistent
  with the judicious expenditure of funds entrusted
  to UHD and
• Ensure accountability for compliance with
  University of Houston Systems Board of Regents
  rules and regulations and State of Texas
  statutory requirements.

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Section 2Proposed Compensation Philosophy

• PROGRAM PRINCIPLES
• Provide an equitable system of job evaluation and
  classification covering all non-faculty,
  non-police positions at UHD to properly reflect
  internal relationships
• Provide a pay program which is fully competitive
  in the market for all employees based on
  appropriate public and private sector employers
  with whom UHD competes for talent
• Provide a fair, non-discriminatory and compliant
  pay program with all federal and state laws and
  regulations
• Recognize the positive contributions of our
  dedicated employees who consistently provide the
  best value added performance and results for all
  that we serve
• Monitor and evaluate continuously all facets of
  the compensation program to ensure awareness and
  sensitivity to relevant market fluctuation(s)
  and/or movement
• Establish written policies, procedures, and
  guidelines for managing and administering pay in
  a consistent and equitable manner throughout UHD
• Communicate the total compensation program to all
  employees to ensure understanding of general
  administrations principles, specific pay policies
  and practices, and the process used to determine
  job classification and individual pay
• Provide appropriate ranges in a salary structure
  which encourages individuals to attain the skills
  and knowledge necessary to increase their value
  to UHD, both on an individual basis and as a
  participant on a work team and
• Emphasize and recognize the importance of
  exemplary work performance and reward it using
  merit pay programs and/or other forms of formal
  recognition including non-cash rewards.

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SECTION 3 COMMUNICATIONS
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Section 3Communications

• Communications regarding the classification and
  compensation program were an essential part of
  the entire process. The UHD ESO team, in
  collaboration and cooperation with Deloitte
  Consulting, were diligent in their efforts to
  keep UHD employees informed on the status of the
  project, addressing their questions, issues and
  concerns directly and encouraging employee
  involvement throughout the duration of the
  project. Communication included memoranda
  scheduled meetings with the UHD ESO team to keep
  them abreast of all work steps and
  project-related information and to encourage
  their involvement on project management
  decisions open employee meetings to inform
  employees of the objectives of the study, answer
  questions, and listen to any thoughts or comments
  with respect to the current UHD classification
  and compensation program key stakeholder
  interviews pre- and post-study meetings with
  department heads for information sharing and
  reporting and PDQ and supervisor questionnaire
  (SPDQ) administration.
• In addition, Deloitte Consulting drafted an
  employee communication brochure entitled
  University of Houston-Downtowns Classification
  and Compensation Program What It Means to You.
  The purpose is to provide a copy of this brochure
  to each UHD employee and thereby provide a
  thorough overview of the classification and
  compensation program.

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SECTION 4POSITION ANALYSIS
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Section 4Position Analysis

• The task of analyzing each UHD non-faculty
  position was comprised of a process which
  included a requirement for all UHD employees to
  complete a PDQ designed to obtain general
  information related to the primary purpose,
  duties and responsibilities, qualifications, and
  specifications for their position. Upon
  completion, the PDQs were emailed directly to
  Deloitte Consulting for review. All UHD
  supervisors were encouraged to complete a
  supervisor PDQ (SPDQ) that reviewed the PDQs of
  their subordinates to ensure consistent and
  accurate responses. All SPDQs were also sent
  directly to Deloitte Consulting via email. The
  PDQs were used primarily for preparing job
  descriptions, editing and standardizing job
  titles and selecting benchmark jobs. The PDQs
  were not used to evaluate a persons worth in the
  position, place he or she in a pay range and/or
  evaluate their performance in a position.

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SECTION 5EXTERNAL ANALYSIS - MARKET PRICING
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Section 5External Analysis Market Pricing

• In addition to assessing the current pay,
  Deloitte Consulting conducted a competitive
  market analysis of the established benchmark
  jobs. The market analysis of UHDs base salary
  compensation levels involved comparisons with
  similar jobs in the public and private sector
  (including non-profit organizations as well as
  for-profit companies). The comparisons were
  drawn on the following basis
• Utilizing the PDQs completed by UHD employees and
  input from the UHD ESO team when necessary, UHD
  jobs were compared to summary job descriptions in
  relevant commercially published surveys.
• Market comparables were made for 122 jobs out of
  242 jobs within UHD these benchmark jobs were
  representative of all departments and levels
  within UHD.
• The market analysis included data from 17
  recently conducted and commercially published
  salary surveys. Market data was adjusted by an
  annual salary market index of 3.3 from the
  survey effective date to July 1, 2006.

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Section 5External Analysis Market Pricing

• Jobs were analyzed with a local, regional, or
  national market focus depending on relevant scope
  factors which effectively defined the market for
  a specific job. A rule of thumb is to determine
  where UHD typically recruits from to fill a job
  vacancy and conversely where UHD typically loses
  people to in the market. These scope factors
  considered in the market comparisons, for
  example, include the following local, regional,
  national, industry (e.g., colleges/universities),
  budget/revenue size and/or for-profit/not-for-prof
  it companies, etc.
• During the Job Value MatrixTM (JVM) sessions
  the ESO team, including UHD department heads, had
  the opportunity to discuss any anomalies in their
  organization and/or with certain jobs during the
  scheduled meetings. Explanations of the market
  analysis reports and discussions regarding
  matches were provided when necessary.
• Deloitte Consulting and the ESO team reconciled
  the JVM results across UHD to ensure campus-wide
  equity. Further input from UHD department heads
  was sought out in some instances. The final
  recommendation was sent out to UHD department
  heads for their review. Deloitte Consulting then
  presented the study findings with the minimum
  cost impact to the UHD President for final
  approval and implementation.

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Section 5External Analysis Market Pricing

• When comparing an individual employees position
  versus the market median or UHDs overall average
  versus the market, a few points should be
  considered prior to drawing conclusions
• Length of time the employee(s) has held the
  position Typically, a new employee has not had
  a chance to assume all the responsibilities of
  the position. As the employee grows in the job,
  pay increases will enhance pay and pay
  progression, thereby, moving the employee closer
  to the market median over a reasonable amount of
  time (typically 3 to 5 years) depending on the
  nature and level of the job.
• Previous employee(s) work experience Typically,
  employees with previous applicable work
  experience will be paid further in the range than
  less experienced employees depending on the
  amount and quality of work experience.
• Employee(s) job performance Typically, job
  performance will determine how fast and how far
  employees move through their ranges. Length of
  time an employee has held a position, previous
  employee work experience, and job performance are
  not mutually exclusive of each other in
  determining range penetration for an employee.

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Section 5External Analysis Market Pricing

• Overall compa-ratio For the purposes of this
  report, this statistic expresses the relationship
  of the average incumbent pay to the midpoint of
  the salary range. The average incumbent pay has
  been adjusted for those employees who fell below
  the minimum of their new salary grade. When
  creating a salary structure, the midpoint of the
  salary range typically represents the market
  median therefore, the compa-ratio indicates how
  correlated an organization's salaries are to the
  market. The average compa-ratio for UHD is
  approximately 89. Most organizations strive for
  a compa-ratio of 100, which would indicate they
  are highly correlated to the market. Having a
  compa-ratio less than 100 would therefore
  illustrate that UHD is paying on average 11
  below the market median. Typically, a more
  tenured workforce will tend to have a higher
  compa-ratio (often above 100) than a workforce
  with a shorter service history at the
  organization. In addition, compa-ratios vary
  according to how long an individual has been in
  the job, previous work experience and job
  performance. The appropriateness of UHDs market
  position for a job should be determined by the
  competitiveness of the overall total compensation
  package of UHD including benefits and even
  intangible rewards (e.g., amiable work
  environments, opportunities for advancement,
  etc.).

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SECTION 6SALARY GRADES AND RANGES
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Section 6Salary Grades and Ranges

• Using the external market data collected for the
  benchmark positions, two pay structures were
  developed for all non-faculty, non-police UHD
  positions Non-IT staff positions and IT staff
  positions.

MINIMUM The minimum salary rate that is normally
paid to a employee who is beginning the duties of
the job and meets the minimum requirements of the
job. Represents the typical marketplace entry
rate. MIDPOINT The rate which should be targeted
for UHD employees who are fully qualified and
consistently perform the responsibilities of the
position at a satisfactory performance level.
Represents the competitive going rate in the
marketplace for a fully competent
employee. MAXIMUM The maximum salary rate that
should normally be paid to very experienced UHD
employees whose performance consistently exceeds
expected results of the job over the duration of
the classification and compensation program UHD
has adopted.
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Section 6Salary Grades and Ranges

• CLASSIFIED SALARY STRUCTURE
• The recommended salary structure for non-IT staff
  positions includes 25 pay grades. The width of
  each grade (i.e., typically referred to as pay
  range or pay spread) is the spread from the
  minimum to the maximum of the range. The pay
  range begins at 35 for those jobs in Grade 10
  and increases to 65 for jobs in Grade 34. The
  recommended salary structure for IT staff
  includes 17 pay grades with a range spread at the
  bottom of 45 and 65 at the top.
• Range spreads vary based on promotional
  opportunities and the level and sophistication of
  skills required for a given employee population.
  The ranges for each individual employee are
  calibrated to fluctuate based on the recommended
  grade for the employees job, the number of days
  per year and the hours per day the employee
  works.
• Entry level positions that require skills that
  are quickly mastered usually have narrower pay
  ranges than supervisory or managerial or
  higher-level technical positions. Additionally,
  individuals in lower-level positions typically
  have a greater number of opportunities over time
  to be promoted to higher level positions.
• Senior-level positions typically require a longer
  learning curve and often have less structured
  jobs resulting in greater individual performance
  differences and variability among job
  responsibility. Therefore, range spreads for
  senior-level positions are generally wider to
  provide for more pay opportunity for individual
  career growth.
• In addition to the range width, a salary
  structure contains midpoint differentials.
  Midpoint differentials refer to the percentage
  between pay-grade midpoints. The midpoint
  differential for the non-IT staff salary
  structure is 9 on average between grades and 10
  on average for the IT salary structure, which is
  a reasonable average differential between grades
  that will alleviate potential compression issues.

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SECTION 7JOB HIERARCHY AND TARGET PAY RANGE
ASSIGNMENT
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Section 7Job Hierarchy and Target Pay Range
Assignment

• Deloitte Consulting set up an initial matrix
  hierarchy (ranking) using only the information
  derived from the market analysis. The market
  median was computed for each benchmark job and
  this market median determined the initial grade
  assignment by slotting it to the closest
  structure midpoint. For those jobs with no
  market data available (non-benchmark jobs), the
  UHD department head was asked to slot the job
  using their knowledge of specific job factors
  (scope of responsibility and accountability,
  required skill sets and general qualifications,
  supervisory responsibility, etc.) and value to
  UHD in relation to other jobs in the organization
  hierarchy. Any hierarchical differences that
  existed between the market and internal values
  were reconciled by the ESO team with assistance
  provided as needed by Deloitte Consulting.
• The ESO team, with Deloitte Consulting, confirmed
  and reconciled the assigned grades across all
  departments. The final approval came from the
  ESO team on all jobs and the grades in which they
  were placed. This JVM process of reconciling
  differences between the external market and
  internal relationships, is critical to an
  effective job evaluation system.
• After reviewing all recommended pay range
  assignments and reconciling any differences that
  existed across the entire organization and
  considering all proposed grades from the ESO
  team, the resulting pay range assignment for each
  job represented a salary range (i.e., pay
  potential) that reflected the ESO team and UHD
  department heads assessment of its worth (i.e.,
  job value).

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SECTION 8IMPACT OF SALARY STRUCTURE
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Section 8Impact of Salary Structure

• Once all jobs received a recommended grade
  assignment, the immediate cost impact of those
  assignments in the salary structure was analyzed.
  Typically, the most immediate cost of
  implementing a compensation program is adjusting
  those employees salaries that fell below the
  minimum of their assigned salary range in the
  proposed structure.
• As illustrated in the graph below 104 positions
  or 25 of UHD employees fell below the minimum of
  their salary grade.

The cost of adjusting those employees to the
minimum was approximately 269,045, which is
approximately a 1.7 increase over the current
base salary of 15,970,005. In addition, it was
found that 2 (5 employees) were currently paid
above the maximum of the assigned salary range
amounting to 27,552.
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SECTION 9RECOMMENDATIONS FOR IMPLEMENTATION AND
THE ONGOING MAINTENANCE OF THE CLASSIFICATION AND
COMPENSATION PROGRAM
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Section 9Recommendations for Implementation and
the Ongoing Maintenance of the Classification and
Compensation Program

• Ongoing maintenance of the Classification and
  Compensation Program is critical to the effective
  life of the program. At a minimum, we
  recommend that UHD commit to the following
  administrative procedures and policy guidelines

• ADMINISTRATIVE PROCEDURES
• Develop an appropriate communication strategy
  addressing all employees that briefly explains
  the outcome of the Classification and
  Compensation Study and UHDs strategy for
  implementation of the new program.
• Develop a formal strategy for making appropriate
  salary adjustments over a specified period of
  time (e.g., six months, one year, or longer)
  beginning with those individuals who are
  currently paid below the minimum of their salary
  range.
• Develop a formal strategy to be followed for
  those individuals who are paid above the maximum
  of their salary range.
• Because UHDs salary ranges are based upon
  current competitive salaries, UHD should keep
  abreast of any changes in the markets for which
  UHD competes for talent. We recommend that UHD
  review salaries in the market for a sample of
  jobs (30-40) once each year. These jobs should
  be benchmark jobs or those that are easily
  found in published survey sources and
  representative of all levels within UHD.

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Section 9Recommendations for Implementation and
the Ongoing Maintenance of the Classification and
Compensation Program

• For the most part, we recommend that these
  benchmark jobs remain the same from year to year
  in order to obtain the best perception of salary
  movement trends in the marketplace. This annual
  review may be done by UHD with or without the
  assistance of Deloitte Consulting.

• UHD should make recommendations, as appropriate,
  with respect to salary structure adjustments to
  ensure the competitiveness of the salary program.
  Most organizations who monitor the competitive
  marketplace for salary movement (e.g.,
  referencing WorldatWork and/or conducting ongoing
  benchmark analysis) will recommend adjustments to
  their own salary ranges annually or every two
  years. Any recommendations, however, should
  consider both UHDs current pay strategy relative
  to the market and ability to afford any
  adjustments to individual salaries that might be
  suggested by a change in salary ranges.
• Develop and implement formal, written policies
  and procedures for job evaluation classification
  and salary administration.
• Provide initial and ongoing supervisory training
  with respect to the policies and procedures for
  the salary administration program to all
  supervisors.

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Section 9Recommendations for Implementation and
the Ongoing Maintenance of the Classification and
Compensation Program

• POLICY GUIDELINES
• Plan Implementation
• All personnel employed by UHD should be assigned
  to a position which corresponds directly to the
  established salary structure. The rate of
  paydays or 2,080 hours in a fiscal year for the
  schedule is depicted in annual terms to establish
  a common and standard reference point, i.e.,
  2,080 hours or 260 days. Formulas should be
  applied consistently in calculating either annual
  salary or hourly rates which deviate from those
  standard rates, i.e., working less than 260 days
  or 2,080 hours in a contract year.
• Maximum or Above Maximum of Range Any personnel
  at or above the maximum of their respective pay
  grade should receive no pay increase added to
  base pay until such time that the maximum of that
  pay grade is adjusted upward and the salary
  structure reflects such change. Employees at the
  maximum or over the maximum of their salary grade
  could be eligible to receive an annual lump sum
  payment based on merit (i.e., not added to
  current pay) until such time that the salary
  falls within the pay range.
• Within the Pay Range All personnel who fall
  within the pay range for their respective job
  should be placed within the range, which has been
  adopted and incorporated into the salary
  structure.
• Below Minimum of the Pay Range All personnel
  will be within the pay range of an assigned
  grade no personnel should be paid below the
  minimum of their respective job grade as
  prescribed by the proposed salary structure
  unless the individual(s) is an anomaly and/or
  noted exception.

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Section 9Recommendations for Implementation and
the Ongoing Maintenance of the Classification and
Compensation Program

• Advancement
• UHD employees will have the opportunity to
  advance within their pay grade based on tenure in
  their position and/or at UHD. Advancement can
  also be based on having a minimum of average
  performance rating on file.
• Promotion
• Any UHD employee appointed to a new position in a
  job at a higher grade should receive a pay
  increase which is either equivalent to the
  minimum of the new pay grade or seven (7) percent
  above the individuals present salary, whichever
  is higher. (Note This pay increase is subject
  to the financial resources to pay such an
  increase).
• Employees should successfully complete the
  probationary period for their respective new
  position, i.e., six (6) months for hourly
  employees (non-exempt) or twelve (12) months for
  salaried employees (exempt). If for any reason
  employees are transferred back to their former
  position or a similar position within the same
  grade as their former position during the
  probationary period, salaries should be
  immediately reduced to the amount earned prior to
  promotion.

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Section 9Recommendations for Implementation and
the Ongoing Maintenance of the
Classification and Compensation Program

• Hiring
• All individuals who are new UHD employees and
  whose knowledge, skills, abilities, and
  experience meet the minimum requirements of the
  job should be hired at the minimum of the salary
  grade for the job for which they are being hired.
  However, an employee may be hired at a higher
  starting salary based on years of directly
  related and documented work experience, not to
  exceed the mid-point for the respective position,
  provided the salary doesnt exceed that of an
  incumbent in the same position within the same
  department. Related work experience should be
  credited with three (3) percent for each year of
  relevant experience up to five (5) years or
  fifteen (15) percent of the minimum of the
  assigned pay grade.
• Any exception for a new employees salary must be
  based upon the recommendation of the UHD
  department head, and approval by ESO and the
  University President. The primary determinant
  for any exception should be based on a
  combination of the following 1) demonstrated and
  documented need to fill a job 2) the sense of
  urgency to fill such a job 3) the availability
  of qualified individuals with the required level
  of skills, knowledge, experience and competence
  4) the documented competitive market pay required
  to attract and retain a person under these
  exceptional circumstances and 5) the importance
  of maintaining internal equity based on current
  incumbent(s) years of related work experience as
  compared to that of new employee. It is the
  intent of UHD that newly hired employees (within
  the guidelines of exception or otherwise) will
  not receive more favorable treatment than
  existing UHD employees.

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Section 9Recommendations for Implementation and
the Ongoing Maintenance of the
Classification and Compensation Program

• Rehiring
• Former UHD employees rehired within one year into
  a position with the same grade as the one
  previously held should be placed within a pay
  grade of the current salary structure nearest to
  their previous salary, provided UHD requires the
  level of skill, knowledge, experience and/or
  competency a former employee brings to the job.
  In no case should a new salary of a rehired
  employee be above their former salary unless
  there has been incremental change to the current
  salary schedule, or the rehired employee has
  acquired new licensing, certification(s), and/or
  education that provide a value-added to the
  position and under no circumstances should the
  new salary exceed the maximum of the grade.
• Former employees rehired after one years absence
  or rehired for a position in a different salary
  grade should be treated as new employees, i.e.,
  paid up to the midpoint of the range for the
  position for which they are hired.

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Section 9Recommendations for Implementation and
the Ongoing Maintenance of the
Classification and Compensation Program

• Job Re-Evaluation and Reclassification
• When a job is reclassified to a higher pay grade
  because a re-evaluation indicates the major
  duties and responsibilities have increased
  significantly, the employee may be placed at the
  minimum of the new pay grade or receive a four
  (4) percent pay increase above the employees
  current salary, whichever is higher. If such a
  re-evaluation is effective with the beginning of
  a compensation year, the employee should first be
  placed in his/her new grade before granting the
  yearly increase commensurate with the old pay
  grade. An employee should not be paid less than
  the grade minimum or more than the grade maximum
  when a re-evaluation increases a positions
  grade.
• When an employees position is reclassified to a
  lower grade because a re-evaluation indicates
  reduced duties (e.g., due to a program cutback),
  a salary adjustment may occur to ensure
  compliance with UHDs compensation plan. If the
  employees salary is above the maximum of the new
  grade, no annual salary increments should be
  granted until the maximum for the grade is
  increased.
• Once an individual has been appropriately placed
  in his or her new grade, increments will proceed
  under the UHD compensation program advancement
  rules.

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Section 9Recommendations for Implementation and
the Ongoing Maintenance of the Classification and
Compensation Program

• Involuntary Transfer
• When an employee is given an involuntary transfer
  to a position with a lower grade or same grade
  (e.g., staff reduction due to a program cutback),
  a salary adjustment may occur to ensure
  compliance with UHDs compensation plan. If the
  employees salary is above the maximum of the new
  grade, no annual merit salary increments should
  be granted until the maximum for the grade is
  increased. If the individuals salary has not
  reached the maximum of the new category,
  increases should be granted that conform to the
  compensation management (i.e., range penetration)
  guidelines until the grade maximum is attained.
• Voluntary Transfer to a Lower Grade
• If employees are transferred at their own
  request, or at UHDs request, to a position with
  a lower grade, a salary adjustment may occur to
  ensure compliance with UHDs compensation plan.
  An employees pay will remain the same for the
  remainder of the compensation period assuming the
  employees pay falls within the pay range of the
  lower grade associated with the transfer.
  However, under no circumstances will any transfer
  or move to a lower grade exceed the maximum pay
  for that job.

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Section 9Recommendations for Implementation and
the Ongoing Maintenance of the Classification and
Compensation Program

• Interim Job Appointment
• Employees appointed to the acting capacity of a
  supervisor or other management position may be
  given a salary adjustment for the period of the
  assignment to the position. The adjustment for
  the interim job appointment is between 5 and 7
  of the salary of the appointee, as recommended by
  hiring manager and approved by Manager of
  Compensation. NOTE This adjustment is subject
  to the financial resources to make such an
  adjustment. Non-Exempt positions may be eligible
  for interim appointment on a case by case basis,
  as approved by the Manager of Compensation.
• New Positions
• With regard to new positions, a job description
  should be prepared and the position should be
  evaluated and assigned to a salary grade by
  Employment Services and Operations and before the
  position is advertised, an employment offer is
  tendered or a salary is established. The
  appropriate Department Head/Director responsible
  for the new position should offer recommendations
  to Employment Services and Operations for his/her
  disposition and/or action.
• Positions under consideration should be evaluated
  in accordance with the appropriate position
  evaluation plan (i.e., Job Value Matrix) and the
  results of the evaluation should be compared with
  previously evaluated jobs to ensure internal
  equity. That is, these new jobs should be
  slotted into the current structure based on the
  level and scope of responsibility, duties
  performed and the value in relation to other jobs
  in the hierarchy. In addition, new positions
  should be benchmarked to the market if applicable
  to assist in the salary grade assignment of the
  new job.

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38
Section 9Recommendations for Implementation and
the Ongoing Maintenance of the Classification and
Compensation Program

• Nonexempt Employee Pay
• UHD non-exempt employees will be paid one and
  one-half times their regular hourly rate of pay
  for all hours worked in excess of 40 hours in a
  work week, depending upon schedules assigned.
  When financial resources do not allow for one and
  one-half pay, non-exempt employees may be
  compensated with one and one-half compensatory
  time off.
• Exempt Employee Pay
• Exempt employees are not eligible for overtime
  pay as outlined in the Fair Labor Standards Act.
  
• Exceptions to this policy will be recognized for
  exempt personnel in certain job classifications.
  Instances that may lead to compensation for
  overtime hours include (a) to remain competitive
  in labor market and (b) working out of job
  classification in order to provide staff
  coverage.
• The Vice President for Employment Services and
  Operations, in coordination with the Department
  Head/Director, must approve exempt positions
  authorized for payment of (straight time)
  overtime.
• Exempt employees eligible to receive payment for
  overtime will be paid in accordance with UHDs
  approved schedule.

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39
Appendices
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Appendix IProject Guidance Team

• Ivonne Montalbano
• Vice President for Employment Services and
  Operations
• Tomas Turrubiates
• Manager of Compensation

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Appendix IICompensation and Classification
Program What It Means To You

• University of Houston-Downtown
• COMPENSATION AND CLASSIFICATION PROGRAM
• What It Means To You
• Prepared by
• Deloitte Consulting, LLP
• 333 Clay Street
• Suite 2300
• Houston, Texas 77002
• [phone]

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Appendix IICompensation and Classification
Program What It Means To You

• All employees contribute to the success of the
  University of Houston-Downtown (UHD). The
  collective efforts of you and your fellow
  employees determine the quality of services we
  provide to our students and community.
• We recognize the two-way commitment necessary to
  fulfill our goals. We have an obligation to
  provide you fair compensation that is based on
  your experience, the complexity of your position,
  and the salary and wages budgeted by UHD and
  approved by the UHS Board of Regents. Your
  obligations to UHD include effective performance
  in your position and demonstration of our
  philosophy to set a standard of excellence in
  virtually every facet of higher education.
• The wages/salaries you receive are based on an
  objectively determined and fairly administered
  compensation and classification program wherein
  you can be assured that you are receiving pay
  that is competitive and fair for your position.
• The key to the success of the Compensation and
  Classification Program (Program) is a clear
  understanding of how it is designed and how it
  works.
• The purpose of this brochure is to provide you
  with an overview of UHDs Compensation and
  Classification Program-- what it is and what it
  means to you.

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Appendix IICompensation and Classification
Program What It Means To You

• Program Objectives
• At UHD, we believe in paying what a position is
  worth and rewarding employees for experience and
  work-related performance. UHD realizes that our
  future success depends heavily on your ability to
  grow and develop within UHD and be rewarded with
  a fair salary in relation to your experience,
  commitment, contribution, and value of the
  position.
• We designed the Program around characteristics
  that will make it operate effectively on a
  continuing basis.
• Internally Equitable The Program provides
  salary ranges for all positions that fairly
  reflect the value of each position, relative to
  all other positions at UHD.
• Externally Competitive So that we can continue
  to attract highly qualified personnel available,
  our salary ranges will be competitive with
  similar positions in other higher education
  institutions, not-for-profit organizations in the
  public sector, as well as the private sector.
• Continuous and Flexible The Program will
  respond to changes in the work marketplace
  provide for the evaluation of new position
  specifications as they are created and be easily
  administered.
• Personally Motivating The Program provides
  opportunities for recognizing and rewarding
  experience, contribution, and commitment.

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44
Appendix IICompensation and Classification
Program What It Means To You
How the Program Works Here is how the
Compensation and Classification Program works.

• Positions are formally described to obtain a
  clear understanding of what each position is
  expected to accomplish.
• Pay for comparable positions in other
  not-for-profit organizations in the public sector
  as well as relevant private sector organizations
  is determined through surveys and market
  analysis.
• Each position is evaluated using a dynamic
  position value matrix and slotting system to
  determine the value of the position in relation
  to all other positions at UHD.
• Positions with similar levels of
  responsibilities are assigned a competitive pay
  grade and salary range, each salary range has a
  pay grade designated for it
• ... and pay increases are determined by shifts
  in the market rates and the impact on the salary
  structure and UHD salary and wages budget.

JOB DOCUMENTATION
MARKET PRICING
JOB EVALUATION
GRADES/SALARY RANGES
PAY INCREASES
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Appendix IICompensation and Classification
Program What It Means To You

• Position Documentation
• The first step in designing a pay program is to
  obtain a clear understanding of what each
  position is expected to accomplish. This is done
  by completing written descriptions (position
  specifications) for each position. The position
  specifications list the qualifications (training,
  education, experience and the like) required to
  obtain the position, as well as the position
  duties and responsibilities involved in its
  performance (what you are expected to do). Each
  position is expected to accomplish specific end
  results and position descriptions provide a
  record of the most important facts about the
  position.
• Because of their importance, position
  specifications are updated as needed. In this
  way, you can be sure that the descriptions, as
  well as the evaluation and salary range developed
  from it, are current and accurately reflect the
  worth of your position to UHD.
• It is important to keep in mind that only
  positions are analyzed, not people.
• Market Pricing
• Making sure that the levels of pay at UHD are
  comparable to other higher education
  institutions, not-for-profit organizations, as
  well as the public and private sector requires a
  thorough analysis of what other organizations
  pay. Since UHD uses position specifications that
  are consistent with the position descriptions
  used by other organizations, it is possible to
  compare directly for many of our positions.

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Appendix IICompensation and Classification
Program What It Means To You

• Market Pricing Contd
• Best practices suggest that organizations utilize
  several salary surveys locally, regionally, and
  nationally to determine how much other
  organizations are paying. Because UHD wants to
  compare positions accurately, we selected surveys
  that best represent where our potential employees
  are likely to be hired. For example, UHD could
  use local surveys for those positions that may be
  filled in the general Houston area. Regional
  surveys could be used for those positions where
  we must look beyond our immediate geographical
  area. National surveys could be used for
  positions where UHD must extend a search even
  further. By taking the surveys and applying
  sound judgment, UHD can accurately market price
  a position and reflect the so-called going rate
  or market average for a fully competent person to
  fill a position at UHD.
• To make sure our policy remains current, it is
  recommended that market information be reviewed
  at least annually. In this way, we can be
  certain that UHD remains competitive in the
  marketplace.

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Appendix IICompensation and Classification
Program What It Means To You

• Evaluating Positions
• Determine the value of each position
• Show the relationship of one position to another
• Assign each position a pay grade reflecting the
  positions value
• The position evaluation system used to analyze
  each position is the same process used by
  thousands of organizations throughout the country
  and around the world. And since each position is
  evaluated using this same process, you can be
  assured that our positions are accurately and
  fairly given a value based on the same criteria.
• Its important to remember that, in this stage of
  the program, no attempt is made to evaluate the
  person in the position or that persons
  performance. We consider only the position
  itself, as defined by its position specification.

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Appendix IICompensation and Classification
Program What It Means To You

• Grades/Salary Ranges
• After positions are evaluated and a market
  average is determined, they are assigned a salary
  range in the salary structure to reflect the
  positions value to UHD and external pay
  practices. The structure consists of salary
  grades and ranges of pay opportunity with a
  minimum and maximum established around a
  midpoint. Each pay grade range provides
  sufficient room and opportunity to recognize
  competency, performance, and amount of
  experience.

MINIMUM The minimum salary rate that normally
would be paid to a member of UHD staff who is
beginning the duties of the position and meets
the minimum requirements of the position.
Represents the typical marketplace entry
rate. MIDPOINT The rate which should be targeted
for employees who are fully qualified to perform
the responsibilities of the position at a
satisfactory performance level. Represents the
competitive going rate in the marketplace for a
fully qualified employee. MAXIMUM The Maximum is
the highest level of pay for a job within this
grade. Employees may not be paid at a base rate
above this amount, nor receive any merit
increases resulting in a rate of pay above this
amount. Employees who have extensive work
experience, are highly competent professionally,
and may have a significant number of years of
experience are generally paid between the
Midpoint and the Maximum of the pay range.
Remember that the salary range is based on the
characteristics of the position and not the
skills of the person holding that position. When
necessary, our salary ranges are adjusted to
reflect changes in the marketplace.
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49
Appendix IICompensation and Classification
Program What It Means To You

• Summary
• UHDs Compensation and Classification Program is
  designed to make sure you are paid fairly and
  competitively. Our Program also provides for
  your salary to grow as you grow and perform in
  your position.
• As positions change, new positions are added or
  competitive conditions change, the Program will
  take these factors into account so that you and
  all employees will continue to be paid on a fair
  and equitable basis.

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Appendix IIIPosition Description Questionnaire
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Appendix IIIPosition Description Questionnaire


For a full set of this PDQ, please visit the
Compensation/Performance link found on the ESO
website.
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Appendix IVMarket Survey Sources
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Appendix VSalary Structure Non-IT Positions
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Appendix VISalary Structure IT Positions
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Appendix VIIJob Evaluation Methodology
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