Improving Staff Compensation
Remarks by Larry R. Faulkner, President
University Staff Association Meeting
December 3, 1998
Welch Hall
The University of Texas at Austin
I believe that any discussion about the role, the importance, and the compensation of university staff members must begin with this fundamental premise: A great university relies on the collective talents and ability of individuals within its community. Thus, our success depends upon securing and retaining that talent--the people who make up our faculty, our staff, and our student body. As the modern university has evolved, the delivery of services on campus has become increasingly dependent on the specialized support provided by staff members. That means that staff members are even more important today than in years past. The University has a compelling interest in successfully dealing with staff issues such as employee job satisfaction and competitive compensation and benefits.
I want to acknowledge that when we refer to the staff collectively, we are talking about an enormous array of knowledge, skills, and talent. The staff includes artists, skilled craftsmen, and computer specialists--creative thinkers, gifted managers, and dedicated people who take pride in their work. As president, I've visited many corners of this campus and I recognize that staff members make a tremendous contribution to the life of this institution. I appreciate what you do.
Staff compensation is an issue that I have worked on since my first day on the job last April. That's when I instructed our business affairs executives to begin identifying funding sources for staff pay increases. I'd like to review some of the progress we've made in the eight months that I've been on campus
- On April 30th we received the Compensation Advisory Committee Report. The report identified classified job titles that were being compensated below current market ranges. It also recommended that we raise the minimum pay rate at UT, as well as rates for many other classified positions. The goal of the recommendations is to bring all UT classified positions within the range of compensation levels that exist in the Austin labor market for similar positions.
- On June 1st and September 1st we implemented the first two phases of the recommendations. We also began phase three--merit raises and adjustments necessary to maintain relative balance in pay scales. In order to do this, we significantly increased the pool of funds available for staff compensation.
- Some units augmented the new funds with internal funding, resulting in additional staff increases.
- I am committed to increasing compensation for classified staff members in 1999-2000 to the levels recommended by the Compensation Advisory Committee. In preparing next year's budgets, the executive officers and deans have also been asked to take into account inflation and cost-of-living changes that have occurred since the release of the Committee report.
- Also, I am committed to pursuing, through legislative requests and budget review, the creation of a significant pool of funds for staff merit increases and equity adjustments.
Another important recommendation of the Compensation Advisory Committee was that an ad hoc committee be established to continue to work on these issues. In response to that recommendation, I have appointed the Presidential Committee on Staff Compensation, comprised of 12 members, to advise the administration. Four of the 12 members are classified staff employees. The charge of this committee includes review of staff compensation and benefits, recruitment and retention concerns, and the classification system itself. The committee will be chaired by Edwin Dorn, dean of the LBJ School of Public Affairs. He served as senior advisor for compensation, benefits, and career development at the U.S. Department of Defense, with a work force of more than three million military and civilian employees. I have the utmost confidence in and respect for Dean Dorn.
Some of the members of this new committee are present. Please stand when your name is called. In addition to Dean Dorn, the members are:
Dorothea Adams, associate vice president;
Donna Bellinghausen, assistant to the vice president for student affairs;
Joanna Castillo, computer programmer;
Reuben Gonzales, associate professor;
Brian Graham-Moore, professor;
Mary Knight, associate vice president and budget director;
Joyce Lewandowski, assistant director and financial officer;
Andrea Marks, payroll manager;
Carol Sisson, senior administrative associate;
Russell Walker, accounting group supervisor; and,
Sandra Haire, associate vice president for human resources.
John Moore, who was recently hired to fill a new position that I authorized--assistant director for human resources and compensation--will staff the committee. Dr. Moore has a wealth of experience in compensation and classification systems in public and private sector organizations.
Last week representatives of the University Staff Association presented to me a list of 15 concerns. Some of those topics have already been addressed in my remarks. Let me respond to the others:
While I have discussed initiatives to increase staff compensation for classified staff members, I would like to point out that in adjusting our minimum wage level, our goal was to establish a rate that was both derived from, and in excess of, current labor market conditions. Our resulting minimum pay for entry-level unskilled workers is approximately six percent above the Austin market rate, according to a study by the Texas Workforce Commission. We recognize that the cost of living in the Austin area is expensive. The University is, however, an institution that must operate within the context of market forces. Labor costs are an enormous percentage of our operating budget. The implementation of additional unilateral across-the-board payroll increases is not possible without jeopardizing some existing operations. While we are reviewing all budgets and staffing levels to determine areas that could produce funding flexibility, we also want to avoid situations that could result in unit closures and layoffs.
Another issue raised by the Staff Association is that of the fairness of performance evaluations as they affect compensation. I agree that we need uniform, high quality evaluations in order for the system to work. The Office of Human Resources, under the leadership of Vice President James Hill and Associate Vice President Sandra Haire, is in the process of revising the performance management system and developing training for every supervisor on campus to conduct more effective performance evaluations.
As for the suggestion that we freeze salaries of higher-compensated employees, I return to my opening statement. The quality of a university depends on attracting and retaining talent--at all levels. If we are unable to do that, our quality, and thus our funding, will rapidly erode. Such a scenario will not improve The University or enhance the prospects for attaining higher staff compensation.
The Staff Association proposes that all employees be afforded an opportunity to choose their retirement plan. The administration has no stake in prohibiting employees from participating in the Optional Retirement Plan. The UT-Austin administration does not control these policies--they are determined by the Legislature and the Higher Education Coordinating Board. I will explore what can be done to expand employee options. This is an issue that primarily relates to newer employees, since it is rarely beneficial for long-time employees to change retirement plans.The disparity between the retirement benefit-multiplying factor of the Teacher Retirement System and the State Employee Retirement System has been raised as an issue. The Legislature controls this matter. We will encourage the Legislature, through our governmental relations staff, to equalize the benefits of the two retirement systems.
In the eight months that I have been on campus, I have heard many concerns about flaws within the classification system. Because these factors are inextricably linked to compensation, the Presidential Committee on Staff Compensation has been charged with reevaluating the classification system. We must bear in mind that we work in a complex organization and there can be vast differences of responsibility among positions with the same title. If we enforce strict internal pay levels among job titles, the effect will be to assign the lowest compensation rate to all, which is not fair. Management must have the latitude to recognize varying levels of responsibility within a job title and to reward strong performance. It is rare that a compensation system does not generate controversy of some kind.
I support the concept of creating career life cycles. In doing so we can help define a career path that encourages individual development and recognizes achievement through progressive titles and compensation. This type of advancement is often associated with expanding skills and responsibilities and is easier to define when there is a larger population of employees within a category, such as administrative assistants. On the other hand, it is difficult to design a career path for some highly specialized positions. For example, it might be hard to create a career life cycle for a glassblower, if, as is the case, we only employ one glassblower at The University. So while I am in favor of this concept, it is not always practical.
I will appoint a separate committee early next year to study the question of staff grievances. We need to determine how other universities handle this issue and those regarding staff advocacy. I will ask the committee to submit its report by the end of the spring semester.
I agree that The University needs more staff representation on university committees. In fairness, I think we must acknowledge that we have made significant progress in this area in recent years. The staff possesses even more operational knowledge and expertise than in the past and it is in The University's best interest to include the benefit of that knowledge in the decision making process. Many of these committee appointments are made by vice presidents, deans, and department heads, and I will encourage them to make additional staff appointments.
At the end of the University Staff Association list of concerns are several topics that were not described as key issues or as recommendations. Let me take a moment to review several of these:
- The Presidential Committee on Staff Compensation will review the issues of tuition waivers, parking, and other benefits.
- As I have stated many times, I consider diversity on our campus to be a high priority and we are working on all practical and legal means to promote a University community that is representative of the entire population of Texas.
Finally, I think it is important to recognize that The University administration and staff have common goals. Let me share with you these passages from our compensation philosophy statement:
In order to fulfill its mission, The University of Texas at Austin must attract and retain an outstanding staff. To meet institutional staffing needs and priorities, the compensation system established in support of this goal includes the following objectives:
- To establish compensation levels for positions on the basis of their relative internal worth and external competitiveness within relevant labor markets;
- To reward employees on the basis of work performance;
- To administer pay equitably and consistently;
- To establish a compensation policy that is consistent with the judicious expenditure of funds entrusted to The University...
Thank you for everything you do for The University. I believe we have made progress this year. It is clear that we have more work ahead of us, and I will need your help. Let's work together to advance the mission of The University of Texas at Austin--and to make the campus the best work environment it can be.
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