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Introduction of Total Rewards & Implementation of Market Pay Zones

Introduction of Total Rewards & Implementation of Market Pay Zones. Presented by: UMHS Compensation 5/15/08. Objectives. Share work to date regarding the Total Rewards Model Process for support Outcomes of Market Pay Zone Management Review period for staff in CFCS

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Introduction of Total Rewards & Implementation of Market Pay Zones

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  1. Introduction of Total Rewards & Implementation of Market Pay Zones Presented by: UMHS Compensation 5/15/08

  2. Objectives • Share work to date regarding the Total Rewards Model • Process for support • Outcomes of Market Pay Zone Management Review period for staff in CFCS • Introduce UMHS Total Rewards Philosophy for UMHS • Formalize UMHS Compensation philosophy • Gain support on next steps toward implementation of Market Pay Zone structure • Compensation guidelines

  3. TOTAL REWARDS STRATEGY Benefits -Health -Dental -Life & Disability -Retirement Compensation -Base Pay -Variable Pay -Other Pay Work Experience -Training/Development -Work/Life -Cultural -Recognition -Develop Pay Structure -Validate Structure -Develop Salary Administration Guidelines -Communicate/Educate -Conduct Benefits Study -Identify market position -Communicate/Educate -Identify approach to illustrate value of work experience -Communicate/Educate Total Rewards - The End in Mind TOTAL REWARDS TOOLS -Website -Statements

  4. Become Widely Recognized As a Great Place to Work Workforce Investment Plan 2003 to Present UMHS Current Strategies – WIP Re-Recruit Current Employees Mentoring, Mentoring, Mentoring Invest in Leadership Development Expand and Diversify the Potential Applicant Pool Coordinate Recruitment Efforts .

  5. Management ReviewPurpose UMHS Executive Leadership expressed interest in gaining organizational support: • Introduceand gain support on “Total Rewards” model and new base pay structure Meet with Management to understand: • Current departmental compensation practices • Organizational “fit” of proposed base pay structure • Desired compensation guidelines & resources • Zone implementation preferences

  6. Management Review Communication Process Management Review Period : • General information via Total Rewards website • Department specific information via UMHS HR Consultants • 1:1 meetings with Department Management • All feedback was documented • Department specific issues are being resolved with the department/HR • Organizational issues are being resolved with appropriate stakeholders

  7. Market Pay Zone Review Outcomes Review period itself was well-received: • Continued dialog on implementation of new classification system and UMHS compensation practices • Continued improvement of job classification within the new system • Process supported philosophy of “transparent” HR practices • 1:1 communication to discuss business needs

  8. Market Pay Zone Review Outcomes Management expressed support for: • Total Rewards Model • Integrated design of compensation, benefits and work experience programs to support recruitment and retention • Target market competitive pay for UMHS positions • Market target is higher for some positions • The proposed Market Pay Zone structure

  9. Market Pay Zones Outcomes Management expressed interest in: • Formalized compensation philosophy as part of a UMHS Total Rewards philosophy • Formalized compensation guidelines to ensure department compensation practices align with leadership intentions • Consistent compensation practices • A “management implementation” period of market pay zone structure and accompanying guidelines

  10. Market Pay Zones Outcomes • More information on current UMHS compensation, benefits, and work experience programs • To assist in recruitment and retention of staff • To support selected rewards strategy (competitive advantage of creating the ideal work experience) • Information on common career paths and growth opportunities in UMHS

  11. Market Pay Zone ReviewOutcomes Over 600 market titles/zones out for review: • Approx. 85% market titles/zones have been “validated”; • Reviewed, discussed and support recruitment/retention • Some with recommended changes: • To align with internal pay relationships • Core positions with recruiting and retention challenges • Remainder require further review: • Market titles with utilization or design issues • Director level titles require more review to ensure proper pay relationships

  12. Recommendations

  13. Recommendations • Formalize UMHS Total Rewards Philosophy • To set guiding principles for the design of compensation, benefits, and work experience programs • Considerations: • Organizational fit of guiding principles • Identification of desired market position for programs

  14. Recommendations • Formalize UMHS Compensation Philosophy • To set guiding principles for the design of compensation programs • Considerations: • Identification of desired market position (w/HSEG) • Identification of pay factors (importance of performance, LOS) • Balance of internal and external equity

  15. Recommendations • Formalize UMHS Compensation Guidelines • To set guidelines around compensation policies & practices: • Considerations: • Placement within new market pay zone • Pay for zone “outliers” (tolerance & criteria) • Pay change guidelines

  16. Experienced/ Competent Staff Midpoint Highly Experienced & Highly Proficient Staff Developing Staff Range of Competitiveness Market Pay Zone Market Pay Zone Placement Guidelines (Sample 1)

  17. Market Pay Zone Placement Guidelines (Sample 2)

  18. Pay Change Guidelines

  19. Pay Change Guidelines

  20. UMHS Pay Administration Pay Policies Pay Laws and Regulations UMHS Pay Administration Compensation Philosophy FY08 Pay Structures Managerial Pay Zones Professional Pay Zones Establishing Pay Rates Adjusting Pay Rates Premium Pay Pay SPGs . UMHS Total Rewards

  21. Next Steps Long-term: • Formalize UMHS Total Rewards strategy • To support UMHS strategic goals • Integrate total rewards in employment brand to fully support recruitment and retention strategies (& WIP) • (i.e., “The MI difference is U ” Rewards) • Individual Total Rewards Statements

  22. Next Steps • What (unit) management should be able to communicate after trial period: • Basics of the Total Rewards Model and how it supports recruitment/retention and our strategic goals • UMHS compensation philosophy, overall targets for owned positions based on metrics and labor market • Pay range for each of the utilized positions and basics of how they were established • Employees’ position in the range and how that relates to peers, market, and performance • Opportunities for career development for staff (next levels and/or closely related market titles)

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