Comp U—Montgomery College

Prepared by Aon Hewitt

Talent, Rewards & Performance | Broad-Based Compensation

Presentation to Montgomery Community College

2017

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Learning Objectives

The learning objectives for the Compensation 101 course are as follows:

!  Explain Montgomery College’s Compensation Philosophy

!  Describe the importance of accurate and thorough job documentation

!  Describe the various approaches of determining the value of a job balancing internal and

external value

!  Define market pricing and discuss the processes taken to market price a job

!  Describe the importance of a salary structure and its purpose

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Table of Contents

!  Compensation Strategy 4

!  Position Descriptions 11

!  Job Evaluation 24

!  Market Pricing 31

!  Structure Development 48

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Compensation Strategy

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Linking Compensation Strategy to Organization Strategy

Culture

Organization Strategy

Supporting Strategy

Implementation

Global

Economic

Government Political Regulation

Competition

Technology

Stakeholders

Facilities

Financial

Human

Resources

Operations

!  Recruitment Staffing

!  Development

!  Compensation

!  Benefits

!  Communication

!  Labor Relations

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How an institution decides to

manage human assets and

provide basic HR services

How an institution decides to

use compensation to attract,

retain, motivate, and reward

employees in supporting the

business and human resource

strategy

Introduction to Organization Strategy

Different Types of Strategies

The science and art of

employing the political,

economic, and psychological

forces of a group to afford the

maximum support adopted

policies; a careful plan or

method; the art of devising or

employing plans toward a goal

What an institution decides to

do to create value

Human

Resource

Strategy

General

Strategy

Organization

Strategy

Compensation

Strategy

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A Guiding Framework

HR Strategy

Total Compensation Strategy

Work

Environment

Career

Compensation Benefits

Aligned employee behavior that yields improved business results

Strategy

Org

Capabilities

Org

Values

Business Perspective

Demo-

graphics

Competencies

Values

Workforce Perspective

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Financial Rewards

Non-Financial Rewards

Total Rewards

Direct

Indirect

Affiliation

Total Compensation Management

Pay including

base salary,

allowances,

variable pay, and

institution

ownership.

Health care and

other welfare

benefits, paid time

off, provident and

pension funds,

perquisites (i.e.

cars, phones), loan

subsidies, and

recognition.

Opportunity for

personal growth,

capability

improvements,

organizational

advancements,

and employment

security.

Work Content

Career Value

Quality of work

itself including the

variety, challenge,

autonomy, and

meaning. By

extension, this

includes the quality

and impact of

performance

feedback.

Rewards that

accrue from

association with the

organization (i.e.

sense of status,

access that the

organization

provides to

colleagues/other

groups of people).

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Developing a Compensation Strategy

!  Compensation Strategy: How an institution decides to use compensation to attract, retain, motivate,

and reward employees in supporting the organization and HR strategy

!  It is a written statement of compensation philosophies and objectives that are:

–  Consistent with organization strategy and desired culture

–  Direction for administration and design

–  Basis for communication

–  Standard for program evaluation and monitoring

!  Key philosophy topics include:

–  Key organization objectives and strategies

–  Key financial and/or operational measures

–  Behaviors that employees need

–  How pay can support the organization and culture

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Developing Montgomery College’s Compensation Philosophy

Process to develop Montgomery

College’s Compensation

Philosophy included:

!  Leadership input

!  Draft Compensation

Philosophy

!  Refinement of Compensation

Philosophy based on feedback

from leadership

!  Gathered additional feedback

from multiple councils college

wide

!  Developed final version and

gained approval from senior

leadership

Note: The College’s Compensation

Philosophy can be found on the HRSTM’s

website on the Classification and

Compensation page.

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Position Descriptions

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Overview

!  Why Job Documentation?

!  Guidelines for Writing Position Descriptions

!  Tips and Resources for Maintaining Job Description

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Why Job Documentation?

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Job Documentation as a Component of Compensation

Job documentation provides the foundation for an integrated HR infrastructure by enabling us to

categorize jobs into classes, levels, and ultimately, an organization-wide job framework. This job

framework will serve as the basis for creating a range of HR initiatives such as career paths and a

compensation structure.

Compensation Strategy

Job

Documentation

Job Analysis

Market Pricing

Job Evaluation

Pay Structures Pay Delivery

!  Market adjustments

!  Merit increases

!  Bonus payments

!  Promotions

What the job does

Written job description

Internal hierarchy

of job “worth”

What does the external

market pay?

!  Compensation bands

!  Compensation ranges

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Why Job Documentation?

!  Job documentation is the primary source of information when beginning to determine the value of

work; it provides the foundation for determining the internal value of jobs or helps match jobs to the

market with salary surveys

!  Organizations use job documentation for many purposes:

–  Determining internal job worth

–  Matching internal jobs to external salary surveys

–  Describing a job to applicants

–  Identifying career paths and succession planning

–  Identifying training needs

–  Determining the qualifications an individual must

have for the job

–  Helping to identify the organization's design,

reporting relationships, and contacts

–  Ensuring proper governance and compliance

with regulatory requirements

–  Describing work standards or setting expectations

for performance in the performance review process

Best

Class

Build

Capability

(Career

Development)

Refine Processes

(Workforce Planning,

Staffing, & Succession

Planning)

Set the Foundation

(Compensation & Job Titles)

Integrated HR Programs

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Job Documentation Challenges

!  Keeping the documentation updated

!  Convincing managers of their value

!  Avoiding narrowly defined jobs

!  Avoiding duplication of job documentation across the organization

!  Training non-HR employees to prepare them

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Guidelines for Writing Position

Descriptions

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General Guidelines for Writing Position Descriptions

!  Statements should be as thorough and specific as possible—assume the reader has no knowledge of

the job, what it takes to do the job, and no understanding of the institution’s programs or processes

!  Statements containing special jargon or abbreviations should be avoided or defined within the

statement

!  Statements should contain detailed examples of specific activities which demonstrate actual work or

projects performed by the employees in the job; this is essential to understanding the actual work

performed

!  Statements should be clear in describing the specific roles and responsibilities

!  Statements should focus on the current work actually being performed—not on what the job might

look like in the future or what the manager thinks the incumbent should be doing

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Tips and Resources for Maintaining

Job Documentation

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Action Words

Word Definition

Administer Manage or direct the execution of affairs.

Advise Recommend a course of action; offer an informed opinion based on specialized knowledge.

Aggregate Accumulate and put into order.

Analyze Separate into elements and critically examine.

Approve Accept as satisfactory; exercise final authority with regard to commitment of resources.

Assess Determine/document importance, size, or value.

Assign Specify or designate tasks or duties to be performed by others.

Authorize Approve; empower through vested authority.

Code Write computer language.

Conduct Carry on; direct the execution of.

Control Measure, interpret, and evaluate action for conformity with plans or desired results.

Coordinate Regulate, adjust, or combine the actions of others to obtain harmony.

Counsel Advise and consult based on subject knowledge.

Debug Find and remove errors (esp. in computer code/programming).

Design Conceive a plan of action.

Develop Disclose, discover, perfect, or unfold a plan or idea.

Direct Guide work operations through the establishment of objectives, policies, rules, practices, methods, and standards.

Draft A preliminary sketch, version, or plan.

Enter Type into a computer system.

Edit Revise a written document for content and/or style.

Evaluate Determine or fix the value of.

Expedite Accelerate the process or progress of.

Tip

"  Share a list of commonly used verbs and their

definitions with hiring managers. This makes

sure everyone has a common understanding.

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Action Words

Word Definition

Implement Carry out; execute a plan or program.

Investigate Systematic examination to find information.

Maintain Keep in an existing state.

Manage Oversee the execution of tasks, a department, or a function; direct work, allocate resources, approve performance and

results.

Measure Determine the dimensions, quantity, or capacity.

Monitor Compare/audit, usually against pre-determined metrics.

Negotiate Confer with others with an eye to reaching agreement.

Operate Perform an activity or series of activities.

Oversee Supervise, direct, inspect, or guide the work of others with responsibility for meeting standards of performance.

Perform Fulfill or carry out some action.

Plan Devise or project the realization of a course of action.

Recommend Advise or counsel a course of action; offer or suggest for adoption.

Review Evaluate and inspect work outputs or performance.

Research Systematic investigation to find an answer(s).

Schedule Plan a timetable.

Supervise Oversee, direct, inspect, or guide the work of others with responsibility for meeting standards of performance.

Test Determine whether a plan/project/process will be successful.

Train Teach or guide others in order to reach a predetermined standard.

Verify Confirm or establish authenticity; substantiate.

Write Compose a document.

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Sample Position Description – (With Opportunities for Improvement)

Instructional Associate

Department/Unit: Mathematics Dean

Supervisor:

Supervisor Title:

Submitted Date:

Approval Date: 7/4/2012

Approval By:

Section I

Key Work Responsibility 1: 85.00%

Provide instructional assistance to mathematics, accounting, physics, and

engineering students

Key Work Responsibility 2: 4.00%

Help support and maintain a safe, secure, and effective Math, Accounting,

Physics, and Engineering Learning Center

Key Work Responsibility 3: 2.00%

Assist in providing information about the MAPEL Center to the Montgomery

College student body

Key Work Responsibility 4: 5.00%

Assist in training, scheduling, and valuation of student assistants

Key Work Responsibility 5: 2.00%

Provide Montgomery College students with information about mathematics,

accounting, physics, and engineering resources

Key Work Responsibility 6: 2.00%

Communicate with faculty and staff at Montgomery College about ways to

enhance the education of students

Section II

Working Relationships:

List below the titles of people or groups inside our outside the organization that

you regularly contact as part of your job. Do not include your supervisor and

employees you may supervise.

Working Conditions:

Describe any dangerous conditions, usual physical demands, and/or

unpleasant working conditions connected with your job and how these affect

you.

Physical Requirements:

Indicate any physical requirements of the job, such as significant and unusual

walking, lifting, climbing, bending, kneeling, stooping, crawling, reaching,

handling, standing, pushing, and pulling. (Specify lbs. lifted.)

Machines, Hardware/Software Tools, etc.:

Machines, Hardware/Software Tools, chemicals and Equipment Used: List

types or names and indicate percent of time spent on each. Percent needs to

not total 100. Identify the items for which you are assigned maintenance

responsibility.

What is the most complex part of your job?

Effective coordination of all responsibilities in order to provide most effective

service for students

Regular Dealings With: Frequency: Purpose

Faculty Weekly Communication and coordination of

educational support for students

Staff Weekly Communication and coordination of

educational support for students

Students Daily Instruction and other academic

support

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Sample Position Description

Instructional Associate

Impact:

Describe how the work you do helps your organization (division, department,

etc.). In what ways can your work performance improve operation, for example,

increase effectiveness of services, reduce or control costs, or prevent losses?

The services provided by the MAPEL Center are critical for the academic

success of students studying math, accounting, physics or engineering at

Montgomery College. The MAPEL Center provides these students with one-

on-one academic assistance almost any time of the day. Students may drop

in and receive help or make an appointment. The Center provides these

students with free tutoring from highly qualified and trained student tutors, full

and part-time staff, and math, physics and engineering faculty. The MAPEL

Center services are accessible - particularly for those Montgomery College

students who hold jobs. The MAPEL Center is open from 9 am - 9 pm

Mondays to Thursdays; from 9 am - 5 pm Fridays and Saturdays, and from

11 a.m. - 2 p.m. on Sundays, creating ample opportunities for students to

receive one-on-one tutoring. There is not fixed time limit to how much time

students can work with a tutor; our tutors are available based on overall

Center demand. Not only students from Germantown, but also students from

Rockville and Takoma Park come to use our services. In addition to providing

one-on-one tutoring we provide space and resources for study groups and

individual studying.

What kind of errors or mistakes can occur in your position?

Miscommunication with students could result in conceptual

misunderstandings.

What are the probably results of such errors or mistakes?

Student conceptual misunderstandings and/or unpleasant experience.

How are such errors or mistakes prevented or corrected (e.g., review by

supervisor)? Are there written guidelines or rules you are required to follow in

these areas?

Initial and ongoing tutor training and regular communication with supervisor.

Section III

Qualifications: Minimum Education

Indicate the level of education that a person would be expected to have in order

to qualify for the position (that is, performance on the first day of work). This

education can be acquired through home study, special courses or in ways

other than the usual academic process. The level required, however, should be

expressed in terms of years of academic study and degree in order to provide a

uniform basis for analysis. (If education beyond the minimum required is

considered desirable but not essential, enter the additional amount but indicate

that is not part of the basic requirement).

Bachelor’s degree in mathematics, physics, engineering or related field

(Master’s preferred). Some educational background in accounting or

business preferred.

Qualifications: Specialized Training

Identify required special courses during formal education, as well as through

additional specialized training, that are considered essential to qualify for the

position. Also identify any special licenses (operator, chauffeur, and so forth) or

certificates required.

Qualifications: Minimum Work Experience

Identify the occupations or fields of specialization in which experience, if any, is

needed in order to qualify an individual for the position. Also enter the minimum

desirable amount of such experience, expressed in years.

Kind of Experience: Number of Years:

Teaching/tutorial experience desirable 3

Qualifications: Required Knowledge, Skills, & Abilities:

Please specify any minimum KSAs required (e.g., ability to communicate orally

and verbally, etc.).

Additional Information:

Supervisory Responsibility:

If the following list is inaccurate or if you supervise temporary employees,

trainees, student aides, or volunteers, please write your clarifications and

additions in the Other Supervisory Responsibilities text box.

Oher Supervisory Responsibility:

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Job Evaluation

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Overview

!  What Is Job Evaluation?

!  Market Context for Job Evaluation

!  Job Evaluation Alternatives

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What Is Job Evaluation?

… the PROCESS of determining the RELATIVE RELATIONSHIP OR VALUE of jobs or work within the

organization

Why Job Evaluation?

!  Understand the internal value and external (market) value of positions

!  Ensure jobs are aligned appropriately within the College’s salary structure

!  Ensure equitable pay for jobs

Internal Focus External Focus

Decision-Making Criteria

!  Responsibility/Impact

!  Managerial Scope

!  Knowledge/Skills

!  Job Complexity

!  Market Data

!  Availability of Talent

!  Local Market Influences

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Considerations for Selecting a Job Evaluation Method

!  Organization culture

!  Internal vs. external focus

!  Availability of market data

!  Types of jobs (i.e., technical, support, professional)

!  Resources for administration

!  Ease of communication

!  Defensibility needs

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What’s Happening in the Market

Current Practices in Job Evaluation

!  Starting in the mid-1980’s, U.S. companies moved away from internally focused job evaluation

systems to externally focused market pricing systems

–  Higher education has been slower to move toward an externally focused job evaluation approach

!  The shift from an internally focused to externally focused job evaluation systems has occurred due to:

–  Rapid evolution of technology and high rates of mergers, acquisitions, and spin-offs made it

difficult to maintain current evaluations of ever-changing configurations of work

–  The rise of the “knowledge worker” made the hierarchical logic of traditional job evaluation less

relevant … “person-based” versus “job-based” pay became popular

–  Rapid changes in demand for “hot jobs” made internal value of work less important than market

pay rates

–  Downsizing and decentralization of HR staff made labor-intensive approaches to job evaluation a

challenge

–  A general trend toward managerial empowerment and self-service in HR decision-making

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Alternative Approaches to Job Evaluation

Market Pricing

Ranking to Market

Job Slotting/

Classification

Factor Comparison/

Paired Comparison

Point Factor

Externally

Focused

Internally

Focused

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Montgomery College’s Approach to Job Evaluation

!  Implement a market-based job evaluation system that will:

–  Enable the College to retain and attract talent

–  Align base pay to the external market more directly

–  Allow for ease of administration

–  Be fiscally responsible

–  Provide opportunities for clear and concise understanding

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Market Pricing

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Market Pricing Process

Identify

Survey

Sources

Identify

Benchmark

Jobs

Identify

Survey

Scopes

Collect and

Update

Market Data

Determine

the

Estimated

Market

Value

!  Market pricing is the process of establishing an external competitive market for jobs or skill sets that

are comparable to those within the organization

!  Jobs with a match in the market are called benchmark jobs

!  Market pricing an organization's individual jobs is accomplished by the following steps:

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Step 1: Identify Survey Sources

Review sources for market pricing.

Type Advantages Disadvantages

Published !  Easy access

!  Minimal expenses

!  Good representation of jobs and companies

!  Sample size

!  Quick turnaround

!  Broad mix of companies

!  Difficult for unique or hot jobs

!  Little data on “skills”

!  Ability to keep up with market

!  Limited to “benchmarks” on easily definable jobs

Private !  Target companies

!  Key jobs

!  Better defined job description

!  As participant, may get free summary

!  Can be more expensive

!  May not be ongoing

Custom !  Target companies

!  Unique jobs

!  Ability to gather the data you want

!  More expensive

!  May not be ongoing

!  Getting companies to participate may be challenging

Recruiting

!  New hires

!  Head hunters/

search firms

!  “Fresh” data !  May not be based on content of job

!  Data may be skewed

!  Limited sample size

!  Always a “premium” for new hire

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Step 1: Identify Survey Sources

!  We recommend that published surveys contain the following to be included in the benchmark

process:

–  Job descriptions

–  Clear differentiation in level and function

–  Clearly defined data elements and methodology

–  Different cuts of data by scopes (industry size, geographic location)

–  Reliable list of participants that represents the market for talent

–  Timely results/current market trends

–  Future availability/consistent publication

–  Large sample size per job

–  Disclosed data effective date

–  Independent third party survey administration

–  Submissions from HR departments (e.g., not self-reported data)

!  Following these guidelines adds to the credibility of the results and supports ongoing maintenance

and updates to the market data

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Sample Survey Sources for Montgomery College

!  College and University Professional Association for Human Resources Surveys:

–  Administrators in Higher Education

–  Non-exempt in Higher Education

–  Professionals in Higher Education

!  Local Data

–  Montgomery County (Public Schools and Government)

–  Maryland Association of Community Colleges

–  Local Government Personnel Association

!  Aon Hewitt Surveys

–  Total Compensation Measurement (Executive and Management and Professional)

–  High Demand Information Technology Skills

–  Non-exempt

!  Mercer Surveys

–  Mercer Benchmark (i.e., Human Resources, Information Technology, Finance, Accounting and

Legal, Sales, Marketing and Communications, etc.)

!  Towers Watson Surveys

–  Supervisory and Middle Management

–  Technical and Operations

–  Office and Business Support

Note: Typically use 25-30 survey sources per market study.

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Step 2: Identify Benchmark Jobs

!  Benchmark jobs are common jobs found across most industries and organizations (i.e., accountant,

administrative assistant)

–  They typically cover a subset of jobs and allow an organization to collect market values reflective

of the overall pay system rather than depending upon finding appropriate data for every job in the

organization

!  Let’s benchmark all our jobs!

–  Even the best surveys will have gaps—not all jobs are able to be benchmarked accurately;

specifically, roles that are unique to the institution may not be comparable in the market

–  Market pricing jobs requires administrative time and cost, whether managing the work internally

or working with an external resource or consulting firm

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Step 2: Identify Benchmark Jobs

!  Considerations when selecting benchmark jobs:

–  Widespread and common usage both within your institution and in other companies

–  Multiple incumbents

–  Roles with a fairly uniform and stable definition

•  The goal is to have consistency in benchmark jobs from year-to-year

–  Positions that cover many or all of the institution’s job functions and families

–  High turnover jobs

–  Key or critical jobs

–  Jobs with limited talent available

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Step 2: Identify Benchmark Jobs

Job Matching Challenges

!  One of the greatest challenges HR personnel often face is the difficulty in getting precise job

comparisons

–  Survey job descriptions are broadly written

Consider this….

Accountant

Reconciles and

adjusts various

general ledger

accounts and/or

statements

Perfect Match !

Study’s Description Your Description

Accountant II

Reviews, maintains

and reconciles

accounts, making

adjustments,

corrections as

appropriate

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Step 2: Identify Benchmark Jobs

Consider this….

Safety and Security

Specialist

Manages partnerships

with community

leaders to educate

individuals on facility-

related safety issues

Not an Exact Match !

Study’s Description Your Description

Environmental

Health Specialist III

Performs complex

regulatory inspections

and investigations

and closes facilities

due to non-

compliance

Environmental

Safety Specialist

Conducts

environmental safety

inspections, evaluates

work place

environments, and

ensures prevention of

accidents

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Step 2: Identify Benchmark Jobs

!  When reviewing a benchmark job follow these guidelines

–  Compare the job’s responsibilities to those in the survey

•  Don’t rely on titles, match for content

•  Management titles may not align

•  Don’t rely solely on years of experience

–  General rule of thumb is 70% match

–  Generally, multiple survey matches per job are preferred

•  However, one solid match is better than several “almost” matches

–  Not all jobs are benchmarked in salary surveys

–  Jobs that exist at other Institutions and in the external market may not be benchmarked in salary

surveys

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Step 3: Identify Survey Scopes

!  Determine the scope to include for each benchmark based on your market for talent

–  From where do you hire employees?

–  Where do employees go when they leave?

!  Scope can reflect the organizational size, industry, individual responsibility, region and/or geography

depending on the job level and market for talent

Level

Scope/Size

(Budget, Enrollment, etc.)

Industry Geography

Executive

Director

Manager

Professional/

Technical

Support

Very Related

Somewhat

Minimally

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Step 3: Identify Survey Scopes

!  Select measures to be used as primary basis for comparison to market based on your institution’s

stated (or unstated) competitive positioning target

–  Percentiles—rank the data values in ascending order and calculate specific percentile values

•  50th percentile (median): Middle value of the data; one-half of the data is above this point

and one-half of the data is below this point

•  The median is less sensitive to outliers than the average

•  25th percentile: Value below which

25% of the data fall (1st Quartile)

•  75th percentile: Value below which

75% percent of the data fall

(3rd Quartile)

75%

25%

percentile

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Step 4: Collect and Update Market Data

!  Aging Survey Data

–  Since the effective dates of survey sources vary, all data should be updated to a common date

–  Determine annual aging factor (rate at which market rates are increasing)

•  Local, regional, national, industry surveys of past and projected salary and structure

movement

–  Determine date to which to age data

•  Date of pricing, effective date for salary structure, etc.

•  Lead, lag, or lead/lag philosophy

–  Modest aging factor of 3.0% annually in recent years

!  Multiple sources of data

–  Robust sample sizes

•  Consider this in industry and/or geographic cuts

–  Data trends/outliers

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Step 4: Collect and Update Market Data

Multiple Sources of Data—Example

Survey

Source

Survey

Scope

Survey Position Title and

Industry Classifications

Number Orgs Reported

Incumbents

Median Base

Salary (‘000)

TCM All Reported Senior HR Executive—

Global Leading Companies

40 110 $126.7

ABC All Reported HR Executive Level 4—All

Industries

540 2,850 139.4

Private 1 All Reported HR Executive Level 3—All

Industries

10 36 119.8

Private 2 All Reported Senior HR Officer—All

Industries

3 9 162.3

KLM New York Senior HR Associate—

Nondurable Manufacturing

15 41 86.7

Too small sample size

Too low compared to other

data, likely not comparable

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Step 5: Determine Estimated Market Value

!  Average the results from multiple data sources for an overall estimated market value

–  Weight across the survey sources

!  Adjusting data (e.g., discounts and premiums)

–  Generally not recommended, but appropriate in some circumstances

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Step 5: Determine Estimated Market Value

!  As a general rule

–  Salary information is considered to be competitive with the marketplace within plus or minus 10%

–  Salary levels more than 10% above or below the market should be researched; reasons for

higher variations include:

•  Job tenure—the length of time incumbents have been in a job

•  Variation in responsibility—difference in the responsibility levels of jobs matched to the

survey job

•  Pay for this role is above or below market levels

•  Benchmark match—the survey match is at a higher or lower level than originally matched

#  A word of caution: Do not match jobs based on the incumbent in the role or the pay level

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Step 5: Determine Estimated Market Value (Sample Only – False Data)

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Structure Development

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Salary Structure Framework

Purpose and Trends

!  A well designed salary structure will serve several purposes:

–  Provides a framework for organizing and grouping jobs

–  Provides an understanding of how jobs fit together and how to advance in career

–  Gives managers the flexibility to reward performance, skill development, and critical skills needed

by the organization but with some boundaries (guidelines versus rules)

–  Supports and enables the development of a “pay for performance” philosophy

•  In contrast, poorly designed salary structures inhibit properly rewarding performance or skill

development and may be used as a scapegoat by managers to explain why they could not

adequately reward performance or reflect increased responsibility

–  Helps to effectively control overall base salary costs while accurately reflecting the competitive

market values of jobs in the grade

–  Reflects meaningful career progressions through movement from grade to grade

–  Communicates how much the organization is willing to pay each job, and establishes a standard

guideline for managing pay within the organization

!  Some of the current trends regarding salary structure designs are as follows:

–  Fewer structures and grades—moving away from traditional salary grades

–  Using a “fanned” approach has gained popularity as it allows for increased flexibility

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Key Structure Design Elements

!  Midpoint

–  Represents value of job once the incumbent is fully competent in the role or consistently performs

all expected job responsibilities and duties

!  Range Spread

–  Spread from the minimum to maximum

–  Typically larger range spread at the higher levels of the organizations

•  Employees tend to stay in position longer

•  Wider range spread allows for growth above market, i.e., experience and knowledge

becomes more reflective

!  Job Placement by level using one or a combination of the following processes

–  Market Pricing

–  Whole Job Slotting

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Montgomery College’s Current Salary Structure Framework

!  Currently have one salary schedule for

Administrative, Associate, and Support

Staff

!  Structure characteristics

–  Includes 19 grades

–  Consistent range spread (70%)

across all grades

–  Inconsistent midpoint differentials

ranging from 6% to 10%

•  Midpoint differentials are lower

(6%) at the top and bottom

•  Largest differential (10%)

exists in the middle, grades I

through L

!  Job evaluation approach is primarily

internally focused versus market based

–  Risk of jobs being misaligned to the

market with the current approach

–  Impacts attraction and retention

Montgomery College Salary Schedule

FY17 (Effective 7/1/16)

HOURLY RATE ANNUAL RATE*

ANNUAL RATE*

Grade Min

Mid

Max Min

Mid

Max

A $14.35 $19.45 $24.54 $29,848.00 $40,456.00 $51,043.20

B $15.22 $20.62 $26.02 $31,657.60 $42,889.60 $54,121.60

C $16.12 $21.85 $27.57 $33,529.60 $45,448.00 $57,345.60

D $17.10 $23.16 $29.22 $35,568.00 $48,172.80 $60,777.60

E $18.46 $25.00 $31.54 $38,396.80 $52,000.00 $65,603.20

F $19.95 $27.00 $34.04 $41,496.00 $56,160.00 $70,803.20

G $21.55 $29.16 $36.77 $44,824.00 $60,652.80 $76,481.60

H $23.26 $31.48 $39.70 $48,380.80 $65,478.40 $82,576.00

I $25.60 $34.63 $43.65 $53,248.00 $72,030.40 $90,792.00

J $28.16 $38.09 $48.01 $58,572.80 $79,227.20 $99,860.80

K $30.97 $41.88 $52.78 $64,417.60 $87,110.40 $109,782.40

$34.06 $46.05 $58.04 $70,844.80 $95,784.00 $120,723.20

$36.79 $49.74 $62.69 $76,523.20 $103,459.20 $130,395.20

$39.74 $53.72 $67.69 $82,659.20 $111,737.60 $140,795.20

$42.91 $58.05 $73.19 $89,252.80 $120,744.00 $152,235.20

$46.34 $62.64 $78.93 $96,387.20 $130,291.20 $164,174.40

$49.13 $66.39 $83.65 $102,190.40 $138,091.20 $173,992.00

$52.09 $70.38 $88.66 $108,347.20 $146,390.40 $184,412.80

$55.20 $74.58 $93.96 $114,816.00 $155,126.40 $195,436.80

*ANNUAL EQUIVALENT RATE FOR FULL-TIME, 12-MONTH EMPLOYEES

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Internal Focus External Focus

Decision-Making Criteria

!  Responsibility/Impact

!  Managerial Scope

!  Knowledge/Skills

!  Job Complexity

!  Market Data

!  Availability of Talent

!  Local Market Influences

Getting Started

Placing Jobs Within the Salary Structure Framework

!  In 2014, over 100 jobs were market priced. Today, we are in the process of market pricing over 180

jobs which represents approximately 50% of Montgomery College’s jobs and represents best

practices.

!  Benchmark jobs will be initially slotted into the new salary structure based on their market values

!  The remaining jobs will be placed in the salary structure using whole job slotting methodology

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Appropriate Internal Considerations When Aligning Jobs to the Structure

To align non-benchmark jobs to the structure using the whole job slotting job evaluation methodology,

the following are appropriate internal considerations:

!  Responsibility/impact of the job on a department

–  What are specific duties and responsibilities of the job?

–  What operating/customer service/financial results does the job directly or indirectly impact?

–  Which standards of operation/work practices, if any, are determined by the job?

–  When do staff in the job seek guidance from higher level workers or supervision?

!  Supervisory scope of the job

–  What are the supervisory elements of the job, if any?

–  Are the direct reports supervisory or non-supervisory?

–  Does the job have sole responsibility for supervising a department or work group?

–  Is the job a “working supervisor,” that is, doing the same or similar work to those being

supervised?

!  Knowledge and skills required and level of complexity

–  How are the skills for the job typically attained and how long does it take (i.e., prescribed course

work, on the job training, specific degree?)

–  How does the required skill/complexity level compare to other jobs in its family?

–  Does the job require specialized or technical knowledge or expertise?

–  What is the nature of interactions required by the job?

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Appropriate Internal Considerations When Aligning Jobs to the Structure

!  Career path progression (reporting relationships)

–  Does the job have significantly more independence and/or supervision than other jobs in the

same family which require the same types of skill sets?

–  What are the reporting relationships?

–  What are potential next jobs into which this job might progress?

!  May Also Consider Recruiting and Retention Challenges

–  For particularly market-sensitive jobs, some additional factors may need to be considered:

•  Are there issues around recruiting and retaining qualified candidates with this unique skill

set?

•  Have you recently experienced voluntary turnover attributed to the current pay level for this

job?

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Impact Analysis

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Conduct Impact Analysis and Develop Implementation Strategy

!  Once jobs are assigned to the salary structure, an impact analysis needs to be conducted

!  An impact analysis determines the financial cost of implementing the recommended salary

structure(s) and includes a review of the following:

–  Number of employees below the minimum of the salary grade

–  Number of employees above the maximum of the salary grade

–  Market position of employees

!  Develop implementation strategy

–  Timeline for implementation (i.e., immediate or multi-year approach)

–  Pay practices related to implementation (i.e., red circling, bring to minimum)

–  Pay positioning

–  Ongoing pay administration

•  Promotions

•  Internal transfers

•  New hires

•  Market adjustments

•  Special recognition

•  Lump Sums

•  Spot bonuses

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Review of Learning Objectives

The learning objectives for the Compensation 101 course are as follows:

!  Explain Montgomery College’s Compensation Philosophy

!  Describe the importance of accurate and thorough job documentation

!  Describe the various approaches of determining the value of a job balancing its internal value

with its external value

!  Define market pricing and discuss the processes taken to market price a job

!  Describe the importance of a salary structure, its purpose and trends in the marketplace

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Next Steps

Develop

Interim Plan

Comp 101

Comp Design

Comp Admin

Prepare for

Implementation

! Adjust

Communication

Plan

! Determine if

interim pay

increase

strategy is

feasible for

FY17

! Develop Interim

Pay Policies

! Implement

program

! Conduct

ongoing

communication

and follow up

! Provide

additional

training as

identified

! Evaluate

program

effectiveness

! Develop and

refine policies

! Develop

compensation

administration

guide

! Evaluate jobs

! Review/refine

structure design

! Refine job

assignments

! Conduct cost

impact analysis

! Develop Comp

101 Training

! Deliver training

to leaders

! Linkage to pay

for performance

FY19FY18

FY17

! Gain program

Approval (BOT,

SALT)

! Develop

communication

and training

strategy

! Develop

communication

and training

material

! Deliver

communication

! Conduct

training

! Systems

updates

**(Labor Relations

Reopeners)**

Ongoing Communication & Updates SALT Governance Councils Finance/Budget Labor Relations Employees

Ongoing Communication:

!  Regular updates and

consultation with leadership,

governance councils, and

other key stakeholders

!  FAQs are posted on the

Classification and

Compensation website and

will be updated regularly

!  The email address

(

CompProgramQuestions@

montgomerycollege.edu)

continues to be available to

receive questions and

comments

FY 2017 Project Activities

!  Review/refine structure

design

!  Refine job assignments

within the structure

!  Conduct cost impact

analysis

!  Develop and refine policies