Vantage Point: Staff salary program linked to individual performance
Diane Peck
BY DIANE PECK
In their memorandum to the deans, vice presidents and vice provosts dated March 19, Provost John Etchemendy and Randy Livingston, vice president for business affairs and chief financial officer, announced that there will be a staff salary program for the 2005 fiscal year, effective Sept. 1, 2004. I join them in thanking all members of the Stanford staff for their contributions during a very challenging year.
The staff salary program is a cornerstone of Stanford's performance management process, which is grounded in ongoing, two-way communication between each employee and his/her supervisor about job expectations and how those expectations are being achieved. An effective performance management process is key to achieving a high-performing and positive work environment where managers provide the motivation and encouragement that is needed to retain employees, as well as honest feedback and coaching to help employees who are not meeting performance expectations.
With the reintroduction of funding for base-salary increases, it is important to reemphasize the link between performance and compensation. Stanford's pay-for-performance philosophy calls for substantial differentiation in merit awards; that is, employees whose contributions are significant should receive monetary rewards proportionately greater than those awarded to employees who contribute to a lesser degree. Employees performing at unsatisfactory levels do not receive merit increases.
To further reinforce the link between performance and compensation, we encourage the use of variable-pay programs (bonus or incentive plans). These programs give units additional flexibility to acknowledge employees who achieve their goals and objectives, to reward their best performing employees and to recognize staff who make special contributions. Looking ahead, we anticipate an increasing emphasis on variable pay as a percentage of our total compensation package.
An equally important element of any salary program is appropriate periodic review of pay ranges. According to Linda Lee, Stanford's director of compensation, all staff pay ranges are being adjusted upward effective Sept. 1, 2004. Updating salary ranges offers employees whose performance meets or exceeds expectations a greater opportunity to increase their pay over time. Based on market data Lee's staff collect from a number of diverse and specialized salary surveys covering local and regional areas, we know that Stanford pay ranges continue to be in line with the current marketplace. Lee says market data also indicate that -- due in part to the pervasive nature of the recent economic downturn -- the university's one-year freeze on base-salary increases did not damage our overall standing compared to our competitors in the Bay Area.
While a sound salary program is an essential element in fostering a positive employment environment, we should not forget the importance of other aspects of the employment relationship, such as a competitive benefits program, career development opportunities and work/life programs, to name a few, all of which help provide a rewarding and fulfilling work experience. Many factors contribute to making the Stanford work experience second to none -- exciting employment opportunities, an excellent work environment, a culture of commitment and caring, a sense of community and the opportunity to be associated with an organization that is contributing so much to improving the world.
All departments are currently preparing salary increase proposals for their staff employees for fiscal 2005. Deadline for performance reviews and resulting salary decisions vary from unit to unit within the university, but most planning activity will be completed by mid- June, with many increases effective Sept. 1, 2004 -- the beginning of the new fiscal year. Timing for when individual employees will be informed of final decisions regarding their pay varies since each school or vice presidential area is given a great deal of freedom to administer and communicate its staff salary program within university guidelines. Â
Please note that the staff salary program for fiscal 2005 applies to exempt staff and nonexempt non-bargaining unit staff.
*Technical, maintenance and service workers should refer to Stanford's Sept. 1, 2003, agreement (in effect through August 2006) with United Stanford Workers for guidelines and pay tables.
*Deputized patrol officers and community service officers should refer to the Stanford Deputy Sheriffs' Association Agreement effective Aug. 1, 2001, through July 31, 2004, for guidelines and rates of pay.
If you have questions regarding the staff salary program, contact your supervisor or your human resources officer. Information regarding compensation policy and programs at Stanford is available online at http://hrweb.stanford.edu/compensation .
Diane Peck is executive director of human resources.
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