proposed changes to gov. bill haslam's plan to end longevity pay

Compensation Enhancement Act

Presented by the Department of Human Resources

Commissioner Rebecca Hunter

T.E.A.M. Act of 2012 Key Components

Hiring practices

Reductions in force

Employee appeals

Performance management

Merit pay

Learning & development

Background

Previously, there was little focus on performance as a

whole

Employee performance evaluations were not equitable

Most employees received a 4 for outstanding

or a 5 for exceptional

Supervisors and employees did not take the evaluation

process seriously

Background

T.E.A.M. Act began to place emphasis on performance

Act allowed for merit pay to recognize above average

performance

Individual performance plans were required to be SMART

Specific, Measurable, Achievable, Relevant and Time Sensitive

Began changing the culture to focus on performance as a

journey, not an event

S.M.A.R.T. Formula Planning Tools

Specific Measurable Achievable Relevant Time Sensitive Work outcomes should

specify what they need to

achieve.

The work outcomes need

to be able to be measured

as to whether or not they

have been met.

The work outcomes must

be able to be met with

the resources available.

The work outcomes are

important to the agencys

goals and the specific job

function.

The work outcomes need

to have a time limit for

completion.

Specific means the work

outcome is concrete,

detailed, focused and well

defined. It must be

straightforward and

emphasize action and the

required outcome. The work

outcome must communicate

what you want to see happen.

A work outcome must be

measurable so that its

progress can be assessed.

Its important to have

measures that will

encourage and motivate

and will allow one to

determine whether or

not the work outcome

has been achieved.

The work outcome must

be capable of being

accomplished based on

the skills, knowledge and

resources available. The

work outcome can be

challenging, but not so

much so as to cause

frustration.


relate to the overall

agency goal and the

specific job class.


have a begin date and an

end date. Interim dates

for assessment may also

be included. Agreed

timeframes create the

necessary urgency and

prompt action.

What exactly is to be done,

with and for whom?

What strategies will be used?

Is the work outcome well

understood?

Is the work outcome

described with action verbs?

Is it clear who is involved?

Is it clear where this will

happen?

Is it clear what needs to

happen?

Is the outcome clear?

Will this work outcome lead

to the desired results?

How will it be known that

the work outcome has

been achieved?

Is there a reliable system

in place to measure

progress towards the

achievement of the work

outcome?

How much?

How many?

Can the work outcome be

met within the proposed

timeframe?

Are the limitations and

constraints understood?

Can the work outcome be

met with the available

resources?

Is the work outcome

possible?

Can the people with

whom the work outcome

is set make an impact on

the situation?

Do those tasked with the

work outcome have the

necessary knowledge,

authority and skill to

accomplish the work

outcome ?

Will this work outcome

help the agency reach its

strategic and/or

operational goals?

Is the start and finish

date/time for the work

outcome clearly set?

Is the set date/time

within the capacity of

those to whom the work

outcome is assigned?

Is the date/time for

accomplishment

reasonable?

The Performance Journey

Required SMART training for all supervisors & managers

Focused on performance coaching, not just single event

driven deadlines

Changed the Performance Management Program to

require a reviewer to approve the performance plan,

interim review discussions, and the final evaluation

Justification for Outstanding or Unacceptable ratings must

be submitted to the Appointing Authority for approval


Rating Scale Definitions Outstanding Performance Work outcomes consistently exceed

expected performance and affect

measurable improvements in

organizational performance

Advanced Performance Work outcomes consistently meet and

often exceed stated expected

performance

Valued Performance Work outcomes consistently meet stated

expected performance

Marginal Performance Work outcomes consistently do not meet

some stated expectations

Unacceptable Performance Unsatisfactory work outcomes


Research indicates that moving to a successful pay for

performance model should occur in phases:

Year 1 Give employees line-of-sight to performance goals

and reinforce timing and importance of discussions.

Year 2 Monitor goals and reiterate importance of

performance.


Completed 2 full performance annual evaluation cycles

DOHR continues to randomly audit performance plans to

ensure compliance with SMART principles

DOHR is launching a new curriculum called Get

S.M.A.R.T.er, which will be mandatory for all

supervisors

Market and Performance Based

Compensation Philosophy

Compensates employees based on performance

Continues to move salaries toward market value

Market and Performance Based Pay

Four Phases:

Repurpose Longevity

Implement Performance Based Pay

Increase Salary Ranges

Adjust Salaries Toward Market

Repurpose Longevity

Continues administrations focus on recruiting, retaining

and rewarding a talented workforce

Recognizes that experience is a component of a talented

workforce

Supports maintaining a competitive salary structure and

sustainable market and performance based compensation

philosophy

Repurpose Longevity

The employee will receive a permanent increase to base

salary equal to the longevity payment due to the employee as

of that date.

For example, Employee A will have worked for the state for 10

years. Employee A will receive a permanent salary increase of

$1000.

The recommended effective date of this increase would be

July 2015.

Applicability

The legislation would also not apply to non-executive

branches:

Legislative Branch

Fiscal Review

Judicial Branch

Administrative Offices of the Court

Secretary of State

Treasurers Office

Comptrollers Office

Office of the Attorney General

Higher Education

Applicability: Does Not Apply to

Statutorily mandated

salaries:

Exempt from the

T.E.A.M. Act:

Tennessee

Highway Patrol

Law Enforcement

Training Academy

Commissioned

Officers

Wildlife Officers

Certified

Teachers (DOC,

DCS, DHS,

Special Schools)

TRICOR

THDA

THEC

TACIR

Performance Based Pay

Awards employee performance

Improves efficiency

Encourages participation in programs that will improve job

performance and skills


Apply increase based on performance rating:

Outstanding 4%

Advanced 3%

Valued 2%

Marginal Not eligible for performance increase

Unacceptable Not eligible for performance increase


Based on ratings from 2014-15 cycle, which ends

September 30, 2015

Must have completed one full year of service to be eligible

Supervisors who do not timely complete the plans for their

employees are not eligible for performance based bonus

Performance payment will be made in January 2016

Increase Salary Ranges

Shift all ranges up 1%

Adjust individual salaries as needed to get employees

to new minimum

Effective January 2016

Adjust Salaries Toward Market

Apply increase based on position in the range, i.e. move employee

closer to market

Will depend on amount of dollars left after implementation of

performance based salary adjustments

Following chart is for illustration purposes only:

Position in Range 80-89 90-99 100+ (Market)

% Increase 1% .05% 0

What This Means For Employees

Based on previous performance evaluation cycles, trend

data reveals that 98% of eligible employees will see a

performance based payment.

Any dollars remaining after funding performance based

payments will be used to continue to move employees

toward market.

What This Means for Employees - Example

Average salary with longevity = $43,000

Average salary without longevity = $42,000

Average longevity pay = $1,100

Average performance evaluation rating = Valued


Phase 1

Apply the employees current longevity to the

employees annual salary

Starting salary = $42,000

Add longevity to the base salary = $1,100

New base salary = $43,100

Adjustment would occur in July 2015


Phase 2

Apply performance based payment based on performance evaluation rating

Valued = 2%

Advanced = 3%

Outstanding = 4%

Performance based payment based on a valued rating

43,100 x 2% = $862

New salary is $43,962

Payment would occur in January 2016


Phase 3

Adjust salary ranges 1% to allow structure to

remain competitive with market

New salary range minimum is $44,400

Adjust employees salary to $44,400 ($438 increase)

Salary adjustment would occur in January 2016


Phase 4

Apply market adjustment

Apply estimate of 1% to move individual salary closer to

market

$444 adjustment

Adjusted salary is $44,844

Salary adjustment would occur in January 2016


Starting salary with longevity was $43,000

Salary under Compensation Enhancement Act = $ 44,844

Increase of $1,844

Questions and Feedback

proposed changes to gov. bill haslam's plan to end longevity pay

Documents