The ABCs of XYZ Monica GudeaDirector, Faculty Affairs & CompensationApril 26, 2018

Health Sciences Compensation Plan

Department Compensation Plans

The ABCs of XYZ

Covered Compensation

Academic Programmatic Units (APUs)

Health Sciences Faculty Salary Scales

UC/VA Split Appointments

Resources

Agenda

• Mandated by the UC Office of the President (UCOP)

• The HSCP - formally known as APM 670 - informally “the comp plan”http://www.ucop.edu/acadpersonnel/apm/apm-670.pdf

• First implemented in July 2002, revised July 2012

• VCHS has implementation guidelines, departments provide the details

• 2013 UC San Diego HSCP Implementation Guidelines on the VCHS Faculty Compensation website: https://healthsciences.ucsd.edu/vchs/faculty-academics/academic-affairs/faculty-compensation

Health Sciences Compensation Plan (HSCP)

• Each department has Department Compensation Plan Procedures

• All faculty should review terms and conditions

• Department Compensation Plans cover:

Department Compensation Plans

– Good Standing Criteria– Faculty compensation – Salary sources– Outside professional activities

– Academic Programmatic Units (APUs)– FTE salary savings– Leaves of absence– Bonus plan participation

• Check with department business officer for department specific questions

• Participation is mandatory for faculty with• an appointment > 50% • a salaried professorial series

Adjunct, Clinical X, HS Clinical, In Residence, Ladder Rank

• Faculty participating in the HSCP:• Receive base salary • Eligible for optional university additional compensation • Permitted to retain other miscellaneous income• Entitled to leave benefits (paid and unpaid)

• Non faculty academics not eligible for HSCP membership• post-docs, project scientists, research scientists, specialists,

academic coordinators/administrators

HSCP - Membership

“The salary structure at UCSD is based on X, X’, Y’, Y, and Z components, where X represents the base salary of the academic rate for the University of California. All of your salary will be supported by non-State funds (for example: clinical income, teaching and/or contracts and grants). You may have an opportunity to earn incentive (Z) pay in addition to your annual salary, based upon your ability to reach performance targets mutually agreed upon by the Department. Please note that Y and Z pay components are not recognized in the University’s retirement benefit calculations. Each year faculty meet with their Division Chief and/or Department Chair to negotiate salaries for the next fiscal year, which presents an opportunity to discuss an increase in salary.”

A Confusing Introduction to XYZ – The Proposal Letter

X + X’ + Y’ + Y + Z =

The ABCs of XYZ

Base Pay

IncentivePay

Total Negotiated Salary

Covered Comp

NegotiatedComponent

Salary Structure

• X, X’, Y’ = covered compensation• Y, Z = uncovered compensation

Why is “covered compensation” important?• Used for retirement calculations (up to the amount permissible under

Internal Revenue Code provisions & UCRP policy) • Per IRC 401(a)(17) – for 2018, the earnings limit is $275,000. For those who

were active members before 7/1/93, earnings limit for 2017 is $405,000 • Highest Average Plan Compensation (HAPC) = the average full-time

compensation over an employee’s 36 highest continuous months of pay

• Used for benefits calculations• UC life insurance• UC disability insurance

Covered Compensation

APU Scale Base Multiplier0 1.01 1.12 1.23 1.34 1.45 1.56 1.77 1.88 2.09 2.3

• All HSCP faculty are assigned to an APU based on academic / programmatic focus

• Defined by responsibilities: teaching, research, clinical, and/or administrative

• The APU determines the covered compensation / salary scale for the members

• Placement on the scale is determined by characteristics of the group (e.g. type of activity, potential for income)

Academic Programmatic Units (APUs)

APU Base Multiplier * Base Salary = Covered Compensation

Health Sciences Faculty Salary Scales

Off scale: Covered compensation falls between the steps

Above scale: distinguished professors who have advanced past step IX

• A group of 5 or more faculty members whose activities are programmatically similar

• All members of the APU must be able to sustain the scale pay assigned

• Cannot discriminate based on age or funding

• No individual faculty member may be moved from one APU to another without a significant change in duties or a change in department

• Faculty should never be placed in an APU solely to boost retirement pay

• Entire APU rises or falls in scale pay together

• No APU scale pay changes mid-year

• SOM has over 100 APUs – creation of new APUs is frozen

Academic Programmatic Units (APUs)

The ABCs of XYZ Total covered compensation

X + X’ + Y’ + Y + Z = Total Income

Total negotiated salary

XBase salary • Determined by rank & step • Listed on offer letters, merit/promotion letters• Recognized for retirement – covered compensation

X’ & Y’Additional covered compensation• Determined by APU • Amount of covered compensation above X base salary• Recognized for retirement – covered compensation

Y

Additional negotiated compensation• Based upon the availability of funds• Negotiated & guaranteed annually • No cap• Not recognized for retirement

ZIncentive/bonus• Not guaranteed, not recognized for retirement• Based on productivity standards and revenue generated from consulting,

clinical productivity, outside professional activity

John Smith, MD

• Associate Professor in Residence, Step 2• Clinical Dermatologist = APU/Scale 3• Total negotiated annual salary of $134,000• Additional $10,000/year serving as department residency director

Faculty Salary Components Example

$91,700 [ X ] (X base salary for associate professor step 2, covered compensation)

$27,600 [ X’ ] (Scale 3, expansion of base salary, covered compensation)$119,300 = Total Covered Compensation

+ $14,700 [ Y ] (Negotiated salary, not included in covered compensation)$134,000 = Total Negotiated Annual Salary

+ $10,000 [ Z ] (Administrative incentive - department residency director)

$144,000 = Total Income

Total covered compensation

X + X’ + Y’ + Y + Z = Total Income

Total negotiated salary

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Sample Faculty Paycheck

Additional Pay types for Agency/NIH Cap & Cap Gap:X: A C X/BS/REG, B/A-X/BSE AS X’: B/A-XP/BS AS, C X/BASE PRI Y’:A C/Y-PRM, HSDIFF-BYA Y: B/A-YDIF AS, Y/DIFF A CAP

Total negotiated salary (monthly)

15

• VA & UC San Diego are separate legal entities and “pay masters”

• UC San Diego faculty working at the VA are paid through the VA payroll system for their VA compensation

• VA provides benefits based upon eligibility for time worked at VA only

• VA employees work 8ths and UCSD employees work a % time• 8/8ths at the VA = 100% time• 4/8ths at the VA = 50% time

• For information about VA compensation, contact VA Human Resources

UC/VA Split Appointments

• The maximum allowable appointment at UC is based on a 60 hour work week of combined hours at both UC & VA

• VA considers full-time to be 40 hours per week (8/8ths)

• UC considers full-time to be 40 hours per week (100%)

• Maximum allowable appointment:

8/8ths at VA = 40 hours 5/8ths at VA = 25 hours50% at UC = 20 hours 87% at UC = 35 hoursTotal 60 hours Total 60 hours

UC/VA Split Appointments

UC/VA Split Appointments

Note: Faculty are not guaranteed the maximum appointment percentage. UC appointment percentage is dependent on the amount of UC pay as a percent of X.

• Health Sciences Faculty Compensation Website:https://healthsciences.ucsd.edu/vchs/faculty-academics/academic-affairs/faculty-compensation/pages/default.aspx

• Academic Personnel Manual (APM):http://www.ucop.edu/acadpersonnel/apm/welcome.html

• University of California Benefits Website:http://ucnet.universityofcalifornia.edu/

• UC Retirement Administration Service Center (RASC) Website:http://atyourservice.ucop.edu/directories_contacts/customer_service.html

• Compensation experts:Monica Gudea (monica@ucsd.edu), Han Ho (h3ho@ucsd.edu), Angelica Mangindin (amangindin@ucsd.edu) & ARC-CT Staff (ARCrequest@ucsd.edu)

Resources for Additional Information