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Appropriate use of other pay actions

 

Lateral transfer
A lateral transfer occurs when an employee transfers from one university department to another into the same job title. A lateral transfer may be competitive or noncompetitive. Non-competitive lateral transfers are typically initiated by management, in consultation with the HR Professional. The manager determines the new salary based on the individual’s qualifications and experience and associated salary range of the new job. Based on the results of that analysis, the salary of a transferring employee may increase, decrease or remain the same.

Demotion
When an employee moves into a job having a lower salary range midpoint than the previous job, the action is considered a demotion. Demotions may be voluntary or involuntary, competitive or noncompetitive. Demotions may include movement to the same level in a different job or to a higher or lower level with a lower salary range midpoint . Level placement for involuntary demotions are determined based on individual circumstances and the  needs of the school/unit. 

Example 1: A job change from Administrative Coordinator 1 to Administrative Assistant 1 would be considered a demotion.

Example 2: A job change from Administrative Coordinator I to Senior Administrative 

Assistant 2 would be considered a demotion.

Involuntary demotions
At the manager’s discretion, involuntary demotions occur when  job content changes or when an employee is unable to satisfactorily perform the essential functions of the position. Managers are charged with evaluating job content changes over time which may be the result of position changes, increased technological efficiencies, workforce reorganization, new skill requirements, etc. Employee performance is formally evaluated annually but is considered an ongoing process throughout the performance management process. 

  1. Job content related
    When a position is reassigned to a job title with a lower salary range midpoint, the employee’s salary and job level is analyzed to determine whether a salary reduction is appropriate. Demotions of this type are expected to include a reduction in pay based on the alignment of the job content to the university job structure, but are not mandated. VCU HR performs quality assurance reviews on the assignment of university job titles and retains the authority to change university job titles that are determined to be incorrectly assigned. 

  2. Incumbent performance related
    When demotions occur in response to employee performance, an employee’s salary is decreased. The manager, in consultation with HR,  determines the new salary. See additional information in the Steps of Progressive Discipline in the Employee Relations policy.

Voluntary demotions
Voluntary demotions can occur both competitively through the selection and hiring process or non-competitively through employee initiated requests.  

  1. Employee-initiated requests for voluntary demotion
    Employees may request a demotion. Managers have the discretion to approve or deny the request and determine the appropriate change in salary, if any.

  2. Through the competitive recruitment process
    Voluntary demotions occur competitively, when an employee applies and is selected for a position through the hiring process and the new  position has a lower salary range midpoint than their current job. The salary in the new market range is determined based on the qualifications and experience of the employee relative to the KSAs required for the job, in the same manner as a new hire salary determination. See Establish New Hire Pay above.

Temporary pay
When the need exists for an employee to take on additional responsibilities for a limited duration, managers may award temporary pay. Temporary pay can be either added to base salary or handled as non-base pay incentive, described further in the section below. The department head may choose the payout method.  If temporary pay is added to the base salary and received over a period of time, benefits are added to the base salary.  If temporary pay is paid as a lump sum, benefits are not paid on that amount and the lump sum is not counted against the bonus threshold for the year. Temporary pay added to the employee’s base salary results in no change to the employee’s position number and is not considered to be a promotion. For example, an employee who assumes the responsibilities of a vacant position may warrant temporary base pay increase, but the employee does not assume the duties of the vacant position on a permanent basis. The employee typically retains responsibility for the current job while assuming the additional duties of another position.

  1. Amount of temporary pay
    The percentage of temporary base pay increase is proportionate to the increase in responsibility. For example, if an employee assumes all duties of a vacant position, a higher percentage of temporary pay is considered than if an individual only assumes a portion of the responsibilities for the vacant job.

  2. Approval process
    All temporary pay actions require the approval of the appropriate vice president or dean in consultation with the HR Professional. If the requested new salary exceeds the 75th percentile of the employee’s current salary range, VCU HR review and approval is also required. The 75th percentile is determined based on the employee’s current level within the job series.    

  3. Duration
    Typically, temporary base pay is for six (6) months or less and does not continue beyond twelve (12) months.  However, in consultation with VCU HR, when extenuating circumstances exist, temporary pay may be extended with approval from the appropriate vice president or dean.

  4. Temporary pay effect on merit increase amount
    When calculating the amount of on-cycle merit increase, Temporary Pay should be excluded in the calculation to determine the new base salary.  

  5. Termination of temporary pay
    Upon termination of the temporary assignment, the employee’s base salary reverts to the former base salary plus any applicable on-cycle merit adjustments.

Non-base pay incentives
Monetary and non-monetary non-base pay incentives, also referred to as bonuses, may be awarded per fiscal year as follows: up to $5,000 or 10% of base pay (whichever is greater) and up to five days of leave granted per leave year. Sign-on bonuses and contractual bonuses are excluded from the fiscal year bonus thresholds, as are any annual merit bonuses.

Bonuses are intended to recognize employees for outstanding performance or contributions such as day-to-day support, customer service, or teamwork. Bonuses encourage excellence, create positive morale, and may lead to the retention of top employees. Schools/units should clearly communicate bonus programs/opportunities, and ensure equal opportunity in the design and implementation of bonus programs. Bonuses (or lump sum payments) are also an effective way to recognize employees who take on additional assignments on a temporary basis.

Virginia Commonwealth University
VCU Human Resources
Lindsey House | 600 West Franklin Street | Box 842511
Richmond, VA 23284-2511
Email: askhr@vcu.edu
Phone: (804) 828-0177

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