The Office of Compensation is responsible for advising managers in determining appropriate salary for new hires and current employees.
As a manager, you’ll be working with departmental/divisional leadership and possibly a human resources business partner to make pay decisions for the people who report directly to you. Pay decisions are based on an employee’s experience, education/special skills, and performance, as well as the employee’s pay history, pay equity, and approved salary budgets.
Understanding Pay at JHU
The university uses a role- and contribution-based job classification system that assigns each job a role, level, and market-based salary range. Compensation analysts classify a job based on a number of factors, including the job duties, difficulty, level of responsibility, supervisory oversight, specialized job-related skills, and other comparable positions.
Before the classification and pay for a specific job can be determined, you need to provide an accurate description of the job’s duties, responsibilities, and requirements. Here are some tips for writing a job description.
It’s the responsibility of the manager/supervisor to submit and discuss the job description with the Compensation Office. The job is then classified and assigned a role, level, and salary range.
The compensation program is designed to reward staff members for developing skills and competencies in their current jobs. It also supports career development by giving a staff member the opportunity to move into a different job within a career path.
Pay policies, in general, govern the following:
- New hire pay
- Salary and career growth opportunities, including developmental increases and promotions
- In-range salary increases
- Annual merit increases
- Equity- and market-based adjustments
- Special pay, including on-call pay, shift-differential pay, acting pay, and discretionary bonuses
- Changes to the salary structure
The compensation team members have access to internal and external data that help them advise you on appropriate pay determinations for the people who report to you. We participate in many compensation studies to obtain information about what comparable organizations are paying for similar jobs. The Compensation Office uses this information to help determine competitive pay levels for specific jobs in a defined labor market and to assess the competitiveness of our pay ranges relative to other organizations competing for the same talent. This benchmarking process includes:
- Salary surveys: The Compensation Office participates in and/or purchases more than 20 compensation surveys each year to gather data from the labor market. These surveys provide market information for a representative sample of jobs at the university.
- Job matching: The university’s actual job descriptions are matched to job descriptions provided in the salary surveys. To be considered a proper match, at least 70% of the job content must be similar in scope and responsibilities. The Office of Compensation consults with managers, as needed, to ensure that market matches are made appropriately.
- Survey scope: Because survey results may vary widely, the Compensation Office selects the data that best reflects the competitive market for a specific job based on critical factors, including geographic location, industry, and organization size.
The Compensation Office develops Market Reference Reports for hiring managers to ensure that compensation at the university is internally equitable and externally competitive. These reports include survey-reported compensation data and the university’s pay in comparison to the market. Based on the specific request, these reports can also include job classification and market pay information for each employee in a division/department/unit. The report is intended to serve as a tool to help managers with compensation planning, such as monitoring and maintaining internal equity, assessing potential pay growth opportunities, and determining new hire pay. It enables managers to make equitable and competitive pay decisions and recruit and retain talented individuals by paying them competitively.
There are a number of laws that govern how pay is determined and delivered. As a manager, you should become familiar with these important regulations.
|Fair Labor Standards Act (FLSA)*||Establishes minimum wage, overtime pay and exemptions, equal pay, child labor, hours of work, and record-keeping rules for employees (see additional information below)||Department of Labor (DOL)|
|Equal Pay Act (EPA)||Prohibits unequal pay for equal or substantially equal work performed by men and women||Equal Employment Opportunity Commission (EEOC)|
|Title VII of the Civil Rights Act (Equal Employment Opportunity Act)||Prohibits discrimination based on race, color, religion, sex (including pregnancy), or national origin||Equal Employment Opportunity Commission (EEOC)|
|Age Discrimination in Employment Act (ADEA)||Prohibits job discrimination in hiring, firing, or conditions of employment against individuals age 40 or older||Equal Employment Opportunity Commission (EEOC)|
|Americans with Disabilities Act (ADA)||Prohibits discrimination against individuals with disabilities in employment, public services, public accommodations, and telecommunications||Equal Employment Opportunity Commission (EEOC)|
|Sherman Antitrust Act (Competition Law)||Prohibits the exchange of detailed compensation information unless safe harbor guidelines are followed, thereby avoiding anti-competitive “price fixing”||U.S. Department of Justice; Federal Trade Commission|
|Executive Order 11246 (Federal Contractors)||Prohibits federal contractors and subcontractors who generally have contracts that exceed $10,000 from discriminating in employment and compensation decisions on the basis of race, color, religion, sex, or national origin||Office of Federal Contract Compliance Programs (OFCCP)|
|IRS 20 Factor Test for Independent Contractor||IRS uses factors to determine whether workers are employees or independent contractors||Internal Revenue Service (IRS)|
|State Labor Laws||Most states have laws governing employment and compensation, providing employee protection greater than federal laws|
*Fair Labor Standards Act
The Fair Labor Standards Act (FLSA) defines the criteria for determining when employees may be considered as exempt or nonexempt from overtime pay. The law also establishes federal minimum wage and hours worked record-keeping requirements. An exempt employee is one who earns more than the federal salary threshold (currently $23,660), performs a job that meets specific work-related criteria (highly independent and specialized, managerial oversight, etc.) and is exempt from receiving overtime pay when working beyond 40 hours in a work week. A nonexempt employee must be paid for all hours worked and at time-and-a-half of the regular hourly rate for hours worked in excess of 40 hours in a work week. Nonexempt employees also must be paid no less than the established federal or state minimum wage. Employers are required to maintain accurate records of actual hours worked for nonexempt employees.
The FLSA is governed by the Department of Labor. University job titles and salary ranges do not exclusively determine exempt status. An employee’s specific job duties and salary must meet all the requirements of FLSA regulations. In the university’s job classification system, nonexempt employees are classified in levels 1, 2, or 3, while exempt employees are classified in levels 3, 4, 5, or 6. Positions that are classified in level 3 are a mix of exempt and nonexempt jobs, but specific exemption details are consistent by job title.
Please access the FLSA Toolkit for Managers and Staff for additional related details.