Introduction and Rationale
In accordance with the mission and values of the University, Indiana State University will offer
employees a comprehensive program including direct compensation, benefits, career opportunities
and a positive culture and work environment. The University intends to maintain a program that is
fair and competitive without regard to race, color, religion, gender, age, national origin, sexual
orientation, the presence of a disability, or political affiliation.
Purpose and Objectives
The purpose of the compensation philosophy and supporting strategies is to establish a foundation for
a compensation program that reflects:
- The relationships among positions within the University as measured by market factors and internal
- The principles of an equitable compensation program.
- The competitive pay policy position for the University as compared against defined external markets.
Because of the importance of equitable and competitive compensation to the University and its employees, the
Board of Trustees and President have established a compensation program that will attain the following:
- External Competitiveness to provide a pay range for each position that will enable the University to attract
and retain the level of talent required to achieve University goals while assuring that the jobs are valued to
reflect the applicable markets as defined by the University.
- Internal Equity to ensure that each job has been fairly and objectively evaluated and placed within the pay
hierarchy based on how it relates to other jobs within the University community.
- Growth and Development to recognize employees for their dedication as well as individual efforts through a
variety of rewards while providing access to training and development to enhance opportunities for possible
career advancement within the University.
- Effective and Timely Administration to ensure that salary decisions and actions are rendered in a consistent
and fair manner while operating within appropriate parameters.
- Sustainable Wages to ensure that individuals are paid a living wage that allows them to meet their basic needs
in today's economy.
- Adaptability to Change to provide a plan that is capable of recognizing changes in job design and external
market influences through:
- revision of job descriptions and evaluations where job content has substantially changed;
- periodic review of positions in relation to the market and internal equity factors;
- at least every five years an external review of pay ranges in relation to market trends to stay abreast of
changing market conditions with the goal of remaining competitive with the University's defined markets.
Salary Administrative Guidelines
One of the major factors in assuring that the Total Rewards Program is effective is the maintenance of
consistent procedures in the administration of the compensation plan. Therefore, ISU will establish
guidelines for the routine day to day compensation decisions.
- Market Adjustments:
- Market Adjustments are a mechanism through which starting salaries are adjusted for
- The amount of adjustment will vary as to the ability of the university to budget the
dollars necessary to stay competitive with the market.
- Adjustments in salary will at least reflect the movement of staff to the minimum of the
new market range.
- When possible adjustments will be made for staff below the midpoint in order to
maintain equity and minimize the issues of compression.
- Hiring Rates of Pay:
- An individual that meets the education and experience required by the job description
will normally start at the minimum of the assigned salary grade. However if the range
has not been moved to be competitive with the market the starting salary may be set
within the first quartile of the range with consultation with Human Resources.
- An individual that has experience beyond that required for the position may receive
credit for past experience. Experience that is directly related to the position for which
the individual is being hired will be weighted more than experience that is not directly
related. For nonexempt employees this will normally be no higher than 10% above the
base of the range. If it is an exempt position the hiring rate will not be higher than the
Midpoint of the assigned salary range.
- Any requests for exception will be made to the Compensation Director who will review
based on equity considerations within the classifications and pay ranges in consultation
with the AVP of Human Resources.
- An employee who receives a promotion to a job in a higher salary range will receive an
increase in pay up to 10% of the new range midpoint, or the amount necessary to bring
his/her salary to the minimum rate of the new salary range.
- An employee who has been moved more than one range may receive an increase of
15% of the range midpoint or to the minimum rate of the new salary range whichever is
- Promotion increases may vary from the above due to the pay relationship among the
employee and persons occupying identical and similar jobs, and his/her immediate
- An employee receiving a promotion to a non-exempt position will be evaluated on
his/her performance ninety (90) days after the promotion.
- An employee receiving a promotion to an exempt position will be evaluated on his/her
performance six (6) months after the promotion.
- Voluntary Demotion:
- If an employee voluntarily requests an assignment to a job in a lower salary
range, and the university determines there is a clear benefit to the demotion,
the employee's pay will be reduced by the amount necessary to ensure his/her
relationship to the midpoint in the lower range is the same as the current
relationship to the midpoint in the initial range.
- If the organization determines there is no clear organizational benefit to the
employee's demotion, his/her pay will be reduced by an amount, which places it
between the minimum and midpoint rate of the new range.
- Non-voluntary Demotion:
- When an employee is non-voluntarily demoted to a job in a lower salary range
for performance-related reasons, his/her pay will be reduced by an amount,
which places it between the minimum and midpoint rate of the new range. The
exact amount of the reduction will be determined by the appropriate
management person. However if there is a benefit to the university as a result
of the qualifications of the employee they may be placed higher in the range if it
can be justified. This is done on a case by case basis.
- When an employee is non-voluntarily demoted to a job in a lower salary range,
and the demotion does not involve performance-related issues, the employee's
treatment will vary depending upon his/her qualifications for the new job. If
fully qualified for the job in the lower salary range, he/she will continue to
receive the same pay or pay equal to the maximum value of the lower range,
whichever is lower. However, if he/she is not fully qualified for the job in the
lower salary his/her pay will be reduced by an amount, which places it between
the minimum and midpoint rate of the lower range.
- Transfers (lateral moves):
- When an employee moves from one job classification to another job classification that is
compensated in the same salary range, there normally is no pay adjustment. Unless it
can be demonstrated that it is a clear benefit to the university, for an adjustment based
on the expertise of the employee. This would be determined on a case by case basis in
discussion with Human Resources.