[NCASG] Minimum Wage Increase and Salary Compression

Mon May 3 08:01:10 MDT 2021

Hi Jennifer,

Please see below for New York's responses to your questions.

Thanks,

Adam

Adam Reinemann
Human Resources Specialist 2 (Classification & Compensation)

Department of Civil Service
Empire State Plaza, Agency Building 1, Albany, NY 12239

(518) 474-0789 l Adam.Reinemann at cs.ny.gov<mailto:Adam.Reinemann at cs.ny.gov>
www.cs.ny.gov<http://www.cs.ny.gov/>

From: Boswell, Jennifer <Jennifer.Boswell at dms.fl.gov<mailto:Jennifer.Boswell at dms.fl.gov>>
Sent: Thursday, April 29, 2021 9:44 AM
To: dhr_ncasg_survey_list at admws.idaho.gov<mailto:dhr_ncasg_survey_list at admws.idaho.gov>
Subject: [NCASG] Minimum Wage Increase and Salary Compression

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Good morning colleagues,

The state of Florida is in need of your assistance.  In November's general election, our voters approved a constitutional amendment raising the state's minimum wage from $8.65 per hour (effective January 1, 2021) to $10.00 per hour effective September 30, 2021; and raising it an additional $1.00 per hour every September 30th until it reaches $15.00 per hour.  Earlier this week, a legislative proposal was released including a minimum wage increase to $13.00 per hour on July 1, 2021, and tasks each agency with developing a plan to address salary compression as a result of implementing the increase.

Any guidance you can provide, including links and or documents, in reference to the following questions would be greatly appreciated.

  1.  Does your state have a compensation philosophy?  If yes, please share.
Generally speaking, New York's compensation philosophy centers around the idea of "equal pay for equal work." The policy supporting this idea is found in Section 115 of New York's Civil Service Law. Equal pay for equal work is in reference to positions and classes within the classified service (most of the state workforce) of New York State government, not necessarily in relation to private sector jobs, although we do have some mechanisms to address compensation issues based on external comparisons.

  1.  Does your state have any type of plan or guidance related to salary determination?  If yes, please share.
New York's state workforce is primarily unionized, and each title is assigned a grade which dictates salary. Most employees are paid based on salary schedules that are established via collective bargaining. Salary schedules are statutory in New York. Employees generally start at "Hiring Rate" for the grade of their position, have six or seven steps for each year of service, and at year six or seven, reach "Job Rate." We have one mechanism that allows a candidate to receive a salary at an advanced step upon their initial hire, based on experience substantially exceeding minimum qualifications. This is known as an Increased Minimum, and is typically applied only to classes where there are recruitment difficulties, such as clinical titles.

Salary Schedules: https://www.cs.ny.gov/businesssuite/Compensation/Salary-Schedules/
Increased Minimum Policy: https://www.cs.ny.gov/ssd/Manuals/SPMM/0800PositClassComp/0870f_appointments_above_min_salary.htm

New York's salary schedules are statutory, but we also have positions that are coded as Non-Statutory (NS). NS positions are typically at-will positions (executive management or politically sensitive jobs), and do not follow a statutory salary schedule. We do not issue formal salary guidance for these positions. Agencies can request whatever rate that they can get approved through our state budget division, although recently, NS position salaries have been equated to those of graded positions at comparable levels of responsibility.

  1.  Does your state have any type of plan or guidance to address salary compression?  If yes, please share.
We have one mechanism used in very specific circumstances for non-union employees. See https://www.cs.ny.gov/ssd/Manuals/SPMM/0800PositClassComp/0870e_occupational_pay_differentials.htm.

  1.  Does your state modify its pay range minimum and maximum amounts annually?  If so, how are the amounts determined?
Generally, minimum and maximum amounts increase by 2% per year, unless increases are withheld due to budget issues.

  1.  What type of classification system does your state utilize (i.e., class-based, broadband, etc.)?  How long has it been in effect?
Class-based system since 1949. We explored options for a broadband system in the last five years, but we do not have the appropriate legal framework to implement such a system at this point.

  1.  What types of benefits and/or challenges do you experience with your current classification system?  Is there a system you have used previously that you prefer?

Benefits: System stability. Salaries and promotion opportunities are predictable for employees. Limited individual salary determinations are performed for most classified service jobs, saving HR time. Relatively simple to perform cross-class comparisons to set up new positions at agencies.

Challenges: Limited pay flexibility for most positions. Adjusting the allocation (grade) of large or interdepartmental classes is a major undertaking involving multiple State control agencies (Budget, Office of the State Comptroller, Civil Service). System is slow to adjust to market issues impacting the private sector which creates recruitment issues. Difficulty explaining system mechanisms to new hires who have familiarity with the private sector. Outside of the salary step system, there is no way to reward employees on a monetary basis for good work.

  1.  Has your state recently undergone a classification and/or compensation study?  If so, what were the key take-aways, and who completed the study?
We are currently performing a pay equity study with the Center for Women and Government and Civil Society (CWGCS) at the University at Albany. See attached memo for background. We have collected the survey data, and analysis is ongoing. CWGCS and our division (Classification & Compensation - Civil Service) are working jointly on this study. We last conducted a study of this nature from 1982-1985.

  1.  What vendors have you utilized for assistance regarding statewide classification and compensation, if any?
N/A. All classification work is done in-house at the moment. We do not use consultants. We have about 150,000 positions that 15 staff are responsible for managing.

Thank you all for your assistance,

Jennifer Boswell | Division of State Human Resource Management
850.488.2445 (office)
Florida Department of Management Services
We Serve Those Who Serve Florida

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