# Manager Questions on the Staff Salary Increase Process

At Waterloo, there are many complexities with the staff salary increase process, especially when it comes to employee leaves, secondments, and the variety of employee types we have at the University. If you are a new manager, the following scenario answers may assist you.

### Please explain/clarify how salaries/merit increases are calculated. Is a cost-of-living adjustment included in the calculation?

The staff salary increase process does not provide a cost-of-living adjustment – it's all merit based. Salary adjustments are calculated based on the employee’s pay position within the range and the target salary position (based on the performance evaluation). More information can be found on the “Understanding Staff Salary Increases – May 2021 Information Session” located on the compensation website.

As per Policy 5, individual salary increases are determined by a performance evaluation system with specific “performance goals,” i.e. 100% of salary range for a competent performer, 110% for a continuing outstanding performer, and 120% for a continuing distinguished performer. A target salary of 100% of salary range aligns with a performance rating of 3.0, a target salary of 110% aligns with a performance rating of 4.0, and a target salary of 120% aligns with a performance rating of 5.0.

### What is job value, and what does this mean?

A job value is 100% of the USG job grade’s pay range. The University’s target pay position is the 50th percentile or median of the market – the job values for each pay grade are intended to align to the median position. The Secretariat website provides helpful information about the University’s compensation program for staff.

### What is a compa-ratio, and how is it calculated?

A compa-ratio identifies an employee’s pay position within the range. Each USG job grade has a pay range from 80% to 120% of job value; job value is the 100% pay position within the range. To calculate a compa-ratio for an employee, divide the salary by the job value of the salary range.

### How are the ratings in the Performance Appraisals (PAs) calculated? Is there a specific formula?

There isn’t a specific formula, Managers are responsible for assigning a performance rating each year. The appraisal document is meant to highlight employees’ accomplishments/achievements that support the rating. The Secretariat website provides helpful information about the University’s compensation program for staff.

### How does a merit increase relate to the Performance Appraisal (PA)? Is there a direct correlation between the rating and the increase? If so, how does that work?

Yes, the performance rating translates into a target salary, which is used to calculate the increase relative to the pay position (compa-ratio) in the scale adjusted pay range.

### If two people get the same rating, do they get the same merit percentage increase?

Increases are calculated based on each employee’s details – pay position in the pay grade along with the performance rating. Unless the pay position and pay grade are identical, it is unlikely that the same rating will result in the same salary increase.

### When we get past the 100% job value, why do our salary increases get smaller?

The University’s target is to pay at or around the job value for the position. There is an escalator built into the merit increase calculator for those paid under job value, to support the timeline associated with their becoming fully competent in the role.

### What is being done in regard to aligning salary increases to the high costs of inflation the past couple of years?

The Provost’s Advisory Committee on Staff Compensation (PACSC) reviews the compensation structure relative to the market, supporting the development of salary agreements. The current salary agreement expires April 30, 2024.

### How are individuals placed on the salary scale in the first place – assuming determining factors include education, skills, and experience, but it isn’t clearly shown how/where these factors place you on the scale?

Job documentation is reviewed by Human Resources in order to assign jobs to the USG pay grades within the staff compensation structure. Skills and experience of incumbents do not impact the job grade assigned to the position. Skills and experience of candidates do influence the salary that a hiring manager offers during recruitment, keeping in mind other factors such as internal equity.

### I am a new manager. How can I get access to past performance ratings and performance appraisals for my team?

An Excel file containing the historical ratings from the last three years is sent to the pool approvers early February of every year.  Copies of historical performance documentation should be with both the employee as well as the previous manager. Historical performance evaluations should not be used to evaluate the achievements in subsequent performance years.

### I need to do a performance appraisal for employees on secondment in my team. Can I have access to their past performance appraisals?

All seconded employees will be reported in their home pool. Please connect with the home manager to obtain feedback and discuss collaboratively about their performance year. Historical performance evaluations should not be used to evaluate the achievements in subsequent performance years.

### One of my employees is on secondment to another department and appears on our department ratings report.  Do I have to agree with the performance rating assigned by their secondment manager?

Performance ratings for employees on secondment are provided to Human Resources from the manager at time of merit. The home manager and the secondment manager are expected to work together to agree on an appropriate performance rating for the year. The performance rating should be determined based on a blend of performance within both roles.

### I have held a performance conversation with my employee and provided them with their assigned performance rating.  Do we have to complete and submit the performance appraisal form to Human Resources?

Please print, sign and submit performance appraisals to Chantal Moore in Human Resources via interoffice (using a confidential envelope) by March 22, 2023. Copies of the signed performance documentation should be retained by the manager and employee.

### My employee was away on leave for part of the year.  Are they eligible for a merit increase May 1?

The answer will depend on the type of leave the employee is on as of May 1.  Any employee who is on an unpaid leave of absence as of May 1 is not eligible for merit. Any employee who is on sick leave will receive performance-based merit effective May 1.  Any employee on an ESA leave (Pregnancy/parental) will have the adjustment upon their return to work.  Any employee in receipt of LTD on May 1 are ineligible for a merit increase; however, these employees will receive a salary range adjustment upon their returning to full regular duties.

### How do I manage the performance appraisal conversation when an employee is on leave during the annual review process?

Performance conversations should be held while an employee is on leave if there is an ability to do so.  If there is no ability to have this conversation during the leave, please ensure that this occurs once the employee returns.

### My employee and I disagree with the performance assessment and assigned rating, and they do not want to sign the performance appraisal.  How should this be handled?

The signature is to confirm that the conversation occurred, not that the employee agrees with the content. The employee has the option to indicate the disagreement in the staff member’s comments section.

### How do we determine the rating when the employee has been working in my department for a portion of the time and in another department for the remainder of the time?

Please connect with the previous manager to gain a full understanding of the employee’s performance so that a rating can be applied that reflects the entire performance year.

### Do union employees participate in the staff salary increase process?

CUPE employees are not included in this process. Only regular ongoing staff are included in the merit program, which is also called the Staff Salary Increase (SSI) process.

### My employee is returning from a secondment late in performance year. Who is responsible for the review, rating, and performance conversation?

The manager at time of merit is responsible for the performance appraisal, including the rating.  Please work with the secondment manager to gain an understanding about the employee’s performance for the year.

### If an employee is on secondment during a leave and then moves to another department, who is responsible for completing the performance appraisal including the rating?

The manager at time of merit is responsible for the performance apprasisal, including the rating. We would expect that both home manager and new department manager would collaborate on the performance appraisal and rating.  The compensation rating guideline will also provide guiding principles on how to apply a rating when an employee is on leave/was on leave during the performance year.