Update on HR compensation modernization initiative

February 25, 2021

UNIVERSITY PARK, Pa. -- Penn State Human Resources (HR) is committed to providing periodic updates on the Compensation Modernization Initiative, a large-scale project begun last year and spanning 2021 that will modernize Penn State’s compensation and career structures related to staff positions. To answer recent questions from staff members across the University, HR is providing both an email update to staff members and managers and a news update to the entire Penn State community describing its efforts to gather feedback, potential staff impacts, the structure of the project team and next steps.

Initiative overview

The Compensation Modernization Initiative is part of Penn State’s continuing efforts to attract the best talent and retain its highly valued staff members. Key focus areas of the initiative include:

  • Establishing a compensation philosophy, a formal framework that describes Penn State’s overall approach to employee compensation;
  • Updating job documentation;
  • Benchmarking the majority of staff jobs;
  • Analyzing pay structure and levels;
  • Updating how compensation decisions are made;
  • Offering visibility into career paths for staff members; and
  • Providing comprehensive, transparent, and streamlined compensation and career services to managers and their staff.

The goal of the initiative is to create modern, competitive compensation structures and clear, supportive career development resources for staff members to use. This is a significant undertaking for an institution as large as Penn State, and the initiative is expected to run through early 2022. However, changes that result from the initiative may take several years to fully achieve.

Gathering feedback

This past December, Penn State staff members, along with those who manage staff, were invited to participate in virtual focus groups to share feedback on their experience with Penn State’s compensation and career structures. These large-scale focus groups were hosted on the Remesh platform, a technology that uses extensive data processing to capture responses. Each of the four sessions had over 300 participants, with a total of almost 1,700 individuals across all campus locations participating. Participants’ feedback is being used as a foundation for the design and implementation of updated compensation and career structures. Participants also were encouraged to submit questions and concerns during the sessions to inform HR’s approach throughout the project and increase relevance of future communications.

Staff Impact

HR has received many questions and concerns from staff members and managers on how the Compensation Modernization Initiative will affect them, particularly around pay and regarding the future of their position. HR does not intend to lower any individual’s pay or remove any jobs as a direct result of this initiative.

HR will review the compensation of each staff position relative to the external market and relative to internal equity. The restructured pay system and market reviews will apply to all staff positions as HR aligns compensation to market value. Specific information on how individual positions will be affected will be provided after the new structures and processes are fully implemented. Resources and support for managers will be rolled out as part of the initiative’s implementation plan.

Project Team 

HR has partnered with Segal, a national human resources consulting firm. Segal works with hundreds of higher education institutions and has partnered with Penn State HR on past initiatives. Segal brings expertise to help Penn State address current and future issues and concerns around staff compensation and career paths. All work is monitored and approved by an executive steering committee, comprised of representatives from across the University. The development of resources, such as the compensation philosophy, updated job architecture and a market assessment, is led by a design team and will be launched by a delivery team made up of HR team members. A list of all those contributing to the project can be accessed here.

Next Steps

During the first quarter of 2021, HR will introduce a process to document current job responsibilities for each staff member. Managers and staff will be able to work with their HR Strategic Partners and Consultants as needed. 

HR received questions about how pay decisions will be made, what the new compensation and career structures will look like, and other similar specific questions. The project is still in its early phases, so many of the questions and concerns documented by HR will be addressed at a later date. A website on the initiative is currently under development to help the Penn State community stay up to date and informed as the project progresses. A summary of feedback received by staff and managers during the focus groups also will be shared on this site.

Contact Information

For questions regarding the Compensation Modernization Initiative, please email hrcompinitiative@psu.edu. For personal HR questions related to compensation or career development, employees should contact their unit’s HR strategic partner.

 

Last Updated February 25, 2021