UNIVERSITY OF ILLINOIS AT URBANA-CHAMPAIGN FY 2015 BUDGET GUIDELINES

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1 UNIVERSITY OF ILLINOIS AT URBANA-CHAMPAIGN FY 2015 BUDGET GUIDELINES SALARY RATE INCREASES The general personnel salary program consists of a merit-based 2.5% increment, except where union settlements dictate otherwise. As a merit-based program, it is expected that there will be a range of salary increases within a unit. Details by employee category follow, and your budget letter contains the details of your allocations. Employees who have been hired (new hire or new position) on or after March 1, 2014 or who received a significant pay increase effective March 1, 2014 or after will not generally be considered for an August 2014 increase, unless a prior commitment was made. The recent salary adjustments for specialized faculty will not preclude those employees from participating in the annual salary program. As in the past, Provost approval is required for the following: Salary increases greater than 7%; Academic salary assignments of $90,000 that are new appointments or are meeting/exceeding this salary level for the first time (per Communication No. 3); Salary increases for individuals hired on or after March 1, 2014 without a prior commitment for a salary program increase; and Salary increases for individuals who received a significant pay increase effective March 1, 2014 or after without a prior commitment for a salary program increase. To facilitate the processing of your budget, please submit these items to the Provost Office for approval when your budget is completed. The following do not need Provost approval but require justification noted in Salary Planner for budgeted positions or in the comments on the job in HRFE transactions for non-budgeted positions: Salary increases previously committed to for individuals hired on or after March 1, 2014; Salary increases previously committed for individuals who received a significant increase effective March 1, 2014 or after; Zero-percent increases in Salary Planner for budgeted appointments; and Anniversary Date increases of zero for non-budgeted reappointments. With advance written approval from the Provost s Office, you will be allowed to reallocate additional funds for salary increases beyond those provided by the campus. Reallocations can only be used to the extent that your unit has available funding. Additionally, the unit must also have a salary deficit shown on the annual DMI salary analysis. Because the campus is required to track reallocations funding, units must provide reallocation totals to the campus (Vicky Gress, Associate Provost).

2 Academic Employees Faculty The competitiveness of faculty salaries has been, and continues to be, a major concern of the UIUC campus. Additional funds (beyond 2.5% of base) are being allocated to colleges for strategic faculty salary needs. These additional funds (.5% of a college s filled faculty base) should be targeted to compression, market, equity and retention issues. The funds should be assigned to individuals in addition to normal participation in the 2.5% general salary program. It is expected that this additional pool of funds will generally be limited to no more than one-half of your faculty and staff and that the vast majority of these funds will be directed to faculty. Funds are also provided for faculty promotions. The campus amounts provided for promotions are $7,000 for promotion to associate professor and $10,000 to full professor. Since the intention of increasing the promotion supplement is to increase the salaries of promoted faculty, these additional funds are not intended to replace unit promotion supplements, merit or CMER increases. Academic Professional, Specialized Faculty, Other Academic Staff and Open Range Employees Units can allocate additional funds beyond the general salary program to address compression, merit, market and equity problems for these groups of employees. Units are to conduct performance appraisals for all academic staff and open-range staff members prior to recommending merit increases in accordance with campus policies. Completed forms from the appraisals should be retained in the unit. It is important that units note the specific information concerning Visiting Academic Professionals and GEO represented Graduate Assistants in the Collective Bargaining section below. Units should use the HR Salary Planner to submit the bulk of their academic salary increase recommendations. Academic Human Resources will manage the academic salary planner processes. Questions about using the HR Salary Planner for processing salary increases and reappointments should be directed to Cindy Debrock, (debrock@illinois.edu) or Questions regarding the use of the HR Salary Planner program can be directed to Doug Lamb, (dougl@illinois.edu) or Specialized Faculty The minimum salary for a 9-month, full-time non-visiting specialized faculty member is $40,000. 2

3 Academic Professional Employees The minimum salary for 12-month full-time academic professional staff is being increased to $30,826 pro-rated for FTE and service basis. Academic Human Resources (AHR) will monitor to ensure all academic staff are appointed in alignment with the minimum. AP employees who have been issued a notice of non-reappointment based on performance shortcomings should not receive a salary increase. AHR will monitor to ensure no increase is given in these situations. Academic Collective Bargaining Units Salary increases for employees in these categories are governed by negotiated agreements and units must consult the appropriate collective bargaining agreement for details concerning salaries. Please contact Academic Human Resources, Sharon Reynolds (sreynlds@illinois.edu), or Karen McLaughlin (karenmcl@illinois.edu) if you have questions about specific contract provisions. Visiting Academic Professionals The Visiting Academic Professionals (VAP) agreement establishes that all VAP bargaining unit employees who are employed as of August 15, 2014 shall be eligible for a wage increase on their individual appointment renewal date occurring between August 16, 2014 and August 15, 2015, that is subject to the salary increment set forth in the campus general salary program [Budget Guidelines] for non-represented academic professionals. This means eligible VAP bargaining unit employees may receive a wage increase that is less than, equivalent to, or greater than the 2.5% increment, provided that any increase granted by the department or unit conforms with these Guidelines. A VAP bargaining unit employee s salary shall be no less than the campus minimum salary level for non-represented academic professional employees. Units with VAP bargaining unit employees who have an individual appointment renewal date occurring before August 16, 2014, should contact Sharon Reynolds or Karen McLaughlin, Academic Human Resources, ( ) for guidance on salary treatment. Graduate Assistants The Graduate Employees Organization (GEO) agreement establishes specific wage provisions, including: Minimum: Based on the collective bargaining agreement with the GEO, in AY15, the minimum salary for a 50%, nine-month appointment will be $15, Appointments of a different duration or percentage shall be figured proportionately. The appointing unit may pay above the minimum amount. 3

4 Continuing: Continuing assistants are those who are reappointed in the same job and in the same unit that the assistant held in the previous semester (summer excluded) or within the three previous academic years. Continuing TAs or GAs must receive an increase of at least 2.5% or the new minimum for AY15, whichever is greater. The appointing unit may pay above the minimum percent increment (2.5%) for a continuing TA or GA. RA/PGA/TAR Minimum: The minimum salary for a 50%, nine month appointment is being increased to $15, Appointments of a different duration or percentage shall be figured proportionately. The appointing unit may pay above the minimum amount. Continuing: Continuing assistants are those that are reappointed in the same job and in the same unit that the assistant held in the previous semester (summer excluded) or within the three previous academic years. Continuing, non-represented assistants (RA, PGA) must receive an increase of at least 2.5% or the new minimum for AY15, whichever is greater. The appointing unit may pay above the minimum percent increment (2.5%) for a continuing RA or PGA Minimum salary ranges can be accessed at: Civil Service Employees Open Range Employees It is expected that increases for open range employees, as a group, should match the increases for academic professionals. Current salary maxima will be increased by 2.5%. Salaries for employees at the current maximum will not be raised automatically; it will be the units responsibility to do so and the necessary funding is a unit responsibility. Employees in a probationary period are not eligible for consideration for a merit increase until they have successfully completed their probationary period. Units are reminded to conduct performance appraisals for all Open Range employees prior to recommending merit increases. Units should use the HR Salary Planner to submit their Open Range salary increase recommendations. Staff Human Resources will electronically retrieve the final Open Range increases from units. The deadline will be announced at a later date. Questions about using the HR Salary Planner for processing Open Range salary increases or about the Open Range salary program in general should be directed to Robbie Witt (rswitt@illinois.edu) or Philip Stanton (prstanto@illinois.edu), Staff Human Resources,

5 Civil Service Collective Bargaining Units and Prevailing Wage Categories Salary increases for employees in these categories are governed by negotiated agreements and units must consult the appropriate collective bargaining agreement for details concerning salaries. Please contact the Staff Human Resources office if you have questions about specific civil service contract provisions. For questions related to civil service employees covered by a collective bargaining agreement, please contact Leslie Arvan (Arvan@illinois.edu), As always, units are responsible for funding the costs of negotiated agreements. Wages There will be no increases provided on wages, subject to a limited number of exceptions. PRICE INCREASES No general price increase funds are being provided in FY PROTECTION OF AFFIRMATIVE ACTION PROGRAM In implementing these Budget Guidelines, please remember the commitment of this campus to equal opportunity and affirmative action. Particular attention should be given to the question of equitable compensation for women and members of underrepresented minorities who are appointed to faculty, academic professional and staff positions. Only a continuing commitment to the goals of affirmative action will ensure our success in this critical area. We continue to be concerned about salary equity between males and females. As you make salary decisions, please be sensitive to this issue. SUMMER SESSION Under Provost Communication One, units do not receive a summer session allocation but generate summer budgets from the instructional units they generate in the summer. Summer allocations for FY 2015 are based on estimated summer 2014 undergraduate income and summer 2013 instructional units. In the fall, adjustments will be recorded to reflect summer 2014 instructional units and actual summer 2014 tuition earnings. FY 2015 BUDGET ASSESSMENTS Units are receiving a reduction of.25% of their State, Income Fund and ICR bases to fund the TOP/Dual career/faculty Excellence program, campus diversity initiatives, Medicare and Worker s Compensation increases, and system-level cost increases. In addition, units will be required to contribute 1.75% of their State, Income fund and ICR budget to 5

6 common costs, including the restoration of the building maintenance, strategic initiatives, recruiting efforts, and other common costs. Units will also receive an assessment to fund the FY 2015 salary program (2.5%). Units generating undergraduate tuition will receive an offsetting allocation proportionate to the portion of a unit s budget funded by base rate tuition. Overhead units directly or indirectly supporting undergraduate education may also receive full or partial support for their salary program. CONTROL OF FUNDS DURING FY 2015 As much flexibility will be given to units as possible. In developing the budget for State funds, units will be allowed to reallocate funds from one budget category (academic salaries, nonacademic salaries, wages, expense, and equipment) to another. Each major academic unit may have an "unassigned account" in which all funds for vacant academic positions, new allocations, or dollars generated through the reduction or elimination of programs by the college will reside until the relevant Vice Chancellors, Deans and Directors determine the utilization of the resources. Vice Chancellors, Deans and Directors will continue to control salary dollars related to academic leave lines. Units will retain control of all funds related to academic and civil service staff salary lines that become vacant during the year. Units are encouraged to give serious thought to infrastructure needs (wages, expense, or equipment) when deciding whether or how to replace personnel. There is a great deal of uncertainty with the budget in the coming year because the tax increase may be repealed and because we may need to absorb costs associated with statewide pension reform. Therefore, units are also required to hold centrally 2% of their permanent state budget. Mid-year when greater certainty is known these funds will either be collected for a mid-year rescission or be released for spending. ALLOCATION OF ICR FUNDS Unless another distribution formula has been approved for a unit, 45% of indirect cost recoveries (ICR) related to facilities and administration will be distributed to the college and department. 75% of earnings related to tuition remission will be distributed to the academic college of the student generating the remission. Remission funds may be used to fund graduate education and support graduate students. These funds can be used by units to fund partial fellowships required as student s salaries reach the NIH salary cap. Allocated ICR earned via the budget reform incremental growth calculations will be returned to the campus by an allocation adjustment. Academic units that received allocated ICR budget outside of the budget reform incremental growth calculation will retain these allocations in the form of state funds. 6

7 The procedures to be followed in preparing the FY 2015 budget for ICR earnings are as follows: 1. An estimate of the F&A earnings portion of the total indirect cost to be recovered during FY 2015 is to be made by the college and department and recorded as a revenue and expense budget in the appropriate C-FOP via the budget development application. Program codes used for budgeting F&A related ICR should have the E arned attribute. Please review the FY11-FY13 historical F&A earnings modeling data provided to your unit as guidance with estimating FY15 earnings. 2. An estimate of the tuition remission earnings portion of the total indirect cost to be recovered during FY 2015 is to be made by the college and recorded as a revenue and expense budget in the appropriate college-level C-FOP via the budget development application. The program code used for budgeting remission related ICR should have the T uition remission attribute. Please review the FY11-FY13 historical tuition remission earnings modeling data provided to your unit as guidance with estimating FY15 earnings. 3. Do not include expected carry-over in the FY 2015 budget process. 4. The recorded budget for F&A earnings will be reflected in monthly detailed F&A earnings statements. Budget adjustments will be made semi-annually to reflect the actual and projected earnings for the year. 5. The recorded budget and actual tuition remission earnings will be reflected in quarterly tuition remission earnings statements. The budget office will transfer actual tuition remission revenue on a quarterly basis to the designated collegelevel tuition remission FOP; the budget will be adjusted to reflect actual recoveries at the end of FY15. The college is responsible for distributing the tuition remission based on their internal ICR policy. 6. Since allocations for both F&A and tuition remission earnings will be adjusted to reflect actual earnings, units will not be either advantaged or disadvantaged by the level at which they set their earnings estimate. In the case of interdisciplinary programs, there may be some question as to the distribution of ICR funds. If the parties involved are unable to resolve a problem of this nature, they should consult the Office of the Provost. Please remember that no F&A funds should be budgeted or expended for the direct support of instructional programs. Instructional programs are those courses which are credit bearing and/or courses which lead to a credit-bearing degree. Additionally, ICR funds should not be expended in administrative units whose only activity is the support of instructional programs. While every effort will be made to accommodate the individual ICR carry-over requests of departments, the campus, as a whole, is limited to a carryover of 30% of the total ICR budget. Please work with the budget office of the Office of Business and Financial Services if you anticipate a large increase in your year-end balance. 7

8 BUDGETING ENDOWMENT INCOME Units receiving endowment income will be notified of the assigned FY 2015 budget excluding carry-over balances. The FY 2015 budgeted amount is based upon 4.0% of a six-year moving average of the endowment pool market value. The income budgeted for FY 2015 is guaranteed; however, additions or withdrawals from the endowment pool made prior to June 30, 2014 will result in a budget adjustment. Over or under realizations of income at the end of FY 2015 will be charged or credited to the account which holds gains or losses from sales of securities. RESTRICTED FUNDS Restricted funds include all grants, contracts, self-supporting and auxiliary activities, storeroom and service departments, and other similar accounts, the use of which is restricted to specific purposes. Expenditures made from these funds are subject to the Board of Trustees general rules governing such expenditures and must be within the total income accruing in the account involved. It is the responsibility of department heads and similar officers to see that funds are available for all positions or other items listed under restricted fund accounts. Salary minima, union negotiations, and other University regulations governing appointments and the use of funds are applicable to restricted funds. Salary increase decisions for individuals funded with restricted funds are subject to the same guidelines as govern such decisions for individuals funded with State funds. CONCLUSION Questions concerning these Budget Guidelines should be addressed to Vicky Gress or Andrea Hoey ( ) or Suzanne Rinehart ( ). 8