Classification for the Future

The Ups and Downs of Class Consolidation

International Personnel Management Association

Training ConferenceOttawa, Canada

October 19-23, 2002

Agenda

• Why class consolidation• Different ways to consolidate• Outcomes • Lessons learned• Discussion by Gwinnett County and

City of Dallas

Why Class Consolidation?

• The average number of employees to class titles is 3

• Most organizations have expanded the number of titles by an average of 10% per year

• Jobs and technology have changed• Most employees want their own job title• Individual job titles mean higher pay

Different Ways to Consolidate

• By occupational focus– Engineering– Finance– Human resources– Etc

• By department focus– Public Works– Fire– Budget office

• By salary grade

Four Levels of Work

• Entry

• Developmental

• Full Performance

• Master/Supervisory

• Basic skills, learns to do things “our way”

• Developing proficiency

• Fully competent to perform all aspects of job

• Recognized expert

Outcomes-Positives

• 50% reduction of classifications• More generic class descriptions• Easier management of personnel• Less administrative time spent on

class reviews• Fewer pay grades

Outcomes-Negative

• Employees don’t “see” their position in the class description

• Employees treated more generically• Potential higher payroll• Perceived pay compression of

employees who used to be in different pay ranges are now in the same

• Requires strong management

Gwinnett County Government

Roderick Powell, SPHRHuman Resources Director

Organization Facts:• 3,859 authorized positions in 2002• Approx. 650 job classifications before study• Approx. 650,000 citizens served• Nonunion environment – “unofficial” unions

organized but not recognized by the BOC as bargaining unit

• Full service Human Resources Department:– Compensation– HRIS / Records– Employee Relations– Organizational Development– Employment

Prior System

• 10 Point FES (Factor Evaluation System)– Used same system since 1983

• 2001 Requests for Reclassification– 248 Requests / 85 position studies

completed– 74 upgraded, 1 downgraded, 10 stayed the

same

• Compensation System managed by a Division Director and 2 HR Generalists

Difficulties with Prior System:

• Bureaucratic system– Department Review– Merit Board Approval– BOC approval

• System manipulation to get upgrades• Too many individual classifications• Job description too detailed/job specific• Request for reclassifications submitted

for every little change in duty– Focus is on volume and length of job

description

Consolidation Process

• Fox Lawson & Associates contracted to consolidate where feasible

• PDQs (Position Description Questionnaires) completed by every employee

• Peer panels conducted for job families– Employees selected at random by FLA to represent

each classification– Some individual (unique job) interviews conducted

• Jobs requiring licenses/certifications in the same classification as others that did not have the same requirement were compensated through Pay for Performance System.

Timeline:

• Contract awarded in May 2001• PDQs submitted to FLA in August

2001• Peer Panel interviews Jan/Feb 2002• Draft consolidated job descriptions

June 2002• Merit Board & BOC final approval Dec

2002• To be implemented 1st Qtr 2003

Communication:

• Countyline Newsletter Articles monthly• All employee emails and memos• All employee meetings• Weekly update meetings with County Admin & COO• Dept Director / Elected Official Briefings• Supv/employee Education

– Broad banding– New DBM System– Generic Job Descriptions– New Performance Management System

• Dept POC (Point of Contact) Meetings• AskCCR@hotmail.com

• AskCCR Comment box

Results:

• Job classifications reduced from approx. 650 to 300

• Job family approach:– Classifications grouped by type of work

not department– Similar knowledge and skills– 3 to 4 levels in each job family

Reactions:

• Consolidation of 650 to 300 tough to digest• Many concerns from departments and employees

– Internal equity compared to “old FES system”

• Resistance to change became an issue– Detailed/custom job descriptions to generic– Work job titles

• Entitlement mentality vs. Pay for Performance• External market pay vs. COLAs (3% annually)

Reviews & Appeals

• HR/FLA vs. Department/Employees

• Formal appeals to FLA

• Requests for review – HR Director

Thoughts & Recommendations

• Communicate timeline and progress throughout process

• Top management commitment• Consultants with Government experience• Try to “manage expectations”• Ability of Consultant/Contractor to defend

policies/data/implementation• “True Commitment” to market pay

City Of DallasCity Of Dallas

Compensation – 2001 and BeyondCompensation – 2001 and Beyond  

Before 2001

o In1994, switched from step system to pay for performance

o Ten pay schedules:o Seven civilian o Three uniformed o 950+ classifications

o HR functioned as pay & classification police

Driving Change

o Need for market competitivenesso Organizational changes

o Flatter structureo Span of control initiative

o Need for more pay plan flexibility and simplicity o Broadly titled jobs allow flexibility in job

assignments o Smaller staff in HR to monitor pay actions and

maintain numerous classificationso Departments wanted more autonomy in pay issues

Residual Issues

o Step mentality alive & wello Longevity & loyalty strongly valuedo Assumption: long tenure = good performance

o Pay grade = statuso Classification system used to “reward” employees

with upgrades

o Learning about pay for performance:o Supervisors hesitant to be honest with

employees about poor performance issueso Performance pay not successfully tied to

actual performance

First Step: Consolidate Pay Plans

o Consolidation of five civilian pay plans into one

o Implementation of $10/hour minimum wage

o Big change!o Ugly, but a start

o Inappropriate overlap between gradeso Compression

Next Step: Separate the Next Step: Separate the Grades from the TitlesGrades from the Titles

Title/Grade Title

Grade

Clerk 35

Clerk 36

Clerk 37

Human Resources Analyst 55

Clerk I

Clerk II

Clerk III

Senior HR Analyst

_________________

_________________

_________________

___

75

76

77

83

o Job titles separated from pay grades

o Roman numerals and/or senior designates levels

Next Step: Fix the Salary Structure

o Old Structure

o 25 levels

o Inconsistent percentages between minimum and maximum

o Inconsistent percentages between grades

New Structure

o 20 levelso Consistent range

spread of 65% o Consistent differential

between grades of 10%

o Use of alphabetic designation instead of numeric

75

72

71

Maximum

MidpointMinimum

74

4%21%27,78725,36522,94373

6%45%33,23928,09122,943

15%12%25,61824,28122,943

30%23,89721,12618,356

5%32%30,20926,57622,943

Grade

Annual AnnualAnnual% Min

to Max% Between Midpoints

Old Pay StructureOld Pay Structure

E

B

A

Maximum

MidpointMinimum

D

10%65% $37,770$30,331$22,891C

10%65%$45,702$36,700$27,698

10%65%$34,337$27,573$20,810

65%$27,471$22,060$16,649

10%65%$41,547$33,364$25,180

New Grade Annual AnnualAnnual

% Min to Max

% Between Midpoints

New Pay StructureNew Pay Structure

Problems:

o Over 950 classifications

o Many single-incumbent titles

o Descriptions narrow in scope

o Difficult to maintain

o Too much emphasis on internal equity

And Then-the Classifications

o

o Consolidate jobs to allow more flexibility

o Emphasize pay, not title or grade level

o Allows movement of employees within departments to meet work level needs

oShrinking budgets & staff

oLevel of service demand remains constant

Classification Solutions

o ManagersoSupervisorsoInspectorsoLaborer/maintenance titlesoCustomer service titlesoOffice/clericaloExecutives

o Classification reduction: 950 to 450

o Title Consolidations:

Changes to the Classification System

Change Methodology

o Considered:o Common elements with other jobs o Similarity of basic qualifications with other titleso Organizational structure around this jobo Appropriate pay grade for the jobo Median pay for this jobo Cost of the consolidation

Change Methodology con’t

o Worked closely with customer departments to meet organization’s needso HR team met with every department’s executive

teamo Discussed proposed consolidations o Made revisions as needed

o Buy-in from City Manager and executive teamo Ultimate decisions on some titles made by Ultimate

Compensation Manager (aka City Manager)

Impact & Issues

o Employees o Below minimum of new range received salary increaseo Above maximum of new range had no change to pay for

two years

o Costo Civil Service

o Created changes to minimum qualificationso Developed subsets of broad classifications Consider impact on Reduction in Force procedures

Collective bargaining agreements/unions

Lessons Learned

o Start earlyo Work with client departments and civil service

systemo Communicate, communicate, communicate

o Employeeso Management o Not the same message to all!

o Be prepared for grade level envyo Keep an eye on the cost

Ongoing Issues

o Municipalities very comfortable with old-style compensation plans: resistance to change

o Conflict with:o Efforts to combine market sensitivity with pay for

performanceo Pressure to emulate private sector

o Training management on compensation issues o Creating freedom with fences o Some departments love the freedom, some don’t

Ongoing Issues

o Success in tying performance pay to actual performance

o Developing HR's role as partners with client departmentso Eliminate barriers we created ourselveso Frame salary management issues as a

function of budget, not control

Question and Answer SessionQuestion and Answer Session

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