Faculty Market-Based Compensation
University of Idaho uses a market-based compensation system for its employees. This system was implemented for employees in 2018 and was developed in partnership with employees in the years leading up to the implementation.
The faculty salary model was developed by the Faculty Compensation Task Force which consisted of 16 members, 13 voting and 3 ex officio; one faculty member from each academic college and one from faculty-at-large, the Faculty Secretary, the Vice President of Finance and Administration, the Vice Provost for Faculty (ex officio), the Director of Institutional Effectiveness and Accreditation (ex officio), and a representative from the Provost’s Office (ex officio). The Faculty Compensation Task Force was co-chaired by Patrick Hrdlicka (Professor of Chemistry) and Wesley Matthews (Executive Director of Human Resources).
The salary model defined U of I’s institutional peer group (market), selected suitable salary databases for salary data, and provided guiding principles for the effort. The goals during the start of the project in Fall 2015 were the following:
- increase employee salaries to 100 percent of market (on average) by 2025
- develop and deploy a data-driven, objective and transparent market-based compensation system.
Current Annual Market-Based Compensation Resources
- FY25 Faculty Salary Table (Excel)
- FY Post Doc Salary Guideline (PDF)
- Longevity Table (PDF)
- FY25 Salary Calculator
What does “market-based compensation” mean?
Market-based compensation is a compensation model that establishes a market rate based on the average salary reported in the reference database for a specific Classification of Instructional Programs designation (CIP)/rank combination within U of I’s institutional salary comparison group. The target salary is calculated taking several fixed measures into account. A faculty member’s actual salary may be below, equal to, or exceed their target salary.
U of I’s institutional salary comparison group, henceforth also referred to as ‘the market’, encompasses all U.S. public and private doctorate-granting institutions. It includes R1, R2 and R3 institutions as defined by the Carnegie classification framework.
Inclusion of R1 and R3 institutions in the institutional salary comparison group provides a more robust salary dataset than using only salary data from R2 institutions. A preliminary analysis revealed that market salaries, on average, were similar for the R1/R2/R3 vs R2-only datasets.
U of I is currently an R2 institution. Using an R1 or R1/R2 salary comparison group was not deemed a politically or financially viable option at the time. However, the Faculty Compensation Task Force recommended that the institutional salary comparison group and/or U of I’s overall salary goal be reevaluated and adjusted as the institution moves closer toward realizing its aspirational R1 goal and/or overall salary goal.
What is U of I’s institutional salary comparison group?
U of I’s institutional salary comparison group, henceforth also referred to as ‘the market’, encompasses all U.S. public and private doctorate-granting institutions. It includes R1, R2 and R3 institutions as defined by the Carnegie classification framework.
U of I is currently an R2 institution. Why does U of I’s institutional salary comparison group include R3 institutions?
Inclusion of R1 and R3 institutions in the institutional salary comparison group provides a more robust salary dataset than using only salary data from R2 institutions. A preliminary analysis revealed that market salaries, on average, were similar for the R1/R2/R3 vs R2-only datasets.
Will this salary comparison change if we reach R1 status?
If U of I reaches this status, this will be a necessary review point.
Where do the funds to support salary increases come from?
Increases for positions permanently budgeted on general education sources will be supported by general education funds (i.e. state support, tuition revenue, etc.). When other sources provide whole or partial funding for a faculty position, then those other sources must provide additional funding to support salary increases. There are no additional funds that support salary increases. Increases to salaries comes from reallocation of existing resources.
Does this mean that every faculty member will be paid the market rate in their discipline?
No. Some faculty members will command salaries above market rates, while the salaries of other faculty members will be below market rates. Salaries relative to market rates depend upon many things including time in rank, tenure status and so on.
What are CIP codes?
CIP (Classification of Instructional Programs) codes are a taxonomy of academic disciplines at institutions of higher education in the United States. The CUPA-HR and OSU datasets list salary data by CIP code and academic rank.
How are CIP codes determined for faculty in academic units?
In 2017, faculty members, unit leaders and deans identified an appropriate four-digit CIP code for each faculty position. CIP codes are limited to academic degrees and programs offered within the unit at U of I. The CIP code family must be directly related to the position. In future hires, the CIP code is assigned to reflect the responsibility of the position situated within the unit and the instructional program.
CIP codes reflect the responsibility area of the position within the unit and curriculum. They do not reflect the specific disciplinary training area of an individual faculty member.
What are the differences between two-, four-, and six-digit CIP codes, and why are four-digit CIP codes used?
The two-digit series represents the most general groupings of related programs. The four-digit series represents intermediate groupings of programs that have comparable content and objectives. The six-digit series represents specific instructional programs. For example, “40” denotes Physical Sciences, “40.05” denotes Chemistry, and “40.0504” denotes Organic Chemistry. Four-digit CIP codes are used for determining market rates as a compromise between sufficient disciplinary granularity and enough data points.
How do CIP codes change?
Once established for a position, CIP codes do not change except in rare circumstances. Every ten years, the US Department of Education updates CIP codes and that may warrant a reconsideration of a CIP code assignment because the original CIP code has been dropped. Occasionally, the CIP code may have been assigned in error and so a correction is needed. In the case of new academic programs, new CIP codes may need to be assigned to the faculty who teach in the program. This process is initiated with the dean.
How do CIP codes relate to faculty salary?
Once established, the CIP code is used to determine the market rate for the faculty salary. The target rate for the faculty member is determined by other things like tenure status, rank and time in position.
Which salary databases are used to determine faculty salary?
CUPA-HR (College and University Professional Association for Human Resources) serves as the primary data source for faculty salaries. Alternative data sources (e.g., the Oklahoma State University survey; Bureau of Labor Statistics) are used with appropriate scaling factors in isolated cases (e.g., if CUPA-HR does not provide a sufficiently robust dataset for a given discipline/rank combination). CUPA-HR offers a large dataset (more than 100 universities participate), is updated annually, can be tailored according to our needs and has a user-friendly interface amenable to institution-scale applications. Market salaries — expressed as averages, medians, or percentiles — are available for most discipline/rank combinations.
These databases are updated annually and so U of I’s faculty market-based salaries are updated annually.
How are market rates determined for faculty who are not in traditional academic units (e.g. library staff, extension faculty)?
Market rates for these faculty have been determined through other data sources such as the Bureau of Labor Statistics in partnership with the appropriate leadership (usually deans or directors) from that area.
Can I access the CUPA-HR database?
The full CUPA-HR dataset is only available via subscription. However, tables with market rates for relevant CIP/rank combinations are posted above under the current year Resources. Historical information is in the archived information below.
Why do we not use salary surveys conducted by discipline-specific national organizations (e.g., American Chemical Society for chemists and chemical engineers)?
Salary surveys conducted by discipline-specific national organizations use different methodologies, which precludes a direct comparison between disciplines. In contrast, CUPA-HR is a one-stop comprehensive database which uses one sampling methodology across most disciplines.
How are administrative stipends calculated for faculty salaries?
For executive-level administrative positions, every two years, CUPA-HR updates the nationally benchmarked salaries for certain positions (deans, vice provosts, directors of counseling centers and so on). This provides the salary comparison for these positions. For department chairs and other leadership positions, the colleges establish whether they compensate faculty in these roles by a flat rate or a percentage of their faculty base salary.
I have a joint appointment. How is my CIP code determined?
Appointments that cross units or colleges are actually “buy-outs” of time from a home department. The market-based salary of the faculty member’s primary department’s CIP code is the basis for the faculty salary.
What is the difference between market rate, target salary and actual salary?
The market rate is the average salary reported in the reference database for a specific CIP/rank combination within U of I’s institutional salary comparison group. The target salary is calculated taking several fixed measures into account. A faculty member’s actual salary may be below, equal to, or exceed their target salary.
How is a faculty member’s target salary calculated?
The target salary calculation takes the following factors into account:
- The faculty member’s academic rank, CIP code and tenure status (tenured, tenure-track, or non-tenure-track)
- The market rate for a specific CIP/rank combination
- Academic year vs fiscal year appointment
- Full-time vs part-time appointment
- A longevity factor, which takes into account years of satisfactory performance in rank. Longevity tables are available in the Annual Salary Resources section.
Does the compensation model consider performance? And, if so, why is a performance factor not included in the target salary calculation?
The overall market-based compensation model for faculty also includes a significant performance component reflecting a faculty member’s performance relative to other faculty in their unit. Since performance requires an annual assessment, it is not included as a parameterized factor in the target salary calculation. Unit leaders and deans are given latitude to make recommendations on merit-based raises following the annual evaluation process, as part of the annual CEC (Change in Employee Compensation) process.
Who is eligible for merit raises?
Faculty members who have met or exceeded expectations in their annual evaluation may be eligible for a performance-based increase as part of the annual CEC process. Also, they must have completed the annual required employee training within the required timeframe it is assigned.
What is the underlying philosophy behind the longevity tables?
The longevity tables were designed to:
- Maximize our ability to recruit talent (e.g., the longevity scale starts at 90% for new assistant professors, i.e., target salaries will be close to market rates)
- Reward timely career progression (e.g., the longevity factor for assistant professors reaches its maximum following a successful third-year review; the longevity factor for associate professors reaches a maximum following five years of satisfactory performance in rank, coinciding with the first opportunity for an associate professor to be considered for promotion to full professor).
- Mimic the salary increases observed under our current promotion policy
- Minimize salary compression between ranks
- Reward institutional loyalty of productive employees (e.g., steep longevity progression for full professors, until a maximum is reached approximately mid-way through a typical career)
Why does the longevity component not extend beyond 100% of the market rate for a given CIP/rank combination?
By capping the longevity component at 100% of the market rate for specific CIP/rank combinations, funds become available for performance-based salary increases.
Why does the longevity scale start at 83% for full/distinguished professors?
Calculating the target salary of a fifth-year associate professor as 100% of the market rate for associate professors within a specific CIP and the target salary of a newly promoted full professor as 83% of the market rate for full professors within a specific CIP code, most closely mimics our current promotion policy.
Why does it take so many years of satisfactory performance for full/distinguished professors to reach a longevity factor of 100%?
The market dataset for full professors includes faculty with a very broad range of “years in rank”, from newly promoted professors to professors who have been in that rank for 30 or more years. When the compensation model was initially deployed, 17 years of satisfactory performance in rank was deemed an appropriate timeframe to reach a longevity factor of 100%. Further analysis suggested that the longevity progression should be accelerated (11 years of satisfactory performance in rank to reach a longevity factor of 100%).
Why are non-tenure track faculty assigned market rates that are a percentage of the market rate for like-rank tenure-track faculty within that CIP code?
The databases do not provide sufficiently robust discipline-specific datasets for non-tenure track faculty. When the compensation model was initially deployed, internal data supported defining the market rate of non-tenure track faculty as ~85% of the market rate of like-rank tenure-track faculty. Subsequent analysis of CUPA-HR data has shown the calculation of the market rates of non-tenure track faculty as 90% of the market rate for like-rank tenure-track faculty in the same CIP code.
Why are market rates of instructors and senior instructors linked to tenure-track associate professors in the same CIP code?
The databases do not provide enough discipline-specific responses for instructors and senior instructors. When the compensation model was initially deployed, internal data supported defining the market rates of instructors and senior instructors as ~65% and ~70% of the market rates for associate professors in the same CIP. Subsequent analysis of CUPA-HR data has provided support for this approach.
Why are instructors and senior instructors hired at 100% of their discipline-specific market rates, and why is there no longevity progression for these employees?
Offering starting salaries below the discipline-specific market rates would render the institution at a competitive disadvantage when hiring new instructors. Hence, the longevity schedule starts instructors and senior instructors at 100% of their market salary. While there is no longevity progression, these faculty are eligible for additional performance-based salary increases.
Does the compensation model reward mediocre performance?
No. Longevity progression is based on years of satisfactory performance, i.e., receiving a “3” or “meets or exceeds expectations” according to the previous and current annual evaluation process, respectively. In addition, faculty members meeting or exceeding expectations may be eligible for performance-based salary increases as part of the annual CEC process.
How will future CEC funds be distributed?
The methodology for distribution of available CEC funds will be established annually by the Office of University Budget and Planning and the Office of the Provost. Faculty and staff will be consulted regarding the distribution of these funds. Funds may be used to cover promotion and retention raises, bring salaries to a minimum level relative to target salaries, keep up with market and moving targets, reward exceptional performance, and so on. Information regarding CEC communications and processes is available in the university's salary guidelines.
Will there be across-the-board cost of living adjustments in the future?
No, unless required by the state. In principle, inflation and other cost of living adjustments should be reflected in a market-based compensation model (i.e., steadily increasing market rates).
Will there be across-the-board salary increases in the future?
Most likely not unless required by the state. The switch to a market-based compensation system enables us to award salary increases in a more data/market-informed manner.
Will promotion raises remain in place?
Yes, promotion raises will remain in place.
Current promotion increases are:
- Instructor to Senior Instructor:
Academic Year (AY) $2,500
Fiscal Year (FY) $3,050 - Assistant Professor to Associate Professor
Academic Year (AY) $6,000
Fiscal Year (FY) $7,300 - Associate Professor to Professor
Academic Year (AY) $8,500
Fiscal Year (FY) $10,300
Are faculty at risk of a salary decrease if their market rate decreases from one year to another?
No, faculty members’ salaries will not decrease if there are changes in market rates. However, the calculated target salaries might decrease, which may impact future salary decisions. To minimize spurious year-to-year fluctuations, three-year rolling averages of market rates are used.
Can I see my salary calculations on myUI?
Yes. Login to myUI then select “Administrative Tasks” and “Target Annual Pay.”
Have you conducted a salary comparison for different groups of faculty following the implementation of the compensation model?
Yes, this information is shared annually with Faculty Senate and Staff Council by members from the Office of University Budget and Planning.