The BestPractices Guide to Job Leveling About Jennifer

The Best-Practices Guide to Job Leveling About Jennifer Peacock SRA Director of Compensation Headshot v 20 years of experience in Human Resources v 12 years in a government contracting environment v 9 years in a consulting capacity – Compensation, Benefits, Recruitment v 3 major compensation plan redesigns & implementations v 4 large-scale, significant benefit change implementations

The Best Practices Guide to Job Leveling with Jennifer Peacock, Compensation Director at SRA International

Agenda • • Definition Benefits Reasons for Undergoing a Job Leveling Exercise SRA Rationale SRA Process Value Tips Questions

What is Job Leveling? • Analytical process to determine the value of jobs in an organization • Foundation for reward and talent management programs • Means of communicating career paths, facilitating talent mobility, and delivering competitive rewards • Addresses business needs: – attraction, engagement, and retention of key talent – cost and risk management – governance

Benefits of Job Leveling • Alignment with business needs and strategy • Common language for career paths, job requirements, and performance expectations • Linkages to organizational competencies • Consistent mapping of jobs to external market data • Contributes to cost-efficient talent and reward programs and delivery • Ensure internal equity • Compliance – government contractors

Reasons for Job Leveling • Aligns jobs located in multiple regions or across different business areas • Creates a framework that integrates employees after a merger, acquisition, or other structural change • Drives consistency, competitiveness, and efficiency among Compensation policies and practices • Clarifies levels to support career development

SRA Rationale • • Foundation for our new compensation structure Alignment across the organization Clear career paths Compliance

The Evolution of Job Codes at SRA: Past, Present, & Future Prior to 2010 • 700 job codes • Created as needed • Variable and limited content • Limited accessibility • Limited search capabilities 2011 - 2012 • 1, 596 job codes • Leveling Tool created, ad hoc for other jobs • Limited differentiation between levels • Enhanced accessibility on portal and Brass Ring • Improved search capabilities 2013 & Forward • 500 -700 job codes, linked to market data • Comprehensive database of all descriptions • Standardized, comprehensive with leveling competency content • 24/7 online access with extensive search and comparability capabilities

Process • • • Create job descriptions – job titles Evaluate jobs - grades Develop job families/job tracks Engage your managers in the process Create salary ranges Communicate the program Job Evaluation Project Planning Grade Assignments Job Documentation Benchmarking Salary Structures Implementation

Job Descriptions • Best job descriptions are living, breathing documents that are updated as responsibilities change. They do not limit employees, but rather, cause them to stretch their experience, grow their skills, and develop their ability to contribute within their organization. • SRA Job descriptions include: – Grade – FLSA classification – Job summary – Responsibilities/duties – Qualifications – Experience – Education – Working conditions

HRTMS: Manager/Employee View

HRTMS: Job Description

HRTMS: Jobs Under Review

Grades • Determined by the level a position is at in the organization – Software applications – Salary surveys – Internal equity • Employees in the same grade are considered peers in the organization – at the same level • Employees in the same grade are compensated in the same pay range

Grades - GGS • GGS = Global Grading System – – A job hierarchy structure The methodology to assess jobs against it Software to facilitate the process Globally acceptable, yet culturally neutral • 3 basic steps – Business scope (revenue, # employees, geographical scope, diversity/complexity of products & services – Job banding (dual career ladder, reflect banding rationale) – Job grading (functional knowledge, business expertise, leadership, problem solving, nature of impact, area of impact, interpersonal skills)

GGS Structure Role Contribution Band Expertise 3 M * Leadership 4 M * Grade 1 2 3 4 5 6 7 8 9 10 11 12 13 Strategy 5 FS * 5 BS * 14 15 Management Career Path 16 17 Top 18 Grade 19 1 st Line Top Mgmt Middle Management Supervisor 20 Top Mgt Role Contribution Band Tasks Expertise 1 3 IC * Skill Leadership 2 4 IC * Grade 1 2 3 4 5 6 7 Individual Contributor Career Path Manual Worker 8 10 Technician 11 12 13 14 15 16 Subject Matter Experts Professional Clerical/Admin 9 17 18 Grade 19 20 * FS = Functional Strategy, BS = Business Strategy, M = Management, IC = Individual Contributor (Technical Career) Top

GGS: Determine Grade • Factor definition levels – concentration on nature of contribution and complexity of tasks – – – – Functional knowledge – knowledge of work and activities Business expertise – knowledge and expertise about the business Leadership – guidance to others Problem solving – mental skills required and complexity Nature of impact – how the job impacts the business Area of impact – where the impact will be felt Interpersonal skills – people skills • Grade the ROLE, not the INCUMBENT • Assess worth of role based on positive aspects • Assumes tasks and responsibilities being performed at optimum level

GGS: Job Banding Evaluation

GGS: Job Grade Evaluation

GGS – HRTMS – Job Descriptions • New job descriptions have the factor (job level) information built-in • When creating new job descriptions, a series of responses to determine the level of the factor are required • Those answers are entered into GGS to assist in determining the SRA grade

Compensation Structure Job Family A broad functional area used for organizing jobs into useful categories for job maintenance, compensation planning, performance management, and competency modeling. Job Track A set of jobs that share a high degree of similarity, but differ in terms of levels of expertise and expectations. Job Title/Job Code The job title is a brief description of a position held by an employee. The job code is a shortened version of the job title used in HR systems. Grade A system used to group jobs together that have approximately the same relative internal worth (peers) and are paid in the same range. Salary Range The range of compensation associated with a grade that is tied to the market.

J o b T r a c k Grade Job Family Sample: Compensation Program Refinement Update Engineering - Core Job Family Civil Electrical Energy Environmental Mechanical 20 19 18 17 16 15 14 13 12 11 J o b T i t l e Peers Master - Energy Engineering Senior Civil Engineer Senior Electrical Engineer Senior Energy Engineer Senior Mechanical Engineer 10 9 Civil Engineer Electrical Engineer Energy Engineer Environmental Engineer Mechanical Engineer 8 7 Associate Electrical Engineer Associate Energy Engineer Associate Environmental Engineer Associate Mechanical Engineer 6 5 4 3 Salary Range (associated with each Grade) 2 1

HRTMS: Job Description Matrix Explorer

Salary Ranges • Salary Range: the range of pay, which has a minimum, midpoint, and a maximum, paid for working at a certain job and at a certain level within a grade at an organization; the salary paid to the employee will change according to performance, time spent at the job, etc. , but any changes will fall within the allocated salary range. • Market Rate: the usual salary a company is willing to pay for a job in the market.

Sample Grade/ Salary Range Structure GG Min Mid Max Midpoint Diff Spread 20 $0 $0 $0 0% 19 $197, 150 $300, 000 $402, 850 104% 18 $167, 600 $255, 000 $342, 400 -15% 104% 17 $119, 000 $178, 500 $238, 000 -30% 100% 16 $95, 200 $142, 816 $190, 450 -20% 100% 15 $80, 900 $121, 393 $161, 900 -15% 100% 14 $68, 750 $103, 184 $137, 650 -15% 100% 13 $61, 350 $90, 802 $120, 300 -12% 96% 12 $52, 750 $78, 090 $103, 450 -14% 96% 11 $45, 350 $67, 157 $89, 000 -14% 96% 10 $40, 400 $59, 098 $77, 800 -12% 9 $35, 550 $52, 007 $68, 500 -12% 92% 8 $31, 300 $45, 766 $60, 250 -12% 92% 7 $29, 050 $41, 189 $53, 350 -10% 83% 6 $26, 150 $37, 070 $48, 000 -10% 83% 5 $23, 550 $33, 363 $43, 200 -10% 83% 4 $21, 750 $30, 047 $38, 350 -10% 76% 3 $19, 600 $27, 047 $34, 500 -10% 76% 2 $17, 650 $24, 358 $31, 100 -10% 76% 1 $15, 850 $21, 922 $28, 000 -10% 76%

Utilization of Salary Ranges • An employee just beginning a new job would start near the minimum and move towards the maximum as he/she becomes fully functioning in the job • Salary ranges overlap to allow for equity between an inexperienced employee in a higher grade to be paid at the same level as an experienced employee in a lower grade Grade 1 Minimum: $15, 850 Midpoint: $21, 922 Maximum: $28, 000 Grade 2 Minimum: $17, 650 Midpoint: $24, 358 Maximum: $31, 100 Grade 3 Minimum: $19, 600 Midpoint: $27, 047 Maximum: $34, 500

Communication • • Develop a communication plan Engage senior leadership Take time to develop your message(s) Use a tiered approach to communication

Gameboard CURRENT STATE— Where are we now? • Inconsistent approach to compensation, job codes, promotion, and titling • Base compensation decisions on individual circumstances vs. external factors • Do not consistently consider longer term and broader implications of individual salary decisions • Need to strengthen our ability to defend in an audit • Inconsistent process means managers must spend too much time on HR related transactions • Employees are confused about our compensation system …and in some cases question the fairness • Managers make decisions and look to HR to process the transaction • HR is not consistently viewed as a partner with business on compensation related decisions • The Comp project has encountered resistance, but then evolved to acceptance CASE FOR CHANGE— Why should we change? • Deliver on our commitment to provide fair and competitive compensation • Strengthen our ability to deliver competitive bids well into the future • Reduce risk of non-compliance with DCAA regulations regarding fair compensation • Respond to concerns raised in the Employee Engagement survey • SRA has a competitive, comprehensive program for compensation FUTURE STATE— • Improved confidence and conviction of market rates for both employee Where do we want to be? compensation and for bidding new work • Improved data accuracy for strategic analysis of compensation pay practices • Reduced turnaround time for job postings and offers of employment • Efficiencies in the merit process and drive a stronger correlation to performance and market • Managers are equipped with the information to make good compensation decisions in partnership with HR • Employees are clear on their job tracks, level, titles, responsibilities , and the associated compensation • Greater understanding around the whole comp philosophy and how rewards and recognition play a role, in addition to base salary increases • Compliant with both state and federal regulations (in coordination with Legal) • HR partners with business supports managers in providing outstanding people management STRATEGIC INITIATIVES— BARRIERS— How will we get there? • Implement an education campaign on what a mature compensation program looks like and its importance to growing, competing for talent, and staying compliant with gov’t regulations • Generate significant buy-in through a series of meetings with leadership on jobs and people What could make this hard? • • Lack of broad understanding of the importance of having a more robust compensation program Resistance from managers A weak partnership between business and HR Perception that cutting costs is a driver of this project

Communication Plan SITUATION ANALYSIS • Inconsistent approach to compensation, job codes, promotion, and titling • Base compensation decisions on individual circumstances vs. external factors • Do not consistently consider longer term and broader implications of individual salary decisions • Need to strengthen our ability to defend in an audit • Inconsistent process means managers must spend too much time on HR related transactions • Employees are confused about our compensation system …and in some cases question the fairness • Managers make decisions and look to HR to process the transaction • HR is not consistently viewed as a partner with business on compensation related decisions • The Compensation Project has encountered resistance, but then evolved to acceptance COMMUNICATION OBJECTIVES • Implement an education campaign on what a mature compensation program looks like and its importance to growing, competing for talent, and staying compliant with government regulations • Generate significant buy-in through a series of meetings with leadership on jobs and people • Spend time educating the organization on what a compensation structure program looks like OPPORTUNITIES AND CHALLENGES • Opportunities: • • Deliver on our commitment to provide fair and competitive compensation Strengthen our ability to deliver competitive bids well into the future Reduce risk of non-compliance with DCAA regulations regarding fair compensation Respond to concerns raised in the Employee Engagement survey • Challenges: • • • Lack of broad understanding of the importance of having a more robust compensation program Resistance from managers A weak partnership between business and HR KEY MESSAGES • SRA has a competitive, comprehensive program for compensation • Improved confidence and conviction of market rates for both employee compensation and for bidding new work • Improved data accuracy for strategic analysis of compensation pay practices • Reduced turnaround time for job postings and offers of employment • Efficiencies in the merit process and drive a stronger correlation to performance and market • Managers are equipped with the information to make good compensation decisions in partnership with HR • Employees are clear on their job tracks, level, titles, responsibilities , and the associated compensation • Greater understanding around the whole comp philosophy and how rewards and recognition play a role, in addition to base salary increases • Compliant with both state and federal regulations (in coordination with Legal) • HR partners with business and supports managers in providing outstanding people management APPROACH • Use a tiered approach at communications • Senior Leadership → Group Leadership → Management → Employees • Gain active support from managers • Provide tools that help managers understand the new compensation program • Prepare managers to answer questions from their employees • Provide clear instructions • Keep communications simple, straightforward and direct • Educate management and employees on the new program and structure • Use different forms of media • • • Portal Email Web Meetings Newsletter Manager calls • Listen and respond to feedback • Capture ongoing feedback from managers and employees

Communication Timeline Feb. 18 Feb. 21 Feb. 25 Feb. 28 March 4 Week of March 11 Week of March 18 • Letter sent to Senior Leadership via email • Project Overview/Web. Ex session invite letter sent to Managers • Senior Leadership presentation • Communication kits sent to Senior Leadership (Manager letter, Employee Compensation Statement, FAQs) • Project Overview/Web. Ex sessions invite letter sent to Employees • Communication kits sent to Managers (Manager letter, Employee Compensation Statement, FAQs) • Manager Web. Ex sessions • Employee Compensation Statements sent

The SRA Solution • Created more detailed job descriptions that were reviewed and edited by managers • Evaluated all SRA jobs against the market • Created a logical compensation structure that was reviewed and “tweaked” by leadership • Mapped employees to the new structure utilizing the management team • Educated leadership, management, and employees on the new structure and program to ensure that it is understood • Outlined career development paths in a visual way that managers can utilize and employees can access

What is the Value of Job Leveling? • Compliance • Fair compensation practices • Career development

Compliance • Compensation plays a large role in ensuring SRA is compliant with EEOC, OFCCP, and the DCAA – Fair pay practices are a focus • Compensation’s role in audits – – Provide employee data Provide policies/practices documentation Defend practices Be available for interviews

Job Qualifications vs. Employee Skillset • SRA pays for the job duties, not the skills and expertise of the employee/candidate • Example – Senior Software Engineer with 20 years experience and an MBA making $105, 000 – Mc. Donald’s has an opening for a cashier requiring a HS diploma and no experience – SSE applies for cashier job at Mc. Donald’s – Mc. Donald’s offers SSE $8/hour – Mc. Donald’s job does not require 20 years of engineering experience and an MBA

Benefits to Employees Clear career development choices available Job title maps to current market rates Accurate job title Job title reflects duties being performed

Tips • Senior management support • Manager engagement and support throughout the process • Clearly defined process • Well thought out communication plan • Education for the entire organization • Don’t cut corners • Build extra time into the schedule

Questions

How To Contact Us Ashley Robinson ashley@hrtms. com Don Berman don@hrtms. com 919. 351. JOBS (5627) www. hrtms. com