The financial health of WUMS is threatened both by the prospect of decreasing income and from increasing commitments beyond its control. Dynamic changes in clinical and academic medicine are placing new constraints on clinical revenue and on research funding. The recent repeal of mandatory retirement substantially increases the financial liability to WUMS, along with the increasing size and complexity of the faculty (both tenured and non-tenured).
Resource depletion already has threatened the tenure system at sister institutions. In order to protect the tenure system at WUMS and at the same time maintain flexibility for renewal, the Executive Faculty has approved a flexible, productivity-based pay policy, which will ultimately be beneficial to both the Medical School and individual faculty.
II. The Plan
The plan is designed to satisfy tenure requirements and also reward those faculty members who maintain excellence in their clinical and academic (teaching and research) performance. The plan is designed to ensure a fair and balanced salary distribution for Medical School faculty that is increasingly heterogeneous in function, expertise and responsibilities. Fundamentals of the plan are:
- Each faculty member covered by the policy will have a base salary that is established for each academic rank, regardless of clinical, research, teaching, or combined activities of the faculty member. The base salary figure computed for a faculty member for any one year represents the minimum compensation that will be paid to the faculty member that year. Each department will establish department-specific base salaries, using a fixed formula that is based on appropriately specified faculty categories taken from the most recently published AAMC salary data. For all departments, there will be an absolute floor of $55,000 for Associate Professors and $70,000 for Full Professors. For Assistant Professors, the base salary will be established by the department head at the time of hiring, or for existing Assistant Professors within three years of the time of implementation of this policy.
- The base salary will apply to investigator track faculty in all departments, as well as to new clinician track faculty contracts, and will not be subject to reduction.
- The base salary can be supplemented as determined by criteria developed by each department. These criteria will depend upon academic performance, clinical, teaching and research activities, and other contributions and considerations as determined by the department head. The supplement can take the form of a prospective annual commitment, or a “bonus”, or both. Supplemental salary in excess of the base salary will be subject to increase or decrease in accordance with departmental plan criteria.
- University fringe benefits can be calculated on the total prospective annual salary (base plus variable supplement), only the base, or the base plus a portion of the supplement, according to the departmental plan specifications. Fringe benefits will not be calculated on a bonus.
III. Departmental Plans
The committee recommended that the following general principles be included in departmental plans:
- The plan should have certain standards, consistent throughout the Medical School, should be communicated to the faculty, and should provide details that are specific to each department.
- The school-wide principles for each departmental plan should include a regular (usually annual) review for each faculty member, any limits to annual salary reductions, and a periodic review of the department’s plan. The productivity measurements for a department should be related to the school and departmental mission – including clinical, research, teaching and administrative standards.
- Each department’s plan should be in writing, be reviewed by the Administration and Finance Committee of the Executive Faculty and the University’s legal counsel, and be approved by the Dean.
- The written plans should indicate that the department head remains responsible for faculty assessment and remuneration with appropriate flexibility to meet this responsibility.
- Recognizing that even the best plans create questions, we recommend that the Dean appoint a Medical School committee on an ad hoc basis to review each specific faculty compensation complaint that may arise. These compensation review committees should have a standard procedure of review, as approved by the Executive Faculty.
Recognizing that this plan will be a major change from the current practice, the committee recommends a two-phase program: implementation for new faculty immediately after plan adoption and implementation for current faculty within 3 years after plan adoption. Department plans should be developed, approved and adopted no later than 6/30/98. Current faculty should receive adequate notice about the plan, its objectives and operating principles, and have ample opportunity for review. If a department head determines that current faculty compensation should be reduced during this 3-year notice period, a maximum of 5% per year will be allowable.1 The Executive Faculty should approve action to require departments to develop their plans within one year. The committee also recommended that the Clinical Affairs Committee of the Executive Faculty consider the development of a medical school practice plan.
1 A department’s plan may be exempted from the transition requirement where it is demonstrated that a compensation plan consistent with the fundamentals and principles outlined in this report have been in effect and fully implemented by the department, i.e., that the plan called for in this report will not represent a significant change in compensation policy or practice for the department.
Approved by Executive Faculty 11/96