Phase Two Implementation Procedures
The Negotiated Salary Trial Program (“NSTP”) is a flexible compensation program that allows eligible ladder and in-residence faculty to voluntarily contribute external funding resources toward their total UC salary. The program began its five-year pilot trial in 2013, and will move into an extended phase upon completion of the initial trial. The second phase of the trial will run from July 1, 2018 through June 30, 2022, with fiscal year 2022-2023 as a wind-down year, should the program be terminated or transitioned to a policy-based compensation program.
The NSTP, like the well-established Health Sciences Compensation Plan, utilizes external fund sources to support negotiated, non-base-building salary increments for participating faculty, providing incentives to generate additional non-state funding and rewarding academic achievement. The NSTP will not place any additional burden on the UC Retirement Plan (UCRP).
Participants in the NSTP will remain subject to the requirements of other University policies including, but not limited to, Conflict of Interest, Conflict of Commitment, Faculty Code of Conduct, and policies requiring submission of proposals and receipt of awards for grants and contracts through the University. External consulting and other externally compensated activities will be permitted in accordance with APM 025.
A. Except for the categories of faculty listed in subsection B of this section, the NSTP is available to all ladder and in-residence faculty who meet the eligibility criteria set forth in subsection C of this section while holding at least half-time appointments in a participating school or division.
B. The following faculty are not eligible to participate in the NSTP:
1. Full-time deans and faculty administrators listed in APM 240 and APM 246;
2. Senior Management Group (SMG) members;
3. Faculty members appointed in a Health Sciences department and eligible to participate in the Health Sciences Compensation Plan.
C. Faculty participating in the NSTP must be in good standing according to the following criteria:
1. Advancement in rank or step at the last academic review, or equivalent satisfactory review;
2. Fulfillment of the approved teaching load;
3. Fulfillment of research support responsibilities, including current and incoming students, tuition, benefits, and post-docs;
4. Fulfillment of University service commensurate with rank and step;
5. All research contracts and grants are in good standing (e.g., no outstanding agency reports or accounts in deficit);
6. Compliance with all applicable University policies, procedures, and reporting and training requirements, including Patent Agreement, Sexual Violence and Sexual Harassment Prevention Training, Outside Professional Activities, and Lab Safety Training.
II. Allowable Funding
A. Allowable funding is external funding that the faculty member has access to due to his or her research, teaching, or outreach activities. Discretionary funds located in the department, school, or college cannot be substituted for external funds in support of the program.
B. Only external funding can be used to support this program. External funding refers to any fund sources that are non-State-appropriated general funds or student tuition funds, including but not limited to endowment or gift income, professional degree fees, self-supporting degree fees, royalties, licensing fees, and contract and grant support.
C. A start-up package in inter-campus recruitment cannot include funds to support a negotiated salary component.
D. Funding for the negotiated salary component (hereafter “NSC”) provided under the NSTP must be awarded and in hand prior to June 30 of the current fiscal year in order to be considered for the negotiation.
E. Adequate external funding must be available for the entire year of the proposal, without exception.
F. Funds awarded after the salary increment has been negotiated may be considered eligible compensation for the following fiscal year.
G. Funding for the NSC must have a stable source, paid in accordance with any related fund source restrictions, and must be sufficient to include the related benefit costs.
H. All charges to contracts and grants must be compliant with Office of Management and Budget (OMB) Circular A-21. Effort for salaries charged to sponsored projects funded by federal sources must be accurately and appropriately calculated and certified. At no time may effort exceed 100%.
I. When federal projects are involved, the program must be compliant with Federal Uniform Guidance regulations at 2 CFR 200, “Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards.”
III. Compensation Components
A. Scale-Based Salary. Participating faculty will receive their scale-based salary in addition to an optional negotiated component. The scale-based salary is an individual’s regular scale salary rate (academic or fiscal) plus any off-scale as approved at the time of hire or as a result of a retention offer or regular academic review. The scale-based salary is considered covered compensation under the UCRP up to the amount permissible by Internal Revenue Service Code provisions and in accordance with UCRP policy and provisions. The scale-based salary will not be permanently affected (neither increased nor decreased) as a result of participating in this program.
B. Negotiated Salary Component (NSC). A negotiated salary component beyond scale-based salary may be negotiated annually and has a cap of 30% of the scale-based salary. The NSC is not considered covered compensation under the UCRP.
C. Total UC Salary (TUCS). The total UC salary consists of the participant’s scale-based salary plus the NSC.
D. Summer Salary. Faculty on academic year appointments remain eligible for three-ninths additional summer compensation for research, teaching, and/or administrative service, and must maximize summer ninth opportunities before utilizing the NSTP.
1. Summer ninths shall be paid at the total UC salary rate. Any portion of a ninth paid for service in June shall be based upon the individual’s salary in effect on June 30. If summer salary compensation is based on the academic year salary, Summer Session teaching compensation will be based upon the TUCS rate in effect on June 30 of the calendar year in which the Summer Session begins.
2. Summer salaries may come from both internal and external fund sources, and are not covered compensation under the UCRP, although a special Defined Contribution benefit applies.
3. All applicable Federal policies remain in effect for NSTP participants. For example, a maximum of 2/9ths summer salary or the equivalent amount of academic year salary may be charged to NSF grants. Agency (e.g., NIH) salary caps must be observed, and state funds may not be used to pay the cap gap.
E. Administrative Stipend. A participant in the NSTP may receive an administrative stipend, in accordance with established campus policy; however, stipends issued for official administrative roles may not be included in the NSC and must be recorded as separate payments. Administrative stipends may come from both internal and external fund sources, and are covered compensation under the UCRP.
IV. Participation Effective Dates
A. The first effective date of the NSTP Phase Two will be July 1, 2018.
B. The systemwide Provost may suspend the systemwide trial program on June 30 of any year. The Executive Vice Chancellor may suspend the NSTP for some or all Schools or Divisions on June 30 of any year.
C. The TUCS rate will be effective July 1 through June 30.
D. Newly hired faculty with mid-year start dates may participate from the appointment begin date through June 30.
E. The TUCS may not be changed for any reason, including but not limited to mid-year salary scale adjustments, retroactive merit increases, or the receipt of additional contract and grant funds. Salary negotiated as part of a retention offer shall become effective on July 1 of the following year. If a participant’s salary is raised effective October 1 (or any date other than July 1) due to a general range adjustment or COLA, the NSC will be adjusted downward while the covered compensation goes up so that TUCS remains unchanged for the fiscal year.
F. Early withdrawal from the NSTP is allowed only upon separation or retirement from the University, or as a result of an official disciplinary action as described in APM 015 and 016 and Senate Bylaw 230, or upon appointment to an ineligible administrative appointment.
G. Retroactive participation is not permitted.
V. Leaves of Absence
A. Sabbatical leave and other leaves with pay may be taken by NSTP participants in accordance with established campus policies, and will be granted at the TUCS rate in effect during the period of the leave.
B. State funds may be used only for the portion of a leave related to a faculty member’s scale-based salary.
C. If external fund restrictions preclude payment of medical leave, the department must provide appropriate unrestricted, non-state funds to ensure full payment of the TUCS.
D. The campus is under no obligation to continue the NSC if a medical leave continues into the next salary negotiation cycle (7/1 to 6/30).
VI. Intercampus Transfers
A. Temporary intercampus appointments, including Faculty Consultant payments, will be based on the TUCS rate in effect during the temporary appointment.
B. For permanent intercampus transfers, APM 510 applies. The NSC may not be a factor in determining a competing UC offer (see Appendix A in APM 510). If the new campus is participating in the NSTP, the faculty member must negotiate a new proposal with his/her new campus. Intercampus start-up funds cannot be used to support a negotiated salary component.
VII. Teaching Overload
If any portion of the NSC is based on overload teaching in a self-supporting UC program, the appropriate number of consulting days must be forfeited in accordance with APM 025.
VIII. Proposal Submission Process
A. All eligible faculty, as defined in Section I, will receive a copy of these implementation procedures as well as other related documents, including the UC Basic Program Document (Appendix A), UCLA NSTP Approval and Appeal Process (Appendix B), and UCLA NSTP Compensation Request Form.
B. No later than April of each year a call will be issued to eligible faculty by their respective home departments regarding the annual negotiation for the coming fiscal year.
C. Prior to submission of a proposal, the faculty member must verify the proposed funding source(s) with the appropriate campus Fund Manager/Department Business Officer. The Fund Manager/ Department Business Officer will confirm that the funding source(s) is allowable and that it will remain in place for the entire fiscal year.
D. After funding has been verified by the Fund Manager/Department Business Officer, the participating faculty member should submit the Compensation Request Form to the Chair no later than May 15.
E. Continuing participation in the NSTP must be renegotiated, evaluated by the Chair and Dean, and approved by the EVC each year. Renewals are not automatic.
IX. Evaluation of Proposals
A. The Chair and the department business office will review the proposal to ensure that:
1. The requesting faculty member meets the good standing requirements of Section I. C;
2. The TUCS requested is consistent with these rules;
3. Allowable and appropriate resources are available to support the proposal, including the contingency fund requirement (if any), NIH salary cap gap, graduate student support, salary threshold levels, and research equipment.
B. The Chair will review the proposals and forward recommended proposals with his or her signature to the Dean before June 15.
C. The Dean will review the proposals and forward recommended proposals with her or his signature to the Vice Chancellor, Academic Personnel (VCAP) no later than July 31.
D. The VCAP will make a final decision and inform the Dean of approved proposals no later than August 31. CAP will receive a report of the actions.
E. If the VCAP approves the proposal, the Chair will send a salary confirmation letter to the faculty member confirming the faculty member’s total salary (TUCS plus any additional compensation) for the coming fiscal year. Notification of approved participation will be sent to the faculty member, Dean, and MSO.
F. If the Chair does not recommend a faculty member’s proposal, the following process shall be followed:
1. The Chair should meet with the faculty member to see if a mutually agreeable solution can be reached.
2. If the Chair does not recommend a proposal because a faculty member does not have sufficient funding, the Chair will inform the Dean and the Dean will review. If the Dean concurs, the Dean will communicate the finding to the faculty member and provide the faculty member an explanation. If the funding requirements can be reached prior to the annual deadlines, a proposal may be resubmitted.
3. If the Chair does not recommend a proposal because the faculty member does not meet the minimum good standing criteria set forth in Section I. C, the Chair will inform the Dean. If the Dean concurs, the Dean will forward the faculty member's proposal along with the Chair’s assessment and the Dean’s assessment to the VCAP. Upon receipt of the appeal, the VCAP will appoint an ad hoc NSTP Joint Faculty/Administrative Committee (FAC) comprised of 2-3 faculty members and 2-3 administrators. The FAC will review the appeal package and provide a recommendation to the VCAP within 14 days of receipt of the appeal. The VCAP will make a final decision and inform the Dean of the outcome of the decision within 7 days of receipt of FAC recommendation.
G. Approved proposals will be documented in writing and signed by the faculty member, Chair, Dean, and EVC.
X. Financial Responsibility
A. The Dean or his/her designee is responsible for managing funding of the NSTP and will cover a participant’s TUCS for the entire fiscal year period (7/1 to 6/30), even if the faculty member loses funding during the annual negotiated year period.
B. The Dean may establish a contingency fund at a designated percentage rate to ensure coverage of TUCS obligations.
1. Where applicable, the contingency fund will be built via participating faculty members’ supporting part of their base-salary on non-state sources. Faculty members participating in the NSTP may be required to release base-salary equal to a percentage of the NSC as determined by the Dean for all NSTP participants in the respective School or Division.
2. Where applicable, the contingency fund account minimum balance will be set by the Dean or his/her designee. If accumulations fall below this level, an increase in contribution rates or a transfer of non-state-appropriated general funds will be required to bring the balance to the required level.
3. Where applicable, use of any contingency fund surplus will be discussed with the School’s or Division’s Faculty Executive Committee, and approved by the Dean and the Executive Vice Chancellor.
4. Where applicable, contingency fund accumulations and expenditures shall be reported annually to the Executive Vice Chancellor, including the consultation that occurred regarding the use of funds.
XI. Reporting to UCOP
The Executive Vice Chancellor is responsible for reporting on campus participation in the Trial Program to the Systemwide Provost annually.
Last update April 17, 2018