Health System Pay Structure & Processes Policy

Policy Statement

Duke University Health System administers compensation policies and programs that reflect the value of job duties and responsibilities, offer competitive and equitable pay, and provide opportunities for pay growth based on available resources and performance contributions. Duke University Health System maintains a broadband pay structure of 13 bands that are based on competitive pay practices and designed to establish the range of salaries that will be paid for respective jobs within the bands.

Policy Details

• Salary Structure
• Establishing Pay Rates
• Pay Adjustments
• Premium Pay
• Standardized Pay Policy Guidelines
• Weekend Option Guidelines

Salary Structure

Salary bands are established based on competitive pay practices and are designed to establish the range of salaries that will be paid for respective jobs within the bands. Compensation within Duke Human Resources annually evaluates the external pay rates of benchmark jobs through surveys in order to establish competitive rates of pay. The bands are reviewed for appropriateness and revised to meet the objective of remaining competitive within the market. Compensation trends in the market and external economic factors – such as the Consumer Price Index and unemployment rate – as well as internal economic factors (such as the ability to pay) are also taken into consideration when establishing annual salary and structure recommendations.

Duke University Health System maintains a salary structure that consists of 13 pay bands. There is typically a 100 percent spread between the minimum and maximum of each pay band. A "market target" is defined as what the market would pay for a fully competent, experienced individual for a particular type of job. This is also known as the "market median."

Each pay band typically has three market targets. Every job within a band is assigned into one of the three targets and is based on specific work requirements and the knowledge, skill, and competency differences needed to execute the work. Each market target has a range of competitiveness typically defined as 80 percent below the market target and 120 percent above the market target. Generally, this range of competitiveness is similar to the traditional salary range minimum and maximum.

Establishing Pay Rates

Duke University Health System has established guidelines for assisting managers in determining appropriate pay rates for different situations, including:

• New Hires
• Salary Increases
• Promotions
• Demotions
• Transfers

New Hires

The new hire starting rate of pay is determined by the hiring manager. Factors to consider in determining this rate include:

• market band placement guidelines
• applicable knowledge, skills, and abilities (KSAs)
• relevant experience
• general market conditions
• other considerations (budget, legal, internal pay relationships)

For some job classifications, there are more detailed guidelines established annually. If you need assistance in establishing pay rates, reach out to your entity Human Resources representative. There may also be specific guidelines for determining annual salary increases for new hires.

Market Band Placement

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• 80 percent of the Market Target - Meets minimum requirements of the position.
• Below the Market Target - Fully qualified to perform all duties and responsibilities of the position.
• Above the Market Target - Highly experienced professional who possesses skills, competencies, and capabilities well beyond the minimum required.
• 120 percent of the Market Target - Long-term experienced professional who possesses well established skill sets and performance capabilities.

 

Applicable Knowledge, Skills and Abilities (KSAs)

The knowledge, skills, and abilities of the new individual as compared to others in the organization is essential to ensure that the staff member is paid appropriately in comparison others.

Direct Relevant Experience

Prior work experience that has provided applicable knowledge, and therefore value that is directly relevant to the work to be performed, should be counted when determining relevant work experience. Prior work experience is considered “relevant” to the staff member’s current job when the prior duties performed and the knowledge, skills and abilities gained in those prior positions are readily applicable to the job to be performed.

Experience gained in a part-time position should be pro-rated. For example, an Administrative Assistant candidate with 4 years of part-time experience prior to working at Duke as a Secretary should be credited with 2 years (50 percent) of relevant work experience.

As a guideline, experience credit may be provided for relevant education beyond the requirement for the job. One year of experience credit is typically provided for each year of education for a relevant degree beyond the education required for the job classification.  This guideline is provided to assist in translating knowledge equivalency, whether achieved through actual experience or formal education.

Indirect Relevant Experience

Prior work experience that is indirectly relevant to the work performed by the staff member in his or her job should be counted when determining total relevant work experience. Some experience is sufficiently applicable that will give 100 percent credit for the experience (as referenced in the direct experience guideline). In the case of indirect experience a 100 percent credit is not warranted. Instead, a half credit (50 percent) will be applied and added to the direct experience (i.e., a year of LPN experience would count as a half a year of Clinical Nurse experience).

Select job classifications have pre-approved Relevant Experience Guidelines.  Please reach out to your entity Human Resources representative with questions.

General Market Conditions

The rate of pay is competitive within the market. Pay should be what is required to attract, recognize, and maintain the skill sets and talent needed.

Budget, Legal and Internal Pay Relationships

Manage within budget following the business processes. Follow federal laws such as FLSA, Equal Pay Act, Age Discrimination in Employment Act, etc.

When considering the pay of a new hire either through external recruitment or a promotion, a review of the background of the new individual as compared to others in the organization is essential to ensure they are paid appropriately in comparison to each other.

Salary Increases

DUHS is committed to investing in our team members. Pay practices are consistently monitored, and we strive to ensure our practices are competitive in the market. Timing of increases may vary within the fiscal year.

Promotion

A promotion is defined as advancement to a job that requires a substantially higher level of competency or substantially different responsibilities (i.e., higher market target within a broad banded structure).

Guidelines for Promotion Pay

Promotional increases may be up to one-half the percentage difference between the market targets of the new and present jobs, whether those jobs are in the same pay band (intra-band promotion) or in different bands. For example, if the difference between the new and present market targets is 15 percent, the promotional increase should be up to 7.5 percent.

• The new pay rate should be within the range of competitiveness, as defined in the Pay Structure Features, of the new job (i.e., at least within 20 percent to 25 percent of the new market target). If the promotional increase calculation described above is not sufficient to establish a pay rate within the competitiveness range, the manager should determine a rate that does meet this level.
• Select job classifications have clinical ladders which include pre-established promotional increase amounts.  Please reference ladder documentation for information on ladder advancement increases. Please reach out to your entity Human Resources representative with questions.

Demotion

A demotion is an assignment to a lower leveled (i.e., lower market target) job that can occur for reasons initiated by the department or staff member (i.e., lower market target, such as, market target 3 to market target 2 of the same or different market bands). It should only be used if the staff member can still make a significant contribution to the organization in a new capacity. Staff members who are demoted should receive a rate within the competitive range of the lower market target commensurate with their proven qualifications. This rate generally represents a pay reduction. The new rate should neither be below the minimum nor above the maximum of the new pay band.

Guidelines for Demotion Pay

Staff should receive a rate as follows:

• If the value (market target) of the new position is at least 10 percent less than the present position, the action is to be treated as a demotion.
• The supervisor will evaluate the staff member’s performance at the time of the demotion. If the staff member has not had a performance evaluation within the last six months, the current supervisor will conduct an appraisal at the time of the demotion.
• The supervisor will determine if any pay adjustments are necessary.
• If the demoted staff member’s new pay rate is substantially above the competitive range of the new job, his/her rate should be reduced.
• If the demotion occurs within six months before the evaluation date and is a result of performance, the annual evaluation increase date may be delayed to the following year.
• If the demotion occurs within six months before the evaluation date and is for a reason other than performance, a pay increase in that evaluation period will be considered provided the current pay falls within the range of competitiveness.
• The staff member’s new supervisor will discuss the new performance standards on which the staff member will be evaluated in the next performance period. This must be completed within the first two weeks in which the staff member assumes the new job.

Transfers

A lateral transfer occurs when a staff member assumes a job that has a market target that is within 10 percent of the staff member’s current rate of pay. A lateral transfer generally does not change the staff member’s pay rate, as there is no increase in market target or responsibility.

A lateral transfer occurs when a staff member assumes a job that has a midpoint comparable to the staff member’s present job. A lateral transfer generally does not change the staff member’s pay rate, as there is no increase in market target or responsibility.

A transfer from one classification to another in a lower market target at a staff member’s request will generally result in a pay decrease.

If a hire is an internal hire from the university, a promotion, transfer, or demotion will be defined as follows:

Pay Adjustments

Pay adjustments must be approved consistent with the entity specific business process prior to being communicated to the staff member. Consult with your entity HR representative to confirm the process for approving pay adjustments.

If the pay adjustment is related to a change in job responsibilities, the supervisor will provide the staff member a revised job description when changes are made to the position, and discuss with the staff member the responsibilities and performance expectations on which he or she will be evaluated during the next performance period. This discussion must be completed within the first two weeks in which the staff member assumes the new job.

Premium Pay

Duke provides "premium pay" to staff in hourly-paid positions for working hours other than the standard Monday to Friday workday ("first shift").

The following rules regulate the ways in which premium pay may be paid to health system staff:

• Majority Hour Rule – This policy stipulates that premiums are paid based on the shift containing the majority of hours worked by staff. There is no capping of the work schedule.
• Pyramiding Rule – The “pyramiding rule” stipulates that special pay premiums such as shift differentials, weekend premiums, standby pays, and emergency callback pay will be paid on overtime hours.

The following categories and classifications of staff are not eligible for premium pay:

• Staff working in temporary or secondary positions
• Staff working out of their assigned position (hourly-paid staff who perform work for a defined period of time at a higher level than their job classification in their own (primary) department)
• Staff in monthly-salaried positions

DUHS pay premiums are applicable to primary hours for all biweekly classifications at DUHS. Eligibility rules exclude unclassified jobs.

Qualifying Rules effective July 11, 2005 (08-1 Pay Period)

• Daily Work Schedule - Shift and Weekend Premiums are not capped at the daily work schedule.
• Shift & Weekend Premium Eligibility - The majority hour rule applies across DUHS for all biweekly classifications except secondary and working out of position.
• Pyramiding - Premium pay is provided for eligible primary hours even during “overtime” hours (“Pyramiding”).

Premiums effective July 1, 2016

For specific premium amounts, please click here.

Second Shift Premium: 3 p.m. to 11 p.m.
All DUHS staff who work more than half of their work schedule between 3 p.m. to 11 p.m. are paid second shift premium for all hours worked. Shift premium amounts are determined by the pay band that the classification is assigned.

Third Shift Premiums: 11 p.m. to 7 a.m.
All DUHS staff who work more than half of their work schedule between 11 p.m. to 7 a.m. are paid third shift premium for all hours worked. Shift premium amounts are determined by the pay band that the classification is assigned.

*Clinical RN includes – Clinical Nurse I, II, III and IV (4023, 4024, 4025 and 4026); Assistant Nurse Manager (4262); Clinical Nurse AD/DIP I, II, III, IV (4623, 4624, 4625, 4646); Clinical Nurse, PRN (4231); Clinical Nurse, Heart Ctr Comm (4237); Clinical Nurse PRN - Gig A/B/C (4283, 4284, 4285); Clinical Nurse, Float Pool (4270, 4520, 4525, 4593); Clinical Nurse Float Pool AD/DIP (4618, 4619, 4620, 4641); RN First Assistant (4606); 4628 Clinical Nurse, Internal Traveler

Weekend Premium
The weekend for non-weekend option for staff is defined as first shift Saturday (7 a.m. Saturday) through third shift Sunday (7 a.m. Monday). The premiums listed include both the weekend differential and shift differential.

Clinical Nurse Weekend Premium
The weekend for non-weekend option for clinical nurse staff is defined as 3 p.m. Friday through 7:30 a.m. Monday.

• Staff must work a minimum of two (2) hours per continuous shift within the weekend window to be eligible for the weekend premium. The majority hour rule does not apply.

Weekend Option
The weekend for weekend option for staff is defined as second shift Friday (3 p.m. Friday) through third shift Sunday (7 a.m. Monday).

• Staff are required to work a shift on two different days during the weekend. Any hours worked (assuming the majority hour rule) are eligible while permanently assigned for weekend option premium.
• Premiums for weekend option incorporate both shift and weekend premiums.
• Staff eligible for this premium are permanently assigned to the weekend.
• The position must be associated with a pre-approved job family.
• Within each pre-approved job family, the business need for a Weekend Option position is determined by department and entity leadership.

For details regarding guidelines and eligibility for Weekend Option, click here.

Weekend Option – Clinical Nurses
The weekend option for clinical nurse staff is defined as first shift Saturday (7 a.m. Saturday) through 7:30 a.m. Monday. Clinical Nurse Weekend Option premium is a flat rate in addition to shift differential and Clinical Nurse Weekend premium amounts. Staff must work a minimum of two (2) hours per continuous shift within the weekend window to be eligible for the weekend premium.

Holiday Premium
Holiday premium is paid based on the majority hour rule. The holiday is defined as the period stretching from 11 p.m. on the day prior to the holiday to 10:59 p.m. on the actual holiday. No capping at the work schedule. Eligible hours are paid at time and one-half.

Standby Pay (On Call)
Applies to staff that are on standby call for the potential return to work.

Standby Pay (Called In)
Staff member continues to receive standby pay for time worked if called in.

Emergency Call Back
Applies to staff member not on Standby who is called to return to work.

Preceptor – Clinical Nurses
Premium provided to clinical nurses who serve as preceptors to new nurses.

Charge – Clinical Nurses
Premium provided to clinical nurses who serve in a charge capacity at the unit level.

Standardized Pay Policy Guidelines

Workweek

Workweek begins 12:01 a.m., Monday morning and ends at 12:00midnight on the following Sunday.

Recording Work Hours

Shifts beginning 3:01 a.m. or after will be recorded on the actual day on which they occur.

Daily Work Schedule

The daily work schedule should reflect the staff member’s regularly scheduled hours. All full-time staff should have a work schedule of 8, 10, or 12 hours. The daily work schedule sets the limit(s) for all premium pay, is used in determining the overtime options, and sets the daily limits for recording time off.

Automatic Meal Period Deductions

Based upon department scheduling, staff will have an automatic meal period deduction of 30 or 60 minutes after the first 4.5 consecutive hours worked. Departments also have the option of having staff badge in and out for meal periods. Supervisors must override the automatic meal period deduction for staff who work through the meal period.

Rounding

Hours are rounded to the nearest tenth of an hour.

Continuous Shifts

A “continuous shift” is defined as one in which the staff member does not leave the work site for a period of more than two hours of unpaid time.

Double Shifts

“Double shifts” are defined as continuous hours that equate to a minimum of 4.1 hours beyond the normal daily shift schedule.

Overtime Options

Two overtime options are available for Health System staff. They are as follows:

• Overtime Option 2 – An option that pays overtime for the greater of 8 hours per day or 80 hours per pay period.
• Overtime Option 3 – An option that pays overtime over 40 hours per week. This option is required for fringe benefit codes 05, 06, and 12 as well as for staff who are scheduled for 10- and 12-hour shifts.

Special Overtime

Currently, time worked and time off with pay is reported on the workday that the shift begins. As a result of recording time in this manner, overtime hours cannot be properly identified and paid by the payroll system without department intervention. Department Payroll Representatives must submit a Special Overtime Card to add the additional overtime hours due. Please note that few special overtime cards are submitted by departments.

Hours Included in Determining the Number of Overtime Hours

Worked Hours (Primary and Secondary) will be used in determining the number of overtime hours.

Shift and Weekend Premium Eligibility (Excluding Holiday)

The majority hour rule will apply across DUHS for all classifications including DUH, DHRH, and DRH. There is no capping at the work schedule across DUHS.

Broad-banded Structure

The delivery of pay premiums occurs within a broad banded structure. The determination of shift premium amounts in the broad banded structure is based upon the pay band assigned to the job classification.

Holiday Premiums

Holiday premium is paid based on the majority hour rule. The holiday is defined as the period stretching from 11 p.m. on the day prior to the holiday to 10:59 p.m. on the actual holiday. No capping at the work schedule. Eligible hours are paid at time and one-half.

Working Out of Position

Eligible staff who are working out of position may be paid an additional 5% of their base rate or the difference between their base hourly rate and the minimum rate of the position in which they are temporarily working. The rate or the flat amount must be entered in ReportXpress by the supervisor.

Inconvenience Pay

Eligible staff who report to work and are informed that they may be excused due to low census (etc.) will either work for two hours or receive inconvenience pay for up to two hours of their base hourly rate. This will be in addition to any applicable shift and/or weekend premiums (for up to two hours).

Pyramiding Premiums

This policy allows special pay premiums such as Night Shift Premium, Weekend Premium, Standby, and Called-In to be paid on overtime hours.

Daylight Savings Time

Staff are paid for the total number of hours worked. During the spring, when North Carolina loses an hour of time due to Daylight Savings, staff may need to use one hour of paid time off in order to receive payment for the full work schedule.

Operating Room Dress Time

An additional 10 minutes of paid time is added to the shift-start period to allow for OR staff dress time.

Grace Period

There are no grace periods.

Weekend Option Guidelines

The following guidelines have been developed for weekend option (WEO) schedules. The weekend option premium is intended to act as an incentive in challenging staffing situations by providing additional premium pay to staff members who make a special commitment. At the discretion of the employing department, the weekend option premium is available to certain bi-weekly staff members who have agreed to work every weekend and meet all eligibility requirements.

Position Eligibility

In order to be eligible for Weekend Option, the position must be in one of the following job families:

• 7 Office Support – Medical
• 10 Clinical Technical/Professional II
• 11 Nursing - Inpatient
• 15 Clinical Labs
• 17 Clinical Technical/Professional I
• 20 Service, Non-Bargaining Unit
• 30 Service, Nursing Care
• 32 Nursing-Administrative & Ambulatory Care

Note: Employees in job family 11 – Nursing Inpatient may be eligible for the Clinical Nurse Weekend Option Program 

Departmental Decision

The department and entity leadership must determine the need for a position to be created with a weekend option (WEO) premium option; then, the staff member in that position must commit to the WEO eligibility requirements to receive that higher weekend option rate. The standard weekend premiums apply to all others who work weekend hours.

Individual Eligibility Requirements

To be eligible for the weekend option (WEO) premium, bi-weekly staff members must be paid for at least two non-consecutive shifts within the WEO window. In areas that utilize 12-hour shifts, a WEO staff member must work 24 hours within the WEO window. In areas that utilize 8-hour shifts, a WEO staff member must work 16 hours within the WEO window. The weekend option window for weekend option staff is defined as second shift Friday (3 p.m. Friday) through third shift Sunday (7 a.m. Monday), and the majority hour rule applies. To continue in weekend option status, a staff member must also follow the standards for scheduled and unscheduled time off.

Scheduled and Unscheduled Weekend Time Off

• Weekend option (WEO) staff members are allotted a total of 8 weekend shifts off (scheduled and unscheduled days). Supervisors may grant WEO staff members' requests for up to, but not to exceed, eight (8) scheduled weekend shifts off per calendar year. The number of allowable shifts off will be prorated for employees who start on a WEO schedule after January 1.
• No more than four (4) of the allotted eight (8) weekend shifts may be taken as unscheduled absences. More than four (4) unscheduled shifts would require the employee to forfeit eligibility for the WEO program and premiums.
• More than 8 absences (scheduled or unscheduled), would require the employee to forfeit eligibility for the WEO program and premiums.
• Requests for PTO will follow unit procedures.
• The following are excluded from the eight (8) scheduled shifts off per year:
  • Time off granted outside the WEO premium window
  • Time off granted within the WEO premium window if the employee already worked the agreed upon 2 shifts for that weekend
  • Pre-approved trades or substitutions, which do not generate overtime for either staff member, and that have been approved by the manager or designee
  • Shift cancellations at the request of the department due to low census/workload
  • Continuing education leave
  • Approved medical and family leaves of absence
  • Only two consecutive weekends off will be scheduled per year (approved leaves of absence may be excluded)

Commitment

The length of an agreement to work a weekend option (WEO) schedule is a minimum of 6 months but the agreement may be extended indefinitely. Automatically extended agreements may be canceled with 30-days written notice by either the staff member or supervisor. An employee who breaks a WEO agreement may reapply for a WEO schedule after 3 months. Approval will be subject to the scheduling needs of the unit and will be at the discretion of the supervisor.

The staff adherence to the WEO schedule standards will be evaluated according to the WEO Schedule Policy and entity attendance policy.

Employees may forfeit their WEO schedule if they have violated their contract by exceeding four (4) unscheduled shifts or failure to maintain all hospital and unit competencies and standards.

Applicable Hours

The weekend option (WEO) premium is paid on hours worked, for shifts where the majority of the shift is worked during the WEO window. The WEO window for weekend option staff is defined as second shift Friday (3 p.m. Friday) through third shift Sunday (7 a.m. Monday).

A WEO staff member may also work weekday shift assignments in order to fill the hours that the staff member desires to work and to meet department or unit staffing needs. However, the WEO premium rates apply only to those shifts worked within the WEO window. When working outside the WEO window, the staff member will receive the standard weekday shift premium.

Policy Number: 07.03