FRAMEWORK AGREEMENT CASE STUDY

UNIVERSITY OF SOUTHAMPTON

Contacts: Tony Strike, Director of Human Resources

Geoff Lang, Assistant Director (Organisational Development)

Introduction

Awarded its Royal Charter in 1952, the University of Southampton is one of

the UK’s leading universities and a member of the Russell Group of research-
led universities. It is among the top ten of universities for research and aims to
be among the top ten for teaching excellence. The university has nearly
20,000 students and 5,000 staff based on seven campuses in Southampton
and Winchester. The university is the third largest employer in the
Southampton area. In the financial year 2001/2 the university’s income was
£233.8 million (£145 million of which was research income) and its
expenditure £229.6 million. The current Vice-Chancellor is Professor Bill
Wakeham.

The University’s staffing is as follows:

Staff Nos as at 01.11.03 (headcount)

Academics 1186
Teaching Fellows 55
Researchers 1005
Academic Related 771
Clerical/Library Assistants 930
Manual/Maintenance 481
Technical 351
Other Support 83
Total 4,860

The University was restructured in 2003 from 70 schools and departments

into 20 schools in three faculties. There are roughly ten departments per
faculty. The primary operating units are the 20 schools, each led by a Head of
School.

In addition there are 10 “Professional Services” departments employing over

1500 staff. These include Business and Community Services; Corporate and
Marketing Services; Estates and Facilities; Finance; Information Systems
Services; Legal Services; Library; Research and Enterprise Services; Student
Services: and Human Resources.

The University senior management team consists of the VC, three Deputy
VCs (for Research and Enterprise; Education and Information; and Resources
(finance, property etc)). Three Faculty Deans cover the 20 schools. The
University Secretary has responsibility for the Professional Services Directors.
Altogether there are 27 organisational units (schools and service
departments) represented on the senior management executive.
This reorganisation in 2003 meant that 700 staff had to be re-deployed.

The university employs virtually all its staff directly and business services
have not been put out to tender.

The university recognises the AUT as the representative trade union for
academic and academic-related staff and Amicus, TGWU and Unison for
support staff. There is a joint negotiating committee at institutional level.

The Human Resources Department

The HR Department employs some 56 staff. These include personnel

services; staff recruitment; staff resources; safety; including occupational
health; staff diversity; career pathways and pay; staff development; and the
temp bank.

The university adopted a Human Resources Strategy in April 2000. This was
submitted to HEFCE under its ‘Rewarding and Developing Staff’ initiative and
was one of only 17 out of 130 funding bids that were fully funded for three
years. A Remuneration Manager and Assistant Remuneration Manager were
appointed in January 2002 to run the project.. During the main pay and
grading review, 2 additional project workers were employed on 12 month
contracts to carry out much of the assimilation work to the new structure, and
two Remuneration Assistants were also appointed to support the project. The
additional project worker posts were required because of the University’s plan
to follow a university-wide job matching process. This would involve all
Schools/Departments matching job descriptions for all their posts against
generic role profiles for 8 main Grades/Levels below Professor/Director as set
out in a new “Career Pathways and Job Family Profiles” Book. Heads would
take final responsibility for each job matching, supported by HR.

Developing a New Reward Strategy

When the new VC unveiled his corporate strategy propositions, these

included a need for clear career pathways for all academic staff. Traditionally,
academic staff had progressed according to their research prowess but the
new VC wanted a renewed emphasis on teaching quality to ensure
Southampton’s place in the top ten of UK universities. He was also keen to
develop the enterprise agenda through incubator companies. In order to give
parity of importance to teaching and enterprise excellence alongside
research, new clarified career pathways were needed. The first move was to
create a clear grading system with new criteria for promotion, for example
Senior Lecturer became equivalent to Reader; and the position of Director of
Education would sit alongside Professor. . Southampton had already,
therefore, developed the basis of a new academic grading structure before
the Framework Agreement. This then needed adapting when job matching
took place.
Deciding on Job Evaluation

Southampton took part in pilots for both the HERA JE scheme and Hay.
Based on a pilot of HERA (based on 30 role analysis interviews), it became
clear that HERA was grossly overrating engineering/science and hence over-
grading these academics. This was partly because of the Environmental
factor in the HERA scheme which weighted engineers/scientists over other
academics because they worked in hazardous environments. HERA also
weighted all factors equally. Further difficulties Southampton found with
HERA included the fact that the process was very staff intensive and time-
consuming; that JE rather than the university’s strategy would be driving the
reform of structures; and the scheme was generally over-complex in terms of
the number of factors used. HERA attempted to refine its scheme to fit
research-led universities but this was still not to the satisfaction of
Southampton. Southampton also found initial problems with the Hay scheme,
for example it did not reflect very well HE terminology and culture. However,
Hay adapted its guide charts to better reflect work in an academic institution.
Whilst Southampton was still considering which JE system would be most
appropriate, it also took the decision that JE should not lead the process, but
that the university’s strategy should drive it. This included a clearer career
structure for all staff; a simplified grading structure across all staff groups with
clear steps between grades; and clearer statements of expectations at each
Level in the university, including clear management accountabilities.

The university was a member of a consortium of universities that also

included Oxford, Imperial College London, Nottingham and Bristol. In principle
this consortium agreed a new structure consisting of four job families –
Administrative and Professional; Technical; Operational Services; and
Academic. This work, supported by Hay consultants, suggested up to seven
generic levels for any job family. At Southampton, the Remuneration team
consulted the university’s Heads of Department, unions and established focus
groups with representatives of the various job families and ran a pilot job
matching exercise which produced an acceptable match for most staff. It was
therefore agreed to use a Job Family matching approach, underpinned by the
Hay Job Evaluation system in September 2003. Job matching of all university
posts began in parallel with a smaller analytical JE exercise with 100
benchmark posts to be analysed. The words used to describe job levels were
closely linked to Hay terminology so the university was confident that job
matching would produce similar results to Hay.

It was felt that it was easier to get people to agree job matches to grades
without staff knowing the salary points so a ‘chinese wall’ was established
between those doing the Hay JE and those writing the job descriptions. Job
matching was done school by school with job descriptions being
written/updated by post holders and their line managers and then agreed by
Heads of Department. All Heads were briefed on this process and detailed
guidance on writing job descriptions was provided. It was stressed to Heads
that all members of staff should have the chance to see and comment on the
job description which would be submitted to the job matching panel. Each
panel would consist of the Head, a member of the Remuneration Team, the
School Manager or equivalent, and any other management representative
nominated by the Head (e.g. Chief Technician, Head of Research Group etc.).
A budget of £2.4 million was agreed for the project and the new structure had
to fit the budget. The matching of jobs to grades produced a relatively small
number of examples of red or green circling, due to careful paybill modelling
as the job matching results began to appear.

The Industrial Relations Process

A special pay and grading sub-group of the university’s JNC was established
to consult with the trade unions in January 2003. This was chaired by the
Head of Career Pathways and Pay. Regular reports were provided to the
main JNC. All unions were represented at working group meetings, which
then continued in the same format into formal pay negotiations in 2004.

The working group discussed all matters relating to the job matching and job
evaluation processes. Results from both exercises were shared with the
union representatives. In May 2004 final pay offers were made to all unions.

The three support unions – Amicus, TGWU and Unison – agreed,

nonetheless, to ballot their members on the new agreement and structure.
The ballots took place over a four week period. The only significant opposition
came from senior clerical staff but the ballots were all in favour. The support
unions signed the new agreement on 30 June 2004. Letters were then sent
out to individual support staff showing their new grade and pay point. All non-
academic staff moved to a new point on the unified 51 point national pay
spine from 1 May 2004 (backdated) with a 3% increase on this point from 1
August 2004. Staff received their first increment on this new structure from 1
July 2004.

Both the AUT local branch officers and the AUT regional officer were present
at all meetings of this sub-committee. In general the unions were satisfied all
the way through the exercise except at the stage when the AUT national
officers became involved. At this point the AUT indicated minor but important
objections to the new structure for academic staff and decided not to ballot
their members on the proposed agreement. These objections related mostly
to the slower progression of some new staff appointed after 1st October 2004,
compared to “protected” rates of for existing staff.

During August 2004, following unsuccessful attempts at reaching an

agreement with AUT, the University decided (without AUT approval) to issue
individual offers to all existing staff giving them an opportunity to accept the
deal as it stood, whilst it undertook to continue to try to resolve those issues
that only affected future appointments. Many staff accepted this offer and
were assimilated to the new pay system in October 2004 (backdated to May).
In the meantime, AUT and the University continued to discuss the problem of
progression for new appointments. Whilst no immediate solution was
reached, both sides agreed to a local Memorandum of Understanding, which
set out the disputed points and which obliged them to try to resolve the
outstanding issues by August 2005 (when some new appointments would
reach their first increment date). No solution has still been found at January
2005.

The New Grading Structure

The new pay and grading structure consists of seven main levels. The
seventh level covers senior management staff, such as a professor, director
of research or director of a large and diverse university department with
strategic importance. Levels 1 and 2 have been further divided into two sub-
levels (a and b) to accommodate the organisational structure of the university.
The six main grades (eight, including the split levels) are shown in the table
below (see Table 1). Each level consists of two pay ‘zones’ – a ‘Core Zone’
and a ‘Higher Responsibility Zone’ (see Table 1). Within each zone there are
incremental pay points which are based on the 51 national pay spine provided
under the Framework Agreement. The new pay points replace all other pay
scales with effect from 1 May 2004. Eight extra pay points are being added
above the 51 point scale by Southampton to enable it ‘to become a more
competitive employer’, especially in the market for senior academic and
related staff.

Core zones provide normal incremental progression (subject to satisfactory

performance) through the spine points. Higher responsibility zones (HRZs)
are ‘discretionary’ zones used for those roles that satisfy the HRZ criteria.
There is no automatic incremental progression through the HRZs.

Table 1. New Grades as at 1 August 2004

Grade Spinal points Core Zone HRZ

Grade 1a 1-2 (3-5) £10,560 – 10,877 £11,203 – 11,885
Grade 1b 3-6 (7-10) £11,203 – 12,242 £12,609 – 13,778
Grade 2a 7-12 (13-16) £12,609 – 14,618 £15,056 – 16,452
Grade 2b 13-19 (20-23) £15,056 – 17,978 £18,537 – 20,235
Grade 3 20-26 (27-31) £18,537 – 22,111 £22,774 – 25,633
Grade 4 27-34 (35-39) £22,774 – 28,009 £28,850 – 32,471
Grade 5 35-43 (44-48) £28,850 – 36,546 £37,643 – 42,367
Grade 6 45-52 (53-59) £37,643 – 47,335 £48,420 – 54,510
 Job Families and Levels. Example Roles

Level Education, Technical and Management, Community and

Research and Experimental Specialist and Operational
Enterprise Administrative
1a NA NA NA Cleaner
Porter
Catering Assistant
1b NA Trainee Technician Receptionist Security Guard
Typist Domestic
Supervisor
Grounds Assistant
2a NA Lab Assistant Secretary Security Supervisor
Clerical Assistant Chef
Nursery Officer
2b NA Technician Finance Assistant Carpenter
Exams Assistant Electrician
Senior Secretary Sports Officer
3 Teaching Assistant Senior Technician Co-ordinator of Deputy Halls
Research Assistant (Design input, Office/Function Manager
Junior Consultant Research support) PA To Head of Works Supervisor
School Senior Sports
Officer
4 Lecturer (A) Workshop Professional Halls Manager
Post-doctoral Supervisor Specialist (HR, Works Manager
Researcher; Specialist Accountant, IT,
Teaching Fellow, Technician Engineer etc.)
Consultant (highly skilled) Office/Programme
Experimental Manager
Officer

5 Lecturer (B) Senior School Manager;

Research Head of large Operational Function/Unit with broad impact
Fellow Senior Specialist (IT, Finance, HR etc.)
Senior Consultant Senior Experimental Officer
Chief Technician (head of large workshop)
6 Senior Lecturer; Head of significant Professional Service Unit with strategic
Reader; impact
Principal Head of Specialist, Strategic Function with broad impact
Research Fellow; Lead Specialist Advisor in key strategic area
Head of
Consultancy Unit
7 Professor Director of large University Department with strategic
Director of importance (Finance, HR, IT etc.).
Education
Key principles underlying the pay design structure

• Progression through Core Zones recognises experience and contribution.

• Heads of School/Department have discretion to reward additional
accountability and responsibility within the pay structure through the use of
the HRZs.
• Each HRZ overlaps from the minimum point on the next level to a point
below the maximum of the Core Zone in the next level to maintain the
integrity of the JE scheme.
• The same pay ranges apply for each level across all four job families to
ensure equal pay for work of equal value across the university.

Assimilation

There are five ‘scenarios’ concerning assimilation.

• Staff currently under-graded (green-circled). These staff will receive an

additional increase to bring them up to the new level’s minimum. These
staff will have right of progression to new maximum of the CZ (subject to
satisfactory performance).
• Staff correctly graded with a new core zone maximum at least as high as
existing maximum. These staff move to the next available pay spine point.
If this is within their CZ, there is a right of progression to the maximum of
the CZ.
• Staff correctly graded but with a new core zone maximum lower than the
existing maximum. These staff have the protection of progressing annually
to the next nearest pay spine point above the existing pay range
maximum, even if this is within the HRZ or above the new HRZ maximum.
If the member of staff is currently on a discretionary point (pre-1st May
2004) pay range, assimilation will take place to the next nearest available
point on the new pay spine and protected on that point. No further
progression is available within this level.
• Staff over-graded and where existing salary falls above the maximum of
the new level’s HRZ (red-circled). These staff will have their salaries
frozen at the current rate for four years or until the HRZ maximum catches
up with the frozen salary. At the end of the period, if the HRZ has not
caught up, the salary will automatically be reduced to the HRZ maximum
and annual cost of living increases will apply to this point onwards.
• Over-graded but existing salary falls below new level’s HRZ maximum (i.e.
restricted headroom in the new structure). Staff will be assimilated to the
next nearest pay point in the new level. If this falls within the new level’s
core zone, staff will have the right to progress annually to the core zone’s
maximum. If this falls either at the maximum of the CZ or within the HRZ of
the new level, further progression is discretionary and not automatic. In
this case, staff will not have a right to progress to your old pay range
maximum.
Appeals Process

Should a member of staff not agree with the new job family level, an appeals
process has been drawn up in consultation with the trade unions which
specifies the criteria and process under which an appeal can be submitted.

Harmonisation of Other Terms and Conditions

The university is committed to harmonising terms and conditions across job

families for staff with within the same level. Most terms and conditions will not
change from 1 May 2004 but some changes from 2005 have been agreed
with the trade unions.

a) Base Working Week for Levels 1-3

The new base working week for Levels 1 and 2 will be 36 hours and for Level
3 35 hours. Between May 2004 and August 2005 the change will be notional
only, with pay zone points linked to the target working week rather than the
actual working week. If, for operational reasons, managers continue to require
staff to work the pre-May 2004 base hours after August 2005, the difference
will be paid at the new base rate. Any shift patterns or additional hours above
the base working week are unaffected by the current changes. Pay
enhancements across Levels 1-3 are also unaffected but there will be a
review of all special payments with a view to harmonising where possible from
August 2005. Current clerical and library staff working 35.5 hours per week
will continue to have the personal right to continue with these hours as long as
they remain in Levels 1-2. From 1 October 2004 all new staff at Levels 1-2 will
be appointed on 36 hours per week.

b) Working Week arrangements for Level 4 and above.

All staff at Levels 4 and above will work a nominal 35 hour week from 1
October 2004, ‘although staff will be required to work the hours required to
carry out the job effectively’. In those cases in which clerical and library staff
are moved into Level 4 or above from a set working week, they will have the
choice of whether to accept or not the promotion. Staff moving into Level 4
and above will receive no overtime payments from 1 October 2004 but will
receive 30 days annual leave from that date.

c) Annual Leave

Current annual leave includes six closure days and eight public holidays over
and above annual leave entitlement. From 1 October 2005 current annual
leave entitlements will be harmonised across each individual job level,
simplified where possible, and a unified annual leave year introduced for all
staff. The new unified leave year will run from 1 October to 30 September for
all staff. This will take effect from 2005 and hence all those staff on different
holiday years will have an extended holiday year up to 30 September 2005.
Staff on Levels 1b-3 will have new improved long service arrangements from
1 October 2005. Annual leave entitlement will rise from the basic 20 days to
24 days after four years’ service. Staff on Levels 4 and above will have 30
days on entry and will not have service-related entitlement.

d) Pensions

Staff moving into Levels 1-3 will be attached to the University’s PASNAS
scheme (Pension and Assurance Scheme for Non-Academic Staff). Staff
moving to Levels 4 and above will be attached to the Universities
Superannuation Scheme (USS). Staff who suffer detriment as a result of this
change can elect to continue in membership of their previous scheme on a
personal basis. Any changes to pension arrangements were planned to take
place from 1 October 2004, although discussions with USS are still ongoing
for existing PASNAS staff moving into Level 4 or above.

Annual Reviews of the New Pay and Grading System

‘The university and trade unions are committed to working together in

partnership towards a shared value of equal pay for equal value and towards
maximising the competitiveness of the University’s pay scales’. Both sides will
continue to meet as a Pay and Grading Working Group of the JNC on an
annual basis to review the new pay and grading system and processes, and
to consider priorities for annual pay reviews.

Market Supplements

The university operates a number of recruitment and retention supplements in

three categories:

• Recruitment bonuses (‘golden hellos’)

• Retention lump sums
• Traditional market supplements paid on top of salaries for particular
occupations.

Schemes are only funded where they meet the University’s strategic priorities
and where a clear staff group can be identified as in need of a market
supplement. Current initiatives include schemes to retain high performing
Readers/Senior Lecturers until they achieve Personal Chairs as well as
offering welcome payments to academics in difficult-to recruit areas.

The University intends to improve its gathering of market pay data over the
next few years. This will include relating Hay JE points to market pay rates
across the economy, pooling information with other Hay consortium
universities and improving the collection of local market pay rates for support
posts. It intends to draw up a formal market pay policy.
Communications

The university has seen communication of its plans to staff as of the highest
importance. A brochure detailing the original career pathways and job family
profiles was issued in October 2003 along with a ‘Frequently Asked
Questions’ brochure. This was followed in March 2004 with an update
outlining the five on-going elements of the pay and grading project. In July
2004, the detail of the new pay and grading structure, showing the new pay
and grading structure, the assimilation arrangements and the rules on pay
progression within levels was issued. This also gave details of the
harmonisation of terms and conditions.

The University intends to issue a revised “Career Pathways and Job Family”
Profiles book to all staff in the Summer of 2005. This document will be used
in the staff appraisal process, in training and development planning, in
recruitment and selection, and in the academic promotion process.

Costs

The total full year cost of initial assimilation of university-graded posts to the
new pay and grading structure is around £2.4m including pension and NI
costs, and assuming normal turnover in 2004/5. This represents 2.2% extra
on top of the university’s current paybill for these staff and equates to the
amount made available under RDSI. Additional incremental progression in
future years costs are built into University budgets.