Given we have a unionized setting, employees will receive a pay increase negotiated by their contract. However consideration is underway for the small workforce not under contract (leadership) will not receive any pay increase this year. We have also engaged a consultant to look to do job analysis and to consolidate into bands where possible as our part 2 video described. We are also putting into place a new performance management system - the part that is catching us is the need to do a great deal of leadership development so that the "system" really works. I am surprised that there was not more mentioned in our readings about leadership development to make performance management work. That being said, the readings did provide a good summary of the core components of HR. Sadly we have no new or innovative pay increase programs. Laura

Good questions, Andrew. I'm interested in hearing others' responses. Although I've heard a lot about separating pay and annual performance evaluations, I have not seen this trend personally (I've been in three hospital systems since 2000). I've seen several different bonus programs including providing flat bonuses to all employees if the institution meets financial goals as well as tying bonuses to hospital and department goals. I did work for one hospital system that "froze" staff pay increases, and it did not go over well at all. We didn't have significant turnover, but morale bottomed out (which, as we all know, greats impacts quality of care).

I work for an organization that has separated annual performance evaluations and pay raises. We call them merit raises although they really are more like cost of living adjustments. We have also frozen salaries for leadership positions, but we will be providing staff level employees a raise this summer. We just completed townhall meetings with our staff to communicate this decision and surprisingly it went very well. I am in a market where competitor hospitals have had signficant layoffs, pay cuts, and termination of retirement funding. That news has helped with the message that we have delivered.

My organization changed our process a little this year. Our Directors and Managers will evealuate each one of their employees on a merit based system. Once that is complete our HR department will take all the scores and create a bell curve so the deprtment maintains an average of a 3% raise. In the past the merit scores were broken into groups that would determine the employees raise i.e. 95-100 points would be a 5% raise. We have also frozer salaries for leadership positions, but our front line employees will continue to get their annual adjustments. We have also been able to keep in contact all our 401K matching and retirment plans. Our employees have been very greatful when told they were going to recieve their raises this year.

We have a small administrative organization so pay increases were frozen for all employees this year. Since this does affect morale, we have implemented a program just for this year wherein an employee can take off an extra 5 days, with pay, sometime throughout the year, upon approval of their supervisor. Some employees like to take Fridays and/or Mondays off, others like to take the full week all at once. Since all positions are cross-trained, we can shift the work load for the occasional day that a certain employee is gone. It does not cost the organization any extra money for this program; it is really just lost productivity time. The employees appreciate the extra perk and are happy to take on their colleagues work when they are away as they know the favor will be returned. It has actually created stronger working relationships in the office.

I am also interested in others comments regarding this subject. Our network does not/has not had a program of merit increases. Performance reviews are conducted annually and assuming a satisfactory appraisal the employee would get the next step in their pay grade. Several years ago now the steps were adjusted to take 12 steps to reach the top of their pay grade assuming they started at the bottom rate. Once the top level is reached, the only increase is a possible annual cost of living raise which has been 3% the last several years. I have been very interested in reading the Human Resources section. Coming from a clinical background into management, I have been confused by our review system which I feel breeds mediocrity. Besides an employees own personal drive, there is no motivation to do greater than 'average' work. To me this is unfortunate and almost punishes those that are very dedicated and innovated in their work.

I enjoyed reading Barbara's posting about additional paid days off. Nice concept - but does that not somewhat minimize the cost savings of a pay freeze?

We currently do not employ a merit pay increase model for our health system. However, there are benefit programs in place that reward longevity of employees by contributions being made to their 401K and pension plans, etc.

This is a very interesting topic relating to how to reward your high performers, possibly with compensation models. We are currenlty having discussions with all employees surrounding the high/middle/low performers depicted in Hardwiring Excellence by Quint Studer. I believe that many other intangible rewards will also make those employees feel valued within an organization.

Also, we have been fortunate to date, that employees have still received annual increases, despite the economic times we live in.