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July 9, 2009

Some retention bonuses donated

The June 30 end of the University’s fiscal year continues to trigger retention incentives for Chancellor Mark A. Nordenberg and three University officers.

Under an extension of the Board of Trustees’ 2002 retention incentive pay plan, Nordenberg will receive $75,000 because he has remained in his position for another year. Executive Vice Chancellor Jerome Cochran, Senior Vice Chancellor and Provost James V. Maher and Vice Chancellor for Budget and Controller Arthur G. Ramicone each receive $50,000 under the plan.

While the retention plan remains in place, Vice Chancellor for Public Affairs Robert Hill stated, “Given the challenging economic environment, some of the involved officers, including the chancellor and the provost, have chosen to use their retention payments to make new commitments to the University’s ongoing capital campaign. They have done so with a focus on student support, which is a priority of that campaign.”

The retention plan, overseen by the trustees’ compensation committee, was established after a consultant’s 2002 review found Pitt officers’ compensation low in comparison to a group of research university peers.  

Rather than implement a salary increase, said Hill, “The committee decided that it was in Pitt’s best interest to make the adjustment through deferred retention incentive payments tied to continuing service. That decision was grounded in the belief that a board priority should be the retention of the University’s already experienced and accomplished leadership team.”

Absent an action from the compensation committee, the plan continues indefinitely.

Officers’ compensation is not set at the same time the salary pool for other Pitt employees is set. Typically, the salary pool increase is announced after a state budget is passed and the trustees, in turn, set the University budget.

However, last March, on the recommendation of the University Planning and Budgeting Committee, Nordenberg announced there would be no salary pool increase for fiscal year 2010, which began July 1. (See March 5 University Times.)

The trustees’ compensation committee typically sets officers’ compensation in December, retroactive to the start of the fiscal year. Last December, on Nordenberg’s recommendation, the committee froze officers’ FY09 pay at FY08 levels. (See Dec. 5, 2008, University Times.)

“The officers and compensation committee are moving forward with the shared expectation that the salaries will continue to be frozen in FY 2010,” Hill said.

Hill noted that the officers’ FY09 pay was frozen at FY08 levels, while other employees’ pay was frozen at FY09 levels, adding, “The committee took no action with respect to its retention incentive program, recognizing that those payments have not been increased since the program’s inception in 2002, meaning that the retention component of officer salaries already has been frozen for several years.”

—Kimberly K. Barlow

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