IU salaries remain competitive despite freeze

Last May the IU Board of Trustees approved a budget that would not allow for salary increases. However, on Nov. 1, the 2010-2011 annual salaries went into effect, and despite the campus-wide salary freeze, some IU employees found that their pay had increased.

A database released by the Office of Financial Management Services and made available to the public revealed that some employee’s salaries increased by up to 6 percent.

“Rather than across the board raises to every employee, instructions were issued that all salary increases were to be strictly merit-based,” said IU spokesman Larry MacIntyre. “That means that some employees received raises of 3 to 6 percent, but it also means that others didn’t get any raise at all.”

According to MacIntyre, the merit-based raises were instituted so that IU could remain competitive despite budget shortfalls.

“These salaries compete for faculty with other top universities,” MacIntyre said.
According to the IU Factbook 2009-2010, the average salary is $90,000 for an assistant professor, $105,300 for an associate professor and $149,000 for a tenured professor.

However, the salary database revealed that compensation varies by department and is dependent on more than faculty status.

Physics Department Chairman Rick Van Kooten has experience with negotiating salaries. When a department is seeking to hire a new faculty member, the department chairman acts as a mediator between the dean and the job candidate.

“Salaries are negotiated based on the going market price, the salaries of other professors inside the department and departmental equity,” Van Kooten said. “Numbers are collected every year to ensure that the going rate is still accurate. ... Once we show candidates the statistics, they usually realize the offer is competitive.”

A policy implemented through IU Human Resources outlines guidelines regarding salary decisions for all professional staff. The document states that management should make decisions regarding employee pay in a consistent manner, and it provides the criteria to do so: principles applicable to all salary decisions include non-discrimination, emphasis on internal equity within a department, the employee’s job-related qualifications and performance, the department’s fiscal status and market considerations for similar work in external labor markets.

Van Kooten, however, knows that the formula is not inflexible.

“When we try to recruit someone to enter the academic world from a national lab, they are coming from a high salary so we have to be careful,” Van Kooten said.

To remain competitive with outside opportunities such as research laboratories, Van Kooten said it is common for science departments to offer a start-up package that provides up to a million dollars over a few years for more senior faculty members to begin their research at the University.

“The competitive nature may actually be more dependent on the start-up package than on the starting salary,” Van Kooten said.

Russell Hanson, chairman of the political science department, said other departments within the University also offer start-up benefits.

“Political science is not recruiting this year,” Hanson said. “But when we do, we offer a starting salary that is competitive with starting salaries offered by political science departments in the Big Ten, plus a summer fellowship or two, plus a modest research fund, plus a semester of pre-tenure leave from teaching.”

Van Kooten said the business school, which is the department with many of the highest paid academic faculty members, also has to closely consider the competition from external labor markets. Since business professors have the opportunity to make more money in the industry, their salaries must remain competitive with the public and private job markets as well as with other universities. 

“Overall, IU offers reasonably competitive salaries compared to other tier-one research universities,” Van Kooten said. “And we keep annual numbers to justify it.”

While Hanson agreed that IU offers salaries that are competitive when recruiting new faculty, he said retaining key faculty is a different matter. If the University is at risk of losing a top faculty member to another institution, Hanson said the faculty member is usually given a counteroffer that is equal to the competing offer.

“Except for new faculty, salaries at IUB are low because increases after a person arrives tend to be quite small,” Hanson said. “That makes us vulnerable to ‘raiding,’ and we aren’t always successful in retaining someone with an offer from another institution. But we’ve been pretty successful in recent years.”