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Compensation Programs

Vanderbilt University Medical Center maintains and administers a compensation program that will attract, reward, and retain a well-qualified workforce. The program balances internal equity and market competitiveness. Jobs of like responsibility and labor market conditions will be paid within comparable pay ranges/grades based on an evaluation of each job and relevant market data. Individuals with comparable backgrounds (experience, skills, ability, and education) will be hired at comparable rates for the same or a similar job classification. An annual increase program is designed each year in support of the overall philosophy. Performance evaluation is a driving component of the program.

We analyze relevant market data and develop compensation strategies to assist in meeting business objectives while being fiscally responsible and compliant with all applicable laws and regulations.

Our compensation structure encourages individuals to grow in terms of their talents and support of the organizational mission.

The compensation program will be continuously evaluated and revised as needed to ensure that the intended objectives are met.

Who is covered?

This document is designed to describe the VUMC Compensation Program for individuals in non-exempt hourly paid and classified exempt monthly paid jobs.

Who is responsible?

Managers: Managers and supervisors play a vital role in the implementation and the ongoing administration of the Compensation Program. They are most familiar with work performed in their departments and the abilities of the individuals who do the work. Specifically, managers and supervisors will have the responsibility to regularly and consistently:

  • Respond to questions about individual pay and Compensation Program policies and practices.
  • Review, at least annually, with each individual the content of their job.
  • Keep Human Resources advised of changes in job content.
  • Develop and update job information for jobs in their departments.
  • Provide continuous performance feedback and develop goals with staff.

Managers and supervisors administer the program within their own departments.

Human Resources oversees the overall program.

Human Resources: The Office of Compensation maintains awareness of and analyzes emerging trends and changing circumstances that impact compensation in order to keep VUMC's compensation programs up to date and relevant.

  • Designs and delivers education and tools that support efficient, effective, and compliant decentralized HR management.
  • Collects and compares relevant market salary information to establish and maintain competitive pay ranges.

In order to provide market competitive and reasonable salaries, jobs must be assigned to an appropriate pay grade.

The process of assigning a job to an appropriate pay grade involves:

  • Collecting and reviewing job information
  • Comparison with other like jobs
  • Relevant market considerations

Job Information and Comparison

Job descriptions are available for staff and supervisor reference. The job descriptions found online reflect the major job functions and minimum requirements for the job and is used for job classification across the institution. Position descriptions are developed at the department level to reflect more specific descriptions of the major job functions and are used for recruiting the best talent for the role, for training, and for performance development and evaluation. Position descriptions should be reviewed at least annually as a part of the performance evaluation process. Significant changes may be submitted on-line through the job description database unless the job is utilized across numerous departments. In this instance contact the Office of Compensation to discuss the job changes. The Office of Compensation, Human Resources will review job changes, make comparisons within relevant market and with other like jobs at VUMC to recommend appropriate job title and pay level.

Relevant Market Considerations

Relevant competitive market salary studies are conducted by the Office of Compensation, Human Resources in consultation with the appropriate budgetary official(s) to establish and adjust pay levels as necessary.

The market analysis process includes data collection and analysis of:

  • Salaries paid to jobs recruited on a local, regional or national basis
  • Supply of applicants with specialized or unique skills
  • Staffing needs in terms of number of vacancies and length of time to identify qualified applicants

Annually, and more frequently for certain classifications, Human Resources, Office of Compensation, receives and analyzes relevant market data to compare the competitiveness of VUMC's salaries against the market. Market surveys determine rates paid by competitors for similar jobs. VUMC's goal is to be competitive in the markets in which it competes. How an organization positions its pay in relation to the market is the result of balancing its ability to recruit and retain qualified applicants in relation to the budgetary resources available. As relevant labor market rates fluctuate in response to supply and demand of labor and other economic factors, pay ranges may be adjusted with the appropriate budgetary approval(s).

As a general philosophy, VUMC compares average salaries in the market to its pay range midpoints. The market is defined by the industry(s) and region(s) in which we compete for qualified applicants where warranted. Market adjustments may be recommended for jobs with high turnover or low supply of qualified applicants. Market adjustments are not always applied to all employees in the classifications or job families receiving the adjustments. For example, employees who are high in the range or employees who are low in the range based on performance difficulties may be excluded. For more detail about factors to be considered regarding range placement, please see the range placement in the pay guidelines below.

Performance Increases

There are several performance management systems in place throughout the institution, which differ in terms of compensable factors, frequency, and method of distributing pay. However, all of the performance management systems are designed to reward employees for achieving levels of performance. There is no such thing as a cost-of-living-adjustment at VUMC, and performance increases should not be treated as such. Differentiation in pay should be tied to documented performance, and performance expectations and accomplishments should be regularly reviewed with and communicated to employees.

Equity Adjustments

There should be some relative consistency in terms of where employees fall within pay ranges relative to other peers. Using the Pay Guidelines in salary decisions should promote pay equity. However, if there are inequities that result from historic inconsistencies, individual salaries may be adjusted on a forward-going basis as appropriate. There may also be situations where the external market requires the department to hire new employees at salaries higher than more experienced current employees. Given these situations, current employee salaries should be reviewed and may be adjusted as appropriate. Typically, equity adjustments are based on relative experience, relative education, skills and performance. Please refer to the Pay Guidelines for more details. The Office of Compensation, HR is available to consult with managers and supervisors prior to implementing or communicating equity adjustments.

Other links:

Compensation Philosophy and Principles

Pay Guidelines

New Positions and Reclassifications


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