Connecticut State Management Advisory Council

Salary Compression

Inconsistencies in the methods for implementing managerial salary increases versus those of employees covered by bargaining unit agreements have led to situations where the pay of supervised staff is close to or exceeds the supervising manager.

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Date Issue Raised: Issue was raised in the 2002 MAC Survey. 

Date of Last Action: 12/3/2007

Last Action Taken:Correspondence was sent to the OPM Secretary indicating MAC's continued concern with the salary compression issue. This correspondence also indicated MAC's interest in introducing our council to members of legislative leadership. This would provide an opportunity to advance our concerns for the future State of Connecticut workforce, specifically as it relates to recruiting and maintaining a skilled managerial corps and the impact salary compression has on such recruitment and retention. Read the correspondence. (PDF, 20KB)

Background: Two thirds of the respondents to a 2002 MAC survey of state managers identified salary compression as a problem.  Over half of respondents reported being personally affected by it. Given Cost of Living Adjustments and the increased number of pay steps available to the bargaining units, the salaries for union personnel are increasing at a faster rate than those of managers. In addition, the union salaries have in many instances a higher upper limit than the supervising manager. 1

Options for Resolution:

  1. Increasing the amount of money available for managers’ raises will help managers who are not at the top of their pay grade.  In 2002 over half of survey respondents indicated they were at the top of their pay grade.
  2. Increasing the position rate/maximum for the managerial pay plans – i.e. the equivalent of adding steps to the collective bargaining pay plans.

Talking Points:

  • Budget impact.
  • Salary as a performance motivator.
  • Impact on retirement costs mitigated by declining value of dollar over time.

    • History of Actions Taken:

    May 19, 2006: A meeting between OPM, DAS and the MAC Executive board was held on May 19,2006.  At that meeting the problem of salary compression between supervising managers and their staffs was again discussed in detail.  In this discussion the MAC Board presented anecdotal information on the impact of compression.  NOTE: Previous presentations by the board, though limited, were based on objective statistics.  The topics brought forth by the MAC Board included the following:

    • Inability to hire qualified candidates from the outside because of the salary structure
    • Inability to promote union personnel to managerial ranks due to loss of base pay, loss of overtime pay and the longer work week
    • Inability to address manager’s morale issues when supervised employees earn more than the supervisor even though both have significant years of service

    OPM and DAS agreed to study the issue and to make adjustments where appropriate.  It was the consensus of the group that most of the compression issues would be found in the agencies providing human services.  This is where the study and remedial action would start.

    Since that meeting, compression issues have be found and documented in DOIT and DOT.  These have been forwarded to DAS for their inclusion in the study.

    December 12, 2005: At a meeting of the MAC Executive committee with OPM and DAS, Secretary Genuario recognized that it is an important issue and one which he is also hearing about from concerned agency heads. He agreed to assign Sean McDonough from OPM to do state-wide research for the next meeting.

    Current Status: Open and Active

    Supporting Documents:

    1. State of Connecticut Management Advisory Council Survey Results – 2002

    Visit the State Managers Discussion Center to Comment on This Issue.