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Salary System and Performance Related Pay

Salary System and Performance Related Pay. “Building a Professional Civil Service in Kosovo” Pristina, 26-27 June 2008. Mr Peter Reinberg Austria. A. Salary systems in Europe. Austria 8,4 mio inhabitants 84.000 km 2 9 regions traditional civil service systems still career-based

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Salary System and Performance Related Pay

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  1. Salary System and Performance Related Pay “Building a Professional Civil Service in Kosovo”Pristina, 26-27 June 2008 Mr Peter Reinberg Austria

  2. A. Salary systems in Europe • Austria • 8,4 mio inhabitants • 84.000 km2 • 9 regions • traditional civil service systems • still career-based • civil servants

  3. A. Salary systems in Europe • Austria • contractual public employees • biennial steps • fixed salaries for highest functions • uniform public service law in discussion

  4. A. Salary systems in Europe • Austria • position-based salary systems • federation – basic salary and function allowance • Vorarlberg – 29 grades • Upper Austria – Hay 25 grades • Styria – Hay 24 grades • Lower Austria – Hay 25 grades • Tyrol – 25 grades • equal pay for civil servants and contractuals • flattened salary curve • extra costs 2 % per year

  5. A. Salary systems in Europe • Belgium • 3 regions • 3 communities • salary systems essentially career-based • life-long statutory basis

  6. A. Salary systems in Europe • Belgium • A = university degree (master) • B = higher education, short studies (bachelor) • C = higher secondary school certificate • D = no special school certificate • allowances • management and staff functions (fixed salaries)

  7. A. Salary systems in Europe • European Union • life-long appointment as official • "other servants" under contract • basic salaries grade and step • allowances • AD (Administrator) AD5 to AD16 • AST (Assistant) AST1 to AST11

  8. A. Salary systems in Europe • Germany • civil servants • classical system – maintenance principle • basic salary • allowances • A, B – civil servants • A16 – highest • W – professors • R - judges

  9. A. Salary systems in Europe • Germany • public employees • collective agreement – "Länder" (regions) • 15 pay groups (E grades) • E15 – highest • steps by function of professional experience • steps 4-6 additionally by function of individual performance

  10. A. Salary systems in Europe • Moldavia • basic pay related to grade • pay supplements • performance-related bonus: 50 % of monthly salary • OECD recommends max. 10 - 20 % variable performance-related pay • decompression ratio only 2,5

  11. A. Salary systems in Europe • Portugal • New System of Remuneration (NSR) • still a career system • various professional groups • points between 100 and 900 (general scale) • index 2008: 333,61 Euro • allowances

  12. A. Salary systems in Europe • Spain • career system • life-long statutory basis • 30 levels (grades) • 5 groups A-E • Basic remuneration • sueldo • triennial (seniority)

  13. A. Salary systems in Europe • Spain • Supplements • level supplement (grade) • specific job supplement • performance related pay • gratifications (bonuses) • Compression ratios 2,1 :1 – 19,7 : 1

  14. B. Performance Management • scepticism towards performance related pay (PRP) • Germany 2005 reform project • performance variable of 2 %, 4 %, 6 % or 8 % • bureaucracy expected • current discussion: improving the bonus system

  15. B. Performance Management • pros and cons – Francisco Cardona • difficult costly and time-consuming • only applicable at senior levels • no dealing with underperformance • improvement in performance or quality of the service not proven

  16. B. Performance Management • performance management easier to manage if it has no direct link to pay • part of the general strategic procedure • strategic goals • annual goals object of "contracts" • dialogue on goals, degree of their achievement and reasons for it

  17. B. Performance Management • performance dialogue • proposals for personal development • individual training needs • horizontal mobility • career planning

  18. C. Salary System for Kosovo • Salary reform as part of a broader administration reform • Political leaders • realistic budget frame

  19. C. Salary System for Kosovo • Strategic objectives • personnel of sufficient quantity and quality • being competitive to the private sector • ensuring civil servants´ motivation • fairness of the system – equal pay for equal work • giving security and stability to civil servants • higher contributions paid off in reasonable and transparent form

  20. C. Salary System for Kosovo • reform team • HR specialists • administrators • unions • external experts

  21. C. Salary System for Kosovo • guidelines of a reform • all-in monthly salary • position-based system • 16 grades • job families by general regulation of the central HR authority • salary tabloid with seniority steps • flattened life-earning curve • reasonable decompression rate of 5 or 6

  22. C. Salary System for Kosovo • guidelines of the reform • fixed salaries for the highest managerial (and judge) functions • appointment revision and renewal every 5 years, except judges • no elaborated PRP-system • bonuses 1 % of the personnel budget – partially decentralized • only 2 performance rates: adequate/not adequate • "not adequate" – 10 % deduction – second time dismissal

  23. Thank you for yourattention!

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