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Compensation Models

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Betsy Ripley, MD, MS, RAC
Senior Associate Dean, Office of Faculty Affairs
Virginia Commonwealth University School of Medicine

Faculty affairs offices may assist with salary determinations as part of an offer for employment, changes in salary for merit and productivity, and bonuses. This is usually done in conjunction with the financial officer of the school and may require approval through the university financial administration. Whether you are actively determining salaries and helping make decisions about compensation plans or not, as a faculty affairs professional, knowing the policies and general guidelines is important in order to discuss them with faculty. At many institutions, the faculty affairs dean will be a part of the budget, salary negotiations, and design of compensation plans. While you are not the financial expert, you know your faculty, their work, and their concerns, and you can speak to that as decisions are made.

For basic health science faculty salaries, usually an annual salary may be supplemented by leadership roles. Some schools have developed metrics to reward grant submission or funding, patents and licensure, manuscripts, teaching, and leadership roles. When determining salary equity, it is important to recognize differences across departments. You or someone at your institution should have access to the AAMC Faculty Salary Report, which provides salary data by rank and area of specialty, as well as by school geographic region and public/private status. When looking at the data for salary ranges, note the number of individuals reported in a group. Some of these groups are small, and you may need to look at other sources of data. Some organizations in certain areas of work (e.g., biostatistics) also produce data regarding salary.

A significant stressor for clinical faculty is their compensation. Their salary is usually driven by clinical productivity, and therefore they are encouraged to increase their clinical care. This creates the challenge of balancing the clinical drive with other academic missions, many of which are unfunded and do not contribute to their salary. Most institutions have instituted compensation plans for clinical faculty. These take many forms but usually include productivity (Work Relative Value Units), base salary, and a variable component based on research support and supplemental roles such as leadership. Teaching may be measured by Educational Value Units or may factor in rank. Many organizations also include an incentive for productivity over a defined goal. Compensation plans should be understandable, transparent, and sustainable. A single compensation plan may not be adequate for all types of clinicians. You should be aware of how your faculty compensation is determined. Being involved in determining changes or components to the plan will help you advocate for your faculty.

Compensation for both basic health scientists and clinicians should be evaluated for equity. The AAMC has published a report on this topic: Promising Practices for Understanding and Addressing Salary Equity at U.S. Medical Schools. This report provides data on trends in faculty compensation, gender disparity, and strategies for evaluating this complex topic at your institution.

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