State of Florida Broadbanding · PDF fileService First – Broadbanding Report December...

Service First – Broadbanding Report December 2001____________________________________________________ 1

State of Florida

Broadbanding ReportDecember 2001


TABLE OF CONTENTS

EXECUTIVE SUMMARY....................................................................................................................3

INTRODUCTION .................................................................................................................................4Purpose of Report ................................................................................................................................4Why Broadbanding? ............................................................................................................................4

CURRENT CLASSIFICATION SYSTEM ..........................................................................................6Problems with Current Classification System .......................................................................................7

CURRENT PAY SYSTEM ...................................................................................................................8Problems with Current Pay System ......................................................................................................9

PROJECT RESEARCH ACTIVITIES ..............................................................................................10Service First Implementation Team....................................................................................................10Broadband Survey..............................................................................................................................10Pay Survey.........................................................................................................................................11Use of the Federal Standard Occupational Classification ....................................................................12Input from Personnel Officers ............................................................................................................13

PROPOSED CLASSIFICATION SYSTEM ......................................................................................14

PROPOSED PAY SYSTEM ...............................................................................................................19The Cost-Neutral Pay Band Option ....................................................................................................20The 25 Pay Band Option ....................................................................................................................21Changes to Pay Progression ...............................................................................................................22

CONCLUSION....................................................................................................................................23

APPENDICES .....................................................................................................................................24Appendix A - List of Pay Plans not included in reportAppendix B - Crosswalk between existing classes and proposed broadbandsAppendix C - Class/Levels with less than ten positionsAppendix D - SOC ModificationsAppendix E - Occupation Performance FactorsAppendix F - Cost Neutral Pay Bands Comparison of Pay DataAppendix G - 25 Pay Bands Comparison of Pay DataAppendix H - Broadband Design with Position and Class Count

http://fcn.state.fl.us/dms/hrm/BROADBAND/appendixa.PDF

http://fcn.state.fl.us/dms/hrm/BROADBAND/appendixb.PDF

http://fcn.state.fl.us/dms/hrm/BROADBAND/appendixc.PDF

http://fcn.state.fl.us/dms/hrm/BROADBAND/appendixd.PDF

http://fcn.state.fl.us/dms/hrm/BROADBAND/appendixe.PDF

http://fcn.state.fl.us/dms/hrm/BROADBAND/appendixf.PDF

http://fcn.state.fl.us/dms/hrm/BROADBAND/appendixg.PDF

http://fcn.state.fl.us/dms/hrm/BROADBAND/appendixh.PDF


EXECUTIVE SUMMARY

Among many changes to State of Florida personnel practices, Governor Bush’s Service First initiativethat was passed into law by the Florida Legislature during the 2001 regular legislative session (Senate Bill466) established parameters for totally restructuring the state’s job classification and pay system. Thislegislation limits the number of occupational groups in Florida’s personnel system to no more than 50,and provides for a maximum of six classification levels for each occupation within an occupational group,thus essentially establishing a limit of 300 job classification levels for the State Personnel System. Thelaw also states that the accompanying pay plan shall provide broad-based salary ranges for eachoccupational group.

The reason these changes were enacted into law is simple: Those familiar with the existing cumbersomejob classification procedures are aware of the system’s inability to support the necessary level ofmanagement flexibility. For supervisors, narrow job classification definitions lead to difficulties inassigning responsibilities that are new or different yet still within the general scope of work expectations.For employees, lack of career progression is the unfortunate outgrowth of the narrow job classifications,which often leads productive workers to change positions and/or agencies to seek recognition and rewardsfor superior performance elsewhere.

To implement the Service First mandates outlined above, this report recommends adoption of abroadbanding personnel classification and pay system for the State of Florida. The proposedclassification system would decrease overall administrative workload by reducing the need to reclassifyjobs due to new work assignments or organizational changes. The proposed pay system would allowmanagers to move employees through expanded pay ranges and provide salary increases or lump-sumbonuses, again without the need for frequent job reclassifications. The new pay system would no longerbe based upon numerous, narrow pay grades, but rather broad pay ranges or broad bands. Broadbandingis representative of cutting-edge practice in human resources management, and offers a logical path tomodernizing Florida’s antiquated personnel system.

The proposed broadband system would be used by all executive branch state agencies, and shallencompass the Career Service, Selected Exempt Service, and Senior Management Service classes, whichtogether total more than 120,000 positions. Personnel not included in broadbanding by the legislation orin this proposal are employees of the legislative and judicial branches, elected officials, Lotteryemployees, and those in other miscellaneous pay plans (see Appendix A).

In creating the proposed broadbanding system, meeting the requirements of Service First formed the basisof the research and design methodology. The Federal Standard Occupational Classification (SOC) systemwas chosen as the structural foundation for the new system, and performance factors were developed inorder to determine placement of the existing 3,343 job classes into the broadband levels. The research anddesign work done on the proposed structure for the new classification and pay program resulted in thefollowing:

• Consolidation of the 3,343 classes into 38 occupation groups with 3 to 6 levels in each resultingin 145 broadband classification levels.

• Reduction in the number of pay grades from the current 475. In one approach, a cost-neutral payband was assigned to each of the 145 levels. In another, a set of 25 pay bands with standardizedintervals and widths was developed and applied to the broadband classification levels based onbest fit to current salary data.

As required by Senate Bill 466, the proposed system is in anticipation of existing statutory language onclassification and pay expiring on June 30, 2002.


INTRODUCTION

Purpose of Report

Among many changes to State of Florida personnel practices, Governor Bush’s Service First initiative,passed into law by the Florida Legislature during the 2001 regular legislative session (Senate Bill 466),directed the Department of Management Services (DMS) to revise the current state employee jobclassification and compensation system. Specifically, the legislation stated that DMS, in consultationwith the Executive Office of the Governor and the Legislature, was to develop a new classification andpay program. This new program is to be utilized by all state agencies and employees of the StatePersonnel System, which encompasses the Career Service, Selected Exempt Service, and SeniorManagement Service employee classes. DMS was directed to submit a report on the proposed design ofthis classification and pay program to the Executive Office of the Governor, the presiding officers of theLegislature, and the appropriate legislative fiscal and substantive standing committees on or beforeDecember 1, 2001.

Specific requirements of Senate Bill 466 include the following:

• Development of a position classification system using no more than 50 occupational groups and amaximum of six classification levels for the jobs contained in each occupational group, thusessentially establishing a limit of 300 job classes for the State Personnel System. Only the ExecutiveOffice of the Governor may establish additional occupational groups after consultation with theLegislature.

• Development of a pay plan that shall provide broad-based salary ranges for each occupational group.

• Sunset of relevant current statutory language on classification and pay effective June 30, 2002.

In fulfillment of these Service First legislative mandates, this report presents information on the State ofFlorida’s existing personnel classification and pay system, points out the weaknesses of this system,discusses the activities undertaken in researching alternatives to the current system, and provides detailsfor a proposed new classification and pay system based on the principles of broadbanding – an approachto personnel system management that emphasizes occupational groups and pay ranges that are fewer innumber but larger in overall breadth.

Why Broadbanding?

The Service First legislation contained the following goals that were to be addressed in reforming thestate’s current classification and pay system:

• The classification system must significantly reduce the need to reclassify positions due to workassignment and organizational changes by decreasing the number of classification changes required.

• The classification system must establish broad-based classes allowing flexibility in organizationalstructure and must reduce the levels of supervisory classes.

• The classification system and pay plan must emphasize pay administration and job-performanceevaluation by management rather than use of the classification system to award salary increases.


• The pay administration system must contain provisions to allow managers the flexibility to moveemployees through the pay ranges and provide for salary increase additives and lump-sum bonuses.

As to why a new system is needed in the first place, simply put the current State Personnel System hasbecome inconsistent, antiquated and ineffective. At present, the existing system contains 3,343 jobclassifications and 475 pay grades in separate pay plans, with each pay plan having its own set ofgoverning rules. The narrow job duty definitions and salary ranges embodied in the existing classificationand pay system have contributed to inflexible and ineffective personnel administration. Job classificationactions, rather than being based on actual agency needs or actual work performed, have instead become aback-door method of providing good employees with raises for retention purposes. In those cases wherereclassification is not an available option, valuable workers are frequently lost when they “class-hop” toanother job, often to a different agency.

In addition to these fundamental difficulties, management flexibility has been hindered by the currentsystem -- because many job classifications are so specifically written that new responsibilities cannotalways be given to those employees best suited to accomplish the work. This unfortunate situation existsalso to the detriment of employees who could otherwise improve their skills and knowledge base. Overtime, this undermines overall employee development and runs counter to the enhancement of agencyperformance and achievement.

Finally, the present classification and pay system conflicts with the state’s ongoing efforts to bettermanage information needs and streamline administration. Florida’s highly vertical traditional personnelsystem, with its multitude of job classification and pay grades, is outdated when compared to stategovernment structures that are becoming flatter and more team-oriented. Our current system, developedin the mid-1960s with few revisions, is geared toward rewarding employee longevity rather thanperformance. Today, state agencies are expanding horizontally and require a personnel system thatrewards workers for lateral job growth and their contributions to the agency mission. It is the limitationsof the existing system and the possibilities for improvement that prompted the inclusion of broadbandinglanguage in the Service First legislation.

In brief, a broadbanding-based system collapses many narrow classifications and pay grades into arelative few broad classifications and wide pay “bands” that form the foundation for managing personneland administering pay. Broadbanding supports the transition to flatter organization structures andutilization of a higher-talent workforce. Instead of emphasizing titles, pay grades, and job descriptions,the focus of broadbanding is to utilize a system that provides incentives for employees to increase theirjob-related value by developing new skills and contributing to improve agency service. Broadbandingencourages workers to acquire additional knowledge so they may adapt to new roles and make lateralmoves in response to organizational needs, through the creation of a supportive environment foremployee cross-functionality, team development, and the ability to receive rewards within a broader payrange. The result of implementing a broadbanding classification and pay system can be that personneladministration is simplified, agencies are more responsive to their customers, and employee careers aremore satisfying.

To summarize, Florida’s adoption of a broadbanding classification and pay system will be an importantcomponent of how the state deals with the challenges of increased demand for government services withongoing technological advancements, and the need to continually improve organizational effectiveness tobetter serve its citizens. The State of Florida will benefit from the support of a human resource systemthat promotes job flexibility, allows agencies to make the most of their available employees’ skill sets,and affords the opportunity and structure to reward employees by encouraging development andperformance.


CURRENT CLASSIFICATION SYSTEM

The State Personnel System is comprised of about 120,000 positions within the Career Service, SelectedExempt Service, and Senior Management Service. Each service has a separate job classification plan.These plans group employees into job classifications based upon similar kinds of work, levels of jobdifficulty or responsibility, and qualification requirements that warrant similar treatment.

The Career Service Classification Plan is the largest of the three pay plans, encompassing over 90,000positions assigned to 984 “classes” based on job similarities. A class specification identifies thefollowing information for each classification, or similar employee group:

1. Class code – number assigned to a class of positions2. Class title – official name assigned to a class of positions3. Allocation factors – statement of duties/responsibilities that indicate type and level of work4. Examples of work5. Knowledge, skills, and abilities (KSAs) – minimum proficiencies, aptitudes, and knowledge to

perform tasks6. Minimum qualifications – lowest level of qualifications to be eligible for position consideration,

including experience, training, education, and certification. (Selected Exempt Service classes thatrequire licensure or certification per the Florida Statutes also have class specifications thatstipulate the legal requirements)

7. Establish date and revision date(s)

In addition to the above, an annual pay plan is published that contains the following information abouteach classification:

1. Pay grade and range2. Fair Labor Standards Act code – this is a designation of included or excluded for overtime

purposes3. Retirement category4. Equal Employment Opportunity code5. Collective bargaining unit designation6. Probationary period

The Selected Exempt Service Classification Plan covers about 21,000 positions and 1,890 classifications,while the Senior Management Service Classification Plan covers 530 positions and is comprised of 424classes. Compared to those within the Career Service Classification Plan, each position in these twosystems is more likely to have its own class. For example, each state agency has a Selected ExemptService class specifically for its General Counsel, e.g., General Counsel for the Department ofTransportation and General Counsel for the Department of Corrections. If the General Counsel positionwere in the Career Service, only one class would exist for all General Counsels.


Senior Management and Selected Exempt Service classes are assigned the indicators below:

1. Class code2. Class title3. Pay grade4. FLSA code5. Retirement category6. Collective bargaining unit7. Minimum Qualifications if required by statute.

Problems with Current Classification System

In addition to the shortcomings discussed earlier, the following are some basic problems that can beidentified with the current classification system:

• The existing system is antiquated, built for the needs of the workforce almost 40 years ago.

• The system allows for redundancies in class use between pay plans. For example, the title ofInspector General appears in the Career Service, the Selected Exempt Service, and the SeniorManagement Service.

• As an outgrowth of narrow job classes, the system contains outdated classifications. Forexample, the Clerk Typist class is still used in the system even though computers have longreplaced typewriters and the original purpose of this class no longer exists.

• The system lacks an adequate amount of paraprofessional classifications. This results in misusingclasses such as Senior Clerk and Administrative Assistant in place of position classifications thatwould serve as an appropriate starting point for professionally based career paths.

• Existing minimum qualifications on the class specifications do not support position dutiesbecause classes are no longer used as designed. Originally, classes were needed to assign typesof work, and were therefore assigned qualifications. Today, classes are used for their pay range.

• The system contains numerous inconsistencies in overall position classification depth andbreadth. For example, the system has classes as specific as Accountant II, which is very narrowlydefined and leaves no flexibility for management to utilize the position for other related agencyneeds. On the other hand, classes such as Operations and Management Consultant and SeniorManagement Analyst are so broadly defined that the actual type of work performed by employeesin these positions varies widely across agencies.

• The number of classifications used in the State Personnel System has grown to over 3,000 titles.This is a result of the delegated authority to agencies and a common philosophy that uniqueagency missions required developing specialized job classifications. For instance, several classeshave been developed to perform financial auditing duties based on agency specific regulatoryfunctions -- even though these auditing jobs can be captured in one class because they require asimilar education and experience background and utilize the same knowledge, skills, and abilities.Consequently, over the years this classification system, which is to categorize like jobs, hasbecome a "job description" system.


CURRENT PAY SYSTEM

The State of Florida utilizes multiple pay plans. Three of these plans -- the Senior Management Service,the Selected Exempt Service and the Career Service -- are subject to the classification and pay provisionscontained within the Service First legislation. The Department of Management Services is responsible fordeveloping and maintaining each pay plan and for promulgating associated administrative rules.

Each of these pay plans contain pay grades that range from a minimum to a maximum amount. SomeCareer Service pay grades have pay steps (intervals) that ascend from the minimum to the maximum. TheCareer Service pay plan consists of about 246 pay grades, with pay minimum-to-maximum spreadsvarying from 40 percent to 250 percent. The Selected Exempt Service pay plan has 194 pay grades withminimum-to-maximum spreads ranging from about 45 percent to 250 percent. The Senior ManagementService pay plan has six pay grades with minimum-to-maximum spreads of 100 percent to 200 percent.The Executive Office of the Governor uses another 29 pay grades with spreads of 46 percent to 73percent.

Agencies have the day-to-day authority to assign pay to new hires as well as determine future payincreases. New hires into Career Service are usually paid at or just above the minimum of the pay grade.Future pay increases1 for Career Service employees are in the form of either a permanent “base rate” ofpay increase (e.g., promotion) or as a pay additive for specific reasons (e.g., temporary special duty).Specific reasons for pay increases are defined in DMS rules. Below are the categorical reasons justifyingincreases to base rate of pay (an employee may only receive one increase per category below within a 12-month period.):

• Superior proficiency – based on documented sustained superior performance

• Added duties and responsibilities – does not warrant a reclassification

• Education and training – satisfactory completion of a job-related class or program that benefits theagency

• Reassignment – may require reclassification, based on recruitment difficulties and must be under50 miles

• Transfer – based on recruitment difficulties and must be over 50 miles

• Competitive job offer – to counter a documented bonafide job offer

• Internal pay relationships – an increase for current employees to provide pay equity if a new employee is hired at a higher starting salary than current employees in the same class

Pay additives are not permanent increases to an employee’s base rate of pay, and can be adjusted orremoved based on the circumstances. Pay additives can be approved per position by the agency, with theexception of temporary special duty pay, which needs approval from DMS and the Governor’s Office ofPolicy and Budget if beyond 90 days. Below is a list of pay additives:

• Competitive area differential – CADs are approved at the class level in a certain geographical area,based on documented recruitment, turnover or competitive pay problems

• Shift differential – approved at the class level

• On-call – determined by the agency

1 This excludes any pay increase approved by the Legislature, such as an annual across-the-board pay increase.


• Leadworker – does not warrant a reclassification

• Coordinator - does not warrant a reclassification

• Temporary special duty – for performing work not customarily assigned

• Trainer – for providing on-the-job training, this is work not customarily assigned

• Hazardous duty – for performing duties that are exceptionally hazardous or dangerous

Pay decreases can be made by way of a demotion, a disciplinary action, or voluntarily in lieu of potentialworkforce reduction in personnel.

Unlike Career Service employees, Selected Exempt Service and Senior Management Service employeesmay only receive pay increases to base rate of pay. Discretionary base rate of pay changes can be madeby the employing agency based on performance or as otherwise deemed appropriate. The agencies are toinform DMS of all Selected Exempt Service and Senior Management Service pay changes.

Problems with Current Pay System

In addition to the shortcomings discussed earlier, the following are some basic problems that can beidentified with the current pay system:

• The existing system is antiquated, built for the needs of the workforce almost 40 years ago.

• The system lacks any effective pay for performance mechanisms.

• The system allows for inconsistent application of pay assignments for similar work. For example,depending on the agency employees with the title of Public Information Officer may be paidunder one of three different pay plans, with varying entry-level salaries.

• Reward systems are too closely associated with reclassifications or promotions, rather thanmovement through a pay range based on job performance or agency need.

• Career development incentives are limited. Employees are not encouraged and rewarded forlearning new skills within their present job assignments. This lack of managerial flexibility totrain, motivate, and reward employees has lead to “class hopping”. Class hopping occurs whenemployees are retained and rewarded by manipulating the classification system for pay relief.This practice may temporarily benefit the employee but is neither beneficial to the State nor to thelong-term career of the employee.


PROJECT RESEARCH ACTIVITIES

The Department of Management Services began the research into this project by bringing together anumber of resources to help develop the proposed classification and pay program. A workgroupconsisting of selected agency management, Governor’s Office employees, and Legislative staff wasformed to provide overall project policy guidance. Personnel officers from all affected agencies wereassembled in a series of workshops to provide technical input and feedback. Survey information onclassification and pay practices was collected from other states and entities utilizing broadband personnelsystems. DMS also examined in detail the federal model classification system, and based the structure ofthe proposed broadbanding system on this model.

Service First Implementation Team

To assist DMS in the development of the proposed classification and pay system, a workgroup wasformed from subject matter experts from the:

• Department of Transportation• Department of Labor and Employment Security• Department of Veterans’ Affairs• House and Senate• Governor’s Office of Policy and Budget

The workgroup met several times between July 2001 and October 2001. DMS staff attended theworkgroup meetings to discuss components of the broadband design, and to offer suggestions onclassification and pay policy. Agency personnel officers from the Florida Departments of LawEnforcement, Environmental Protection, Children and Families, Agriculture and Consumer Services, andCommunity Affairs, as well as the Agency for Workforce Innovation, were also invited to workgroupmeetings and attended on several occasions to provide additional input on the technical details of theproposed broadbanding design, as well as its application to their agencies.

Broadband Survey

Five organizations that currently use a broadband classification and pay system were interviewed for thepurpose of gathering information on different system design types, applications, benefits, and challenges.Organizations contacted were: State of Virginia, State of South Carolina, Tufts University, City ofTallahassee, and Florida’s Department of Transportation (DOT). Questions asked about their systemscovered the following:

• Date of implementation• Reason for implementation• The employee groups to which broadbanding was and was not applied• Design structure of the broadbands• Movement within/between broadbands• Pay change mechanisms, e.g., promotion, pay additives• Successes• Challenges• Suggestions


All survey participants were relatively new users of broadband systems. Their reasons for implementingsuch a system parallels those applying to the State of Florida: a cumbersome classification system andinflexible pay system, equating to an ineffective personnel management approach requiring excessiveadministration.

The survey participants reported that transitioning to broadbanding has reduced the number of positionclasses and pay grades by at least 60 percent and as much as 95 percent. South Carolina implemented thegreatest change by consolidating about 2,500 job classes to just under 500 and 50 pay grades to 10. Paybands were increased in width by each of the surveyed entities, with established pay band ranges from 80percent to 130 percent. Pay band intervals, or the differences between pay band minimums, varied from10 percent to 40 percent.

The organizations interviewed reported similarities in the methods that employees can progress throughpay bands. Four of the five entities allow for “in-band” salary adjustments, equivalent to the State ofFlorida’s base rate of pay increases. Reasons for in-band adjustments included greater duties andresponsibilities, certification attainment, internal salary inequities, new skills, and retention needs. LikeFlorida, Virginia offers a cost-of-living differential based on geographic location of the job. Virginia alsoprovides for agency-specific “competitive differentials” for selected positions, based on local job marketcompetitiveness. All five organizations provide the opportunity to award bonuses and pay forperformance. They also utilize promotions and demotions between and within the bands.

When the survey participants were asked what challenges they faced and for advice on broadbandingimplementation, their comments were similar:

• Build a system that is easy to administer• Provide sufficient and continuous education to employees and managers• Ensure management accountability for pay decisions• Allow time for the cultural change to occur among employees. Remember that although flexible

pay adjustments are possible, sufficient funding must be available• Do not leave vestiges of the old system in place

Pay Survey

In addition to information collected on how broadbanding has been designed and implemented, DMS alsoresearched the pay practices of other organizations. Therefore, in addition to the five entities surveyed onbroadbanding, several other organizations were contacted. DMS received pay information from fouradditional state governments and four private sector companies. The surveyed organizations were:

• SunTrust Banks, Inc.• Tropicana Products, Inc.• Uniroyal Technology Corporation• Watkins Motor Lines, Inc.• State of Pennsylvania• State of California• State of Georgia• State of Texas


All of the entities contacted provide base pay increases due to merit, across-the-board pay increases, orboth. Five provide for pay increases based on performance only (Texas, Georgia, Virginia, WatkinsMotor Lines, and Tropicana). Uniroyal Technology is the only private sector firm that offers an across-the-board pay increase in addition to merit pay. The amount of merit and across-the-board pay increasesare determined annually. States surveyed are appropriated a percentage amount for pay increases, whilethe private sector firms distribute a percentage to be used for merit and/or other pay adjustments. Someof the organizations provided the following additional information:

• Like the State of Florida, four of the surveyed organizations (Watkins Motor Lines, SunTrustBanks, and the states of Pennsylvania and Texas) give a lump sum bonus in lieu of an increase tothe base rate of pay if the employee is currently at the maximum of the pay range.

• Watkins Motor Lines reduces the pay increase percentage the higher the employee is in the payrange.

• SunTrust Banks in some cases provides for “extended salary reviews,” where pay increases arenot given annually, but are based on 15 to 18 month pay cycles. This approach is utilized whenan employee’s salary is high in a pay range, yet performance has been modest. This companyalso uses “accelerated salary reviews” when the employee’s performance is high, yet his/her payas compared to the market average is substantially deficient.

• South Carolina does not require annual pay increases to be linked to performance appraisals;however, any pay reductions must be tied to the appraisal.

Performance bonuses are also funded by all of the surveyed organizations. Most are distributed annually;however, Watkins Motor Lines also provides for quarterly bonuses. One company (SunTrust Banks)grants, “spot bonuses” for unique, one-time performance contributions. California has a special planwhereby up to six percent of the supervisors within a department can receive a $250 to $750 bonus,depending on the number awarded. Pennsylvania allows managers to give other managers up to a $1,500bonus per year.

Finally, other than merit pay increases, across-the-board pay increases, and bonus pay, organizationscontacted also offer base pay increases at any time of the year for reasons such as recognition of assumingadded duties and responsibilities, high job performance, internal inequity adjustments,educational/training attainment, and competitive job offers. Texas was the only organization to offer apay increase that recognizes longevity for service of more than five years with the state. California offersthe most unique pay increases – flight pay, bilingual pay, and avalanche control pay.

Use of the Federal Standard Occupational Classification

DMS designed the broadbanding structure proposed in this report using the Federal StandardOccupational Classification System as a foundation. Formerly known as the Dictionary of OccupationalTitles, the Standard Occupational Classification is a grouping and numbering system that describes thevarious types of work performed in the public and private sectors. Surveying employers in both thepublic and private sectors to determine the work elements associated with working titles, the U.S.Department of Labor has constructed an extensive occupational database. This data is also used to linkoccupations within occupational groups, and provides a system that serves as a common language,cataloging most jobs that are performed in the United States. The Standard Occupational ClassificationSystem has been used for:

• The 2000 US Census


• Federal Bureau of Labor Statistics Product Development• Conducting Pay Surveys• Assisting Managers in Building Class Specifications and Job Descriptions• Determining Hiring Guidelines (typical education and experience)

Input from Personnel Officers

From the beginning of this project, input from the State’s agency personnel officers was essential to thecreation and modification of the proposed broadband system design. As both experts and customers, thepersonnel officers’ involvement was sought to ensure the proposed system could be transitioned to with aminimum of difficulty, and would also be successfully implemented on a long-term basis. AlthoughDMS has the policy expertise in this area, agency personnel staff have the practical experience of usingthe current classification and pay system. Personnel officers also know first-hand the types of workemployees perform, the classes they are in, and the pay they receive. To start, DMS asked the personnelofficers for feedback on the general structure of the initial broadband system design. Once the basicbroadbanding classification system framework was established, agency personnel staff then participatedin 13 workshops involving almost 30 hours of intense review of what employees do and where theyshould be placed within the new broadband classification system. The goal of these workshops,consisting of several “group hall” sessions, and additional one-on-one meetings concerning agency-specific classes, was to reach a level of consensus between DMS and the agencies on the final crosswalkbetween current job classes to the proposed broadband system.


PROPOSED CLASSIFICATION SYSTEM

The proposed design of the broadband classification system modernizes our outdated system. Thevoluminous number of narrowly defined classes of employment with fragmented relationships have beenbroadened and realigned, so that the existing 3,343 classes have been consolidated into 145. Toaccomplish this, DMS used a uniform job categorization system made up of broadly defined job familiesdivided further into occupational groups and occupations based on the Federal Standard OccupationClassification System (SOC). A crosswalk between existing classes to the proposed broadband levels isshown in Appendix B. The number of positions combined into a level ranges from one to more than11,000. Appendix C lists and explains those instances where an occupational group containslevels/classes populated by less than 10 positions. In summary, the proposed broadband classificationsystem consists of:

• 22 job families – Job families are groupings of similar occupational groups. One example of ajob family is “Legal”. Within the job family of Legal are two occupational groups.

• 38 occupation groups –Occupational groups are similar occupations grouped together. Oneexample is within the Legal job family are two occupational groups: “Lawyers and Judges” and“Legal Support.”

• 231 occupations - Within the Legal Support occupation group, the occupations are courtreporters, law clerks, and paralegal/legal assistants.

• Sub-occupation – Sub-occupations are specific jobs within occupations. This division enablespersonnel staff and employees to more readily recognize why a group of employees was placedin a particular occupation. Within the court reporter occupation group, the sub-occupation arecourt reporters and hearing reporters.

• 145 occupational broadband levels – each occupation group has up to 6 performance levels.Employees within the Legal Support occupation, for example, are divided among 3 levels basedon job performance indicators. (Levels are also associated with pay bands that are addressed inAppendix B of this report.)

The Federal SOC System provided DMS with a proven job classification mechanism. Use of the SOCalso supported the process of determining related pay levels, as well as standardizing the jobcharacteristics of positions allocated to given job families and occupation groups. Underlying thissystem is the SOC coding structure that DMS will use for reporting and costing purposes. Of the jobfamilies listed in the SOC System, DMS used all but one (Military). Below is a chart depicting the 22 jobfamilies and their accompanying 38 occupation groups. Appendix D identifies modifications to the SOCthat were made to capture needs specific to Florida.


JOB FAMILIES OCCUPATION GROUPS

EXECUTIVE

EXECUTIVE/MANAGER MANAGER

BUSINESS OPERATIONS

BUSINESS AND FINANCE FINANCE

COMPUTER

COMPUTER AND MATHEMATICAL MATHEMATICSARCHITECTS, SURVEYERS, ANDENGINEERS ARCHITECTS, SURVEYERS, AND ENGINEERS

LIFE AND PHYSICAL SCIENCE

SCIENCE TECHNICIANS

LIFE, PHYSICAL AND SOCIAL SCIENCE SOCIAL SCIENCEPROBATION OFFICERS AND CORRECTIONALTREATMENT

COMMUNITY AND SOCIAL SERVICES COUNSELING AND SOCIAL WORK

LAWYERS AND JUDGES

LEGAL LEGAL SUPPORT

EDUCATORS AND ADMINISTRATORS

EDUCATION, TRAINING AND LIBRARY LIBRARIANS, CURATORS AND ARCHIVISTS

ARTISTS AND DESIGNERS

ARTS, DESIGN AND MEDIA MEDIA AND COMMUNICATIONS

HEALTH DIAGNOSIS AND TREATMENT

HEALTHCARE PRACTITIONERS HEALTH TECHNOLOGISTS AND TECHNICIANS

HEALTHCARE SUPPORT HEALTH CARE SUPPORT

CORRECTIONAL OFFICERS

DETECTIVES AND CRIMINAL INVESTIGATORS

FIRE FIGHTERSMISCELLANEOUS PROTECTIVE SERVICE - NONSWORN

POLICE

PROTECTIVE SERVICE SECURITY GUARDS


JOB FAMILIES OCCUPATION GROUPS

FOOD PREPARATION AND SERVING FOOD PREPARATION AND SERVINGBUILDING AND GROUNDS CLEANING ANDMAINTENANCE

BUILDING AND GROUNDS CLEANING ANDMAINTENANCE

PERSONAL CARE AND SERVICE PERSONAL CARE AND SERVICE

SALES AND SALES RELATED SALES AND SALES RELATED

OFFICE AND ADMINISTRATIVE SUPPORT OFFICE AND ADMINISTRATIVE SUPPORT

AGRICULTURE

AGRICULTURE AND FORESTRY FORESTRY

CONSTRUCTION AND EXTRACTION CONSTRUCTIONINSTALLATION, MAINTENANCE ANDREPAIR INSTALLATION, MAINTENANCE AND REPAIRPRODUCTION PRODUCTIONTRANSPORTATION AND MATERIALMOVING TRANSPORTATION AND MATERIAL MOVING

The broadband levels (up to six per Occupation Group) were based on job performance indicators. Thisprovided the means to assign a job’s worth, or pay. The higher the level number, the higher the minimumpay of the assigned pay band. Performance factors, long established compensable guidelines used todetermine the overall value of work, were used to delineate which classes of employees belonged towhich level. The factors utilized were developed with the input of the agency personnel officers, who areresponsible for classifying and determining pay for employees within their agencies. The followingfactors were used to distinguish different levels of work within each occupation group:

• Knowledge: measures the technical knowledge required to meet performance standards at aparticular level

• Skill: defines how much preparation and learning through experience and training is necessary toperform at a particular level

• Complexity: measures the degree of difficulty and the general complexity involved in performingwork at a particular level

• Decision-Making: defines the degree of decision-making authority given to a class at a particularlevel

• Autonomy: defines the level of independence assigned to a class at a particular level

• Consequence of Error: measures the opportunity for and effect of errors committed in a level at aparticular level

• Communication: measures the effective handling of personal contacts as well as the importanceof the contacts themselves at a particular level

• Planning: measures the ability to identify goals, define obstacles, select, and develop the bestcourse of action to accomplish an objective


• Supervisory Responsibility: measures the assigned span of control and the organization andleadership required in the guidance of others (at a particular level)

Appendix E lists the primary factors chosen by the personnel officers to determine levels for eachoccupational group.

Should the proposed broadbanding classification system be adopted, the practice of having pre-defined,class-based written minimum qualifications; knowledge, skills, and abilities; and examples of work willno longer exist. The classification to a job family, occupational group, and occupation will address thesefactors as well as the performance factors. Other attributes currently assigned to a class will transition tobeing position-specific. The Fair Labor Standards Act code (FLSA) is one such example. Each of theexisting classes is assigned an FLSA for the purposes of determining whether the employees within theclass are eligible for overtime payments. Broadbanding will require this indicator to be position-specific.This solves a recurring problem where DMS is provided with many classification level exceptions, sincecurrently not all positions in a class are designated with the same FLSA status. The retirement code willalso have to be assigned per position, rather than class. For example, under the new classification design,Senior Management Service classes have been combined with Selected Exempt Service classes.However, different retirement benefits given to SMS and SES employees will need to be delineated byposition.

Adoption of a new broadband classification system will also require several reviews to examine old, out-dated assignments of other class-based indicators -- these include existing class-based assignments of theEqual Employment Opportunity code and collective bargaining representation.

With only 145 broadband classes as compared to more than 3,300 under the current classification system,the State of Florida can expect to reap the benefits of a modern personnel management system, as wasdiscussed in the “Why Broadbanding?” section of this report. To further illustrate, under a pilot projectthe Florida Department of Transportation (DOT) has used a broadbanding system since 1994. As a resultof transitioning from the existing classification system to a broadbanding system, certain savings could bemeasured in the administration of human resource activities.

The DOT experience has shown a 70 percent reduction in the number of position reclassifications, and anearly 60 percent reduction in the number of position adds/deletes. Under the old system, DOT estimatedan average processing time of 50 minutes for each personnel action. Over the last five years, the averageannual number of position reclassifications for all agencies statewide has been 3,442, requiring an averageof 2,868 hours to process. By reducing the number of reclassification actions by 70 percent, overallprocessing time would be cut to 860 hours, saving the State of Florida 2,008 administrative hours per yearon reclassification actions. When adding the time savings derived from a reduction in the number ofadd/deletes, promotions, demotions, and reassignments overall administrative productivity would becomesubstantially greater. Also, the administrative savings described here do not include the time and effortexpended under the current system by managers, administrative workers, and affected employees inpreparing position descriptions, personnel action forms, and other supporting documentation forsubmission to the personnel office. Time savings on these related personnel activities would be evengreater than the direct time savings associated with processing personnel actions. Though time is savedthrough the reduced number of reclassifications, there is a small degree of offset incurred by the increasedemphasis on pay administration due to the increased number and types of employee pay actions providedfor under the broadbanding system.


Other benefits of the proposed broadbanding classification system include:

• The number of reclassification actions will decline significantly.

• The broad-based classes will allow for flexibility in organizational structure and reduce thenumber of supervisory classes.

• Minimum qualifications will become the knowledge, skills, and abilities essential to individualpositions. One exception to this will be any statutory requirements at the occupational group orclass level. Such requirements will continue to be a minimum qualification in addition toposition specific factors.

• Emphasis will be placed on pay administration and job performance evaluation by management,rather than using the classification system to award salary increases.

• Employees may demonstrate and be rewarded for their contribution to the agency without beingburdened by the constraints of narrowly defined job classifications.

• Day to day personnel administration will be less demanding on the state’s limited resources.


PROPOSED PAY SYSTEM

As discussed earlier, the current pay systems under review consist of 475 individual pay ranges, with theminimum-to-maximum spreads varying from a low of 40 percent to a high of 250 percent. It has beenpointed out that along with the current classification system, the Florida’s present pay system isfragmented, lacks consistency, and is designed to reward employees for seniority and vertical jobchanging rather than performance and lateral job/skill development. However, the simplified andmodernized design of the proposed broadbanding classification system has allowed for the developmentof two proposed options for a single broadbanding pay system that would replace the pay systemsmentioned above. The new pay system uses different terminology by replacing “pay range” with “payband.” The proposed options are:

• Using a unique cost-neutral pay band for each of the 145 proposed broadband levels (levels beingequivalent to classes).

• Using a set of 25 pay bands with standardized band intervals and spreads, applied to the proposedbroadband levels based on best fit to current salary data.

Implementing either of these options would result in a substantially reduced number of pay ranges,greater consistency among pay band spreads, rational pay progression between class levels in theoccupational groups, and in many cases a widening of pay ranges to allow for long-term recognition of in-job development and performance.

Development of the proposed pay system options began with a “status quo” analysis of existing pay datafor each of the 145 newly created broadband levels. As a result of consolidating several thousand classesand pay ranges into 145 broadband levels, almost every level consisted of multiple pay ranges. Becauseone of the benefits of broadbanding is to have fewer but wider pay ranges, two distinct groups of costneutral “starting point” pay ranges were created using existing minimum and maximum salaries andapplied to the broadband levels. These pay ranges are displayed in Appendix F and G, and were definedby:

• Existing pay range data – The lowest minimum salary and highest maximum salary of all the payranges consolidated into a broadband level were used to create the pay range for that broadbandlevel.

• Actual salary data – The lowest actual minimum salary and actual highest maximum actual salaryof all employees grouped into one broadband level were used to create the pay range for thatbroadband level. (Note: The current pay ranges and the actual salary figures include the payincrease implemented in November 2001.)

Creating these pay ranges pointed out noticeable differences between the broadband pay ranges and actualsalaries being earned. In some cases, the lowest pay range minimum salary could be, for example,$25,000 for a broadband level, while the actual lowest salary being paid to an employee within that levelmay be $30,000. The highest pay range maximum may be $80,000, yet the actual highest salary beingpaid is $45,000. Pay range widths were also reviewed to help determine the range of an occupation’s jobworth, that is, the range of salary that is commensurate with the work. Examinations like these helpeddevelop pay bands that are more reflective of our workforce and with broadbanding concepts discussedearlier.


It should be noted that market salary data was also reviewed. In 2000, the Department conducted twosalary surveys – one of Career Service classes and one of executive classes. The surveys provided anumber of benchmark average hire salaries. Although informative, less than half the broadband levelsincluded a class that was benchmarked in the survey. Because the surveys were not conducted withbroadbanding in mind, the benchmark classes selected for the surveys do not provide a good fit for thenew broadband levels. Because of this, it was decided not to base new pay bands on the results of thissalary data. However, use of the federal Standard Occupation Codes should afford the state with bettermore accurate market data for future refinement of the proposed pay bands.

The following paragraphs outline the two options presented in this report for utilizing a pay systemcomplimentary to the broadband levels. The first pay system presented is cost neutral to implement(Appendix F), with each broadband level having a customized pay band. The second pay system(Appendix G), although somewhat costly to implement, affords more benefits to the State. Thisalternative pay system has only 25 pay bands assigned to the 145 broadband levels.

The Cost-Neutral Pay Band Option

For the proposed cost-neutral pay system, a single pay range was created and assigned to each broadbandlevel within an occupation group, resulting in 145 pay bands. In trying to achieve broad but consistent payrange widths and guided by the survey information received from the other broadbanding entities, thefollowing parameters were established:

1. A minimum pay bandwidth of 75 percent.

2. A maximum pay bandwidth of 125 percent for the levels contained within all occupation groupsexcept Manager and Executive.

3. A maximum pay bandwidth of 300 percent for the levels contained within the Manager andExecutive occupation groups.

4. Progressive pay bands within an occupational group – no cases in which the minimum of a payband assigned to a given level is less than the pay band minimum(s) for the preceding levels.

Under this option, pay bands were created so that the minimum pay established for any given level didnot exceed the minimum pay range and/or actual salary for that level. In most cases, either the minimumfor the current pay range or the minimum actual salary was used as the minimum of a level’s pay band;the determining factor of which figure was used was essentially based on the current pay range width.

If the current pay range width for a level was less than 75 percent and therefore under the establishedcriteria needed to be broadened, then a pay band of 75 percent was established, usually with the currentpay range minimum as the starting point. Conversely, if the current pay range width for a level was morethan 125 percent and therefore under the established criteria needed to be narrowed, then a pay band of125 percent was established, usually with the actual salary minimum as the starting point. Levels with acurrent pay range width between 75 and 125 percent remained in tact, given modest adjustments to theminimum of the pay band. Exceptions to this methodology for establishing pay bands were based on theprogressive pay principle – if establishing a pay band for a given level using the standard criteria wouldhave resulted in a non-linear progression to the pay bands for that occupation group, then an alternate payband was created for that level that “fit” into the progression. Finally, for the levels within the Executiveand Manager occupation groups the pay bands established were assigned with a width of 300 percent toaccount for these occupations having the greatest disparity between minimum and maximum salaries.


In terms of the broadbanding pay system benefits outlined earlier in this section, the cost neutral approachwould provide the following:

• Reduces the number of pay ranges from 475 to 145, a 69 percent decline.

• Provides greater consistency among pay band spreads; no non-managerial pay band width is lessthan 75 percent or greater than 125 percent.

• Provides a linear and rational pay progression from level to level within each occupation group.

• In many cases the pay ranges for levels are broadened, thus allowing for greater employeemovement within a broadband. Even in those cases were the pay band established did not exceedthe current pay range, it is likely that within the level there are at least some classes under theexisting system with pay ranges less than that established for the level.

Although the title of this approach is “cost neutral,” a cost of less than $15,000 would be required, if theintegrity of the broadbands is retained as well as the properties that define the proposed pay bands. Thecost is associated with one broadband level, that of Level 3 assigned to the Health Diagnosis andTreatment occupation. Due to ensuring a linear progression from one level to the next highest level, andthat the classes of positions assigned to the level are accurate, the pay band minimum is higher than theactual salary earned by twelve positions. The twelve positions are in the classes of both DieticianSupervisor and Public Health Nutritionist Supervisor. This cost should be able to be readily absorbed bythe employing agencies.

In addition, where the pay range minimum was greater than the lowest actual salary being paid, the payrange minimum became the minimum of the proposed pay band. A review of the positions paid belowthe pay range showed that these positions are in a training or temporary status, whereby their salaries arelower due to agency-specific reasons. The proposed pay bands hold employees harmless of thesesituations by not lowering the minimum of the new pay band.

Finally, if a drawback to this proposed pay system exists, it is the fact that it is not truly a “system;”rather, it is a collection of individual pay ranges created with a level of attention given to overallsymmetry. While certainly functional, the fact that each pay band is essentially tied to a broadband levelmeans that over time it will be more difficult to maintain the integrity of the initial symmetry. Changesmay begin to be made to the pay bands perhaps without regard to the relationship with other levels in anoccupation group, or to the “system” as a whole.

The 25 Pay Band Option

Under this option, a set of 25 pay bands were created and assigned across the 145 pay band levels. Thisoption provides greater reform in that greater economies of standardization and efficiency are realized dueto fewer pay bands and more consistency in pay band widths and intervals. Furthermore, the approachtaken was to create a set of pay bands that best represent actual salaries paid, yet that provide the leastcost to implement. To accomplish this, the following parameters were set:

1. Create a standard set of pay bands, totaling fewer than the actual number of broadband levels.

2. Establish a standardized width of 125 percent between the minimum and maximum of each payband, with the exception of 300 percent widths for the occupation groups of Manager andExecutive.


3. Ensure a consistent interval between the minimum salaries for each pay band of 9 percent, withthe exception of 25 percent for the Manager occupation and 20 percent for the Executiveoccupation. (Variations were due to selecting “best fit” pay bands that reflect actual salaries.)

4. Ensure pay bands reflect the range of actual salaries paid while being mindful of implementingthe least expensive pay bands.

5. Allow for progressive pay bands within an occupational group – no cases in which the minimumof a pay band assigned to a given level is less than the pay band minimum(s) for the precedinglevels.

A program was written to help run “what-if” scenarios to identify the least expensive set of 25 pay bands,while capturing the majority of actual salaries paid. After extensive runs, the proposed pay bands inAppendix G were created. Excluding vacant positions, just over 900 employees would be under theminimum of the proposed pay band assigned to their broadband levels. About 500 positions currentlyvacant have pay range minimums lower than the proposed pay bands as well. If the 25 pay bands wereapplied to the broadband levels today, the cost to bring actual salaries up to the new minimums would be$465,000. The cost to bring vacancies up to the new minimums would be $1,128,000.

Changes to Pay Progression

By statute, “the pay administration system must contain provisions to allow managers the flexibility tomove employees through the pay ranges and provide for salary increase additives and lump-sumbonuses.” To meet this requirement, the Department of Management Services recently revised CareerService rules to remove existing obstacles to providing a better environment for pay progression.

SUMMARY OF CURRENT CAREERSERVICE RULES

RECOMMENDED CHANGES

New or promotional appointments are toreceive a salary at the minimum of the payrange for that position. Few exceptions areallowed.

Remove restriction that limits initial salary to theminimum of the pay range.

Base rate of pay increases can be given underone of these categories: superior proficiency;added duties and responsibilities; educationand training; reassignment, transfer;competitive job offer; and internal payrelationships.

Remove pre-defined reasons. Ensure documentedjustification is maintained for pay increases, fundsare available for the increase, and that the increase isnot specifically prohibited by law.

Employees may receive only one increase percategory in any 12-month period.

Remove the restriction of receiving only one payincrease per category.

Shift differential pay additive is class-based. Remove the restriction of being class-based to beingposition-based.

The above recommendations are specific to Career Service employees only. Agency heads already havethe discretion to adjust the salaries of their Selected Exempt Service and Senior Management Serviceemployees.


CONCLUSION

Governor Bush’s Service First initiative emphasizes a set of guiding principles for enhancing the state’scivil service system. Changes are needed to modernize the current system so that managers have theopportunity to reward employees for performance. This proposed broadbanding classification andcompensation model will:

• Achieve efficiency and savings as a result of reductions in administrative workload• Simplify personnel administration• Utilize best practices in HR administration• Allow managers to utilize employees to their full potential and with more latitude to

reward high performance• And, facilitate the creation of a workforce that can readily respond to a changing

environment and the needs of the citizens that we serve

The proposed system will be built using the Federal Standard Occupational Classification (SOC) systemas a structural foundation. This will provide a consistent approach in how we define occupations andcategorize jobs. This is beneficial in many ways, including enhancing the state’s ability to plan andaddress the needs of a dynamic workforce and be more responsive to fulfilling critical agency missions.Further, the gains that will be made in employee productivity, and ultimately in agency performance, maybe achieved through broadbanding with minimal costs.


APPENDICES

Appendix A - List of Pay Plans not included in report

Appendix B - Crosswalk between existing classes and proposed broadbands

Appendix C - Class/Levels with less than ten positions

Appendix D - SOC Modifications

Appendix E - Occupation Performance Factors

Appendix F - Cost Neutral Pay Bands Comparison of Pay Data

Appendix G - 25 Pay Bands Comparison of Pay Data

Appendix H - Broadband Design with Position and Class Count

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