1. Associate Changes Policy: Manager Training

2. Agenda Introduction What is governed by the policy?
Special Pay Increases
Delegation of Authority
Approvals
Required Documentation
Absences
Process
Where to get more Info
Q&A

3. Introduction We are introducing this policy because:
We are now at the size where we need documented, fair and consistent policies for all employees in our company
We want to provide clear guidance to our managers for how to handle certain employment-related changes for associates
We want to empower our managers and allow the VP (ELT-1) to approve certain compensation changes…
While still ensuring the ELT has final approval on the larger, budget-impacting proposed changes
We want to ensure that all changes in duties and responsibilities are clearly documented for employees so they know what is expected of them…
We also need clearly documented duties and responsibilities so that managers can monitor and address the employee’s performance
Introduction

4. What is governed by the policy?
The following employment changes for active associates are governed by this policy:
Promotions
Transfer
Job Title Change
Reporting Manager Change
Compensation Change
Cost Center Change
Not governed by this policy are:
Annual merit increases
Internal salary inequity adjustments (part of merit process)
Company-wide bonus plan changes
Company-wide reorganizations
What is governed by the policy?

5. Salary increases which are not due to new hires, promotions, mandated raises or the merit cycle.
Proposed increases must meet distinctive, case-by-case circumstances defined in the policy.
These become effective on the date of approval by the relevant owner.
Special Pay Increase Types:
Temporarily increased responsibilities
Market-based special pay increases
Counter-offer
Retention
Recognition
Special Pay Increases

6. Special Pay Increases Temporarily Increased Responsibilities:
The duties which justify a temporary increase for duties, must also be new assignments requiring greater skills, new knowledge, a greater level of authority and responsibility, or other changes in duties which are considered higher level than previous duties.
Additional compensation for temporarily increased responsibilities can be requested as a one-time lump sum payment, rather than an increase in base pay.
A request for temporary pay increase involves preparation of a description of the added duties, but not a new formal job description.
All special pay increases for temporary duties are provided with assigned start and end dates, which may be extended if necessary. If such duties are indefinitely assigned and there is no intention by management to make changes which would remove the duties, a formal promotion should be considered and an amended job description should be provided for approval.
If an associate assumes all (or substantially all) of the job of a higher-level position, typically due to a temporary vacancy in that position, the associate may receive a short-term or acting appointment to that position, going on leave from the current position.
If the associate retains many of the current duties, and gets only a portion of the duties of the vacant position, then the associate remains on the same position and may not justify a one-time bonus if the temporary duties are similar in overall level of skill and responsibility to the permanent duties.
Special Pay Increases

7. Special Pay Increases Market-based special pay increases:
Since changing market conditions outside Aasonn may not be reflected in the pay of current associates, special pay increases may be given on evidence that an associate or group of associates is paid significantly below an external market rate.
The request for a market-based special pay increase must include current market data.
Managers should partner with HR to review and collect relevant market data.
Special Pay Increases

8. Special Pay Increases Counter Offer:
This kind of special pay increase may be requested by a manager when the associate has a formal (usually written) job offer from outside Aasonn for a job that is substantially the same as the job that the associate holds at Aasonn.
A counter-offer is not appropriate when another department at Aasonn offers an associate a job at a higher salary.
The objective of a counter-offer is to retain a high-performing, valuable associate, and the special skills of the associate are a significant part of the justification for this type of special pay increase.
The counter-offer does not have to match or exceed the external offer and internal and external market data should be considered when determining the appropriate salary to offer.
Managers should partner with HR to review and collect relevant market data.
Special Pay Increases

9. Special Pay Increases Retention:
A retention special pay increase is very similar to a counter-offer, but is given when there is a likelihood that an associate will receive an outside job offer.
Like counter-offers, retention special pay increases are not given in response to other job offers at Aasonn.
The objective of a retention special pay increase is to keep a high-performing, valuable associate, and the special skills of the associate are a significant part of the justification for this type of special pay increase.
The amount of this type of special pay increase still has a market component, and the requested salary should be in line with a likely salary which the associate could receive for employment outside of Aasonn.
Special Pay Increases

10. Special Pay Increases Recognition:
Pay for performance is a key factor in Aasonn’s compensation strategies to pay a competitive wage and to enhance pay for successful outcomes, for the acquisition and application of relevant competencies and/or for contributions valued by the company.
Eligible recipients are teams, groups, or individuals. Salary increases for performance are given to recognize documented, superior performance. Recognizing an associate’s contribution, productivity and outcomes are the main basis for our compensation plan.
Pay for performance resulting in an increase to base pay is normally handled through the annual merit program.
Payment in recognition of the accomplishment of shorter term projects or goals is paid as a one-time lump sum payment.
Requests for lump sum payments should be accompanied by evidence detailing the targets set for the individual and the results achieved against these.
It is expected that these are either additional stretch assignment tasks, or the associate has demonstrated significant overachievement against their core goals.
Special Pay Increases

11. Delegation of Authority
Delegated authority has been introduced to reduce the levels of approval needed in certain circumstances.
There are, however, set limits on the increase/bonus amount which may only be exceeded on the approval of the CFO and ELT Manager.
Please note, where limits are set for the Vice President level (e.g. at 6%), this is the highest compensation change that authorized level is allowed to approve.
The proposed compensation change can exceed this amount, and if so, further approvals will be required from the executive team.
Delegation of Authority

12. Delegation of Authority
Situation
Action
Authorized
Other
New Hires
Ability to hire up to midpoint of pay grade
Vice President (ELT-1)
Executive approval required for hires below minimum of pay grade or above midpoint of pay grade. CFO approval required for hires above maximum of pay grade.
Promotions
Ability to pay up to midpoint of pay grade or 6% increase associate’s base rate, whichever is greater
Executive approval required for promotions below minimum of pay grade or above midpoint of pay grade, or 6% above base salary. CFO approval required for promotions above midpoint of pay grade or 6% above base salary.
Temporary increase of responsibilities
Lump sum awards only. May not exceed 6% of base salary.
Executive and CFO approval required for bonuses above 6% of associate’s base rate, or increases exceeding the maximum of the pay grade.
Retention
Up to 6% above associate’s current base salary
Executive and CFO approval required for increases above 6% of associate’s base rate.
Market salary adjustment
Up to 6% above associate’s current base salary (current market data should be considered)
Executive and CFO approval required for increases above 6% of associate’s base rate, or increases exceeding the maximum of the pay grade.
Delegation of Authority

13. Delegation of Authority
Situation
Action
Authorized
Other
Counter offer
Up to 6% above associate’s current base salary
Vice President (ELT-1)
Executive and CFO approval required for increases above 6% of associate’s base rate, or increases exceeding the maximum of the pay grade.
Recognition
Lump sum awards only. May not exceed 6% of base salary.
Executive and CFO approval required for bonuses above 6% of associate’s base rate, or increases exceeding the maximum of the pay grade.
Delegation of Authority

14. If beyond delegation of authority remit
The following approvals are required for associate employment-related changes:
Change Requested
Manager
Vice President
Executive
CFO
Cost center x
Reporting manager
Promotion
If beyond delegation of authority remit
Transfer
Compensation
Job Title*
Required Approvals
* If job title is not part of the existing job catalog, a new job description must be submitted to and approved by HR.

15. Required Documentation
The following documentation must be submitted in order for an employment change event to be approved.
Promotion:
Interview notes for the successful candidate with scoring summary for all applicants, or
Documentation showing that the associate has demonstrated the required keys, skills, attributes and required training for progression into the next role (if the competitive process was not followed).
Updated job description for the new role.
Transfer:
Interview notes for the successful candidate with scoring summary for all applicants
Job Title Change:
New/Amended Job Description
Line Manager Change:
None
Required Documentation

16. Required Documentation
The following documentation must be submitted in order for an employment change event to be approved.
Compensation Change:
Updated job description (if change results from a promotion)
Description of added duties (if change results from temporarily increased responsibilities)
Current market data (if market-based or retention special pay increase is requested)
Outside job offer compensation details (if counter-offer change is requested)
Lump sum bonus metrics and results achieved (if pay for performance bonus is requested)
Cost Center Change:
None
Required Documentation

17. Statutory or policy-based leaves will follow the policy as outlined, will consistently be applied to all leaves within the company, and will be maintained in compliance with local, state and federal laws.
Employees going on or returning from leave are eligible for incentives and bonuses at their manager’s discretion.
Absences

18. Process

19. Please note, this is being built into our SuccessFactors system and should be ready by the end of the week.
Process

20. The policy, process and procedures will also be available soon on the HR Service Center site, under Knowledge Base.
Questions/guidance:
More Info?

21. Questions?

22. Thank you for your time!