Are paymasters just feeding unfairness?

13th May 2011 at 01:00

Is it time we got rid of colleges' renumeration committees? I pose this question not simply as a comment on the salaries of principals and senior staff, which those committees decide. Principals and senior staff should, in my view, be paid appropriately, even if that means a significant gap between their salaries and those of other staff. But, in the context of the Hutton Review of Fair Pay in the Public Sector and the wide-scale austerity measures that colleges have to implement, I fear that the renumeration committees may cause significant harm to sound industrial relations if they award principals and senior staff a greater percentage increase in salary than the rest of the staff.

Renumeration committees were established in 1993 with the idea that they would offer rewards that were "sufficient" to attract, retain and motivate principals and senior staff of high quality. Over recent years, these reward packages have become increasingly complex, and they differ from one college to another. There is a growing concern in the sector that, as a result of the awards being made by the committees, the gap between the pay of senior staff and their colleagues is getting wider and wider.

There appear to be several reasons why this has happened. First, remuneration committees are often staffed predominantly by executives from the private sector, who therefore tend to compare the salaries to those of their colleagues, despite the fact that the roles, responsibilities, accountabilities and risks are different.

Second, remuneration committee members are rarely selected on the basis that they have significant expertise and appropriate training to develop reward packages for senior staff in colleges.

Third, where remuneration consultants are engaged, earning large fees in the process, they usually err on the side of generosity when making recommendations.

Fourth, where either the remuneration committee or its appointed consultants use judiciously selective "comparative data", this is likely to have a racheting effect on senior staff salaries in the sector.

The Hutton review suggests that an element of their basic pay "at risk" is to be earned each year through meeting agreed objectives. Some colleges have introduced elements of "performance-related pay" for senior staff but there are several logical flaws to this: why would only senior staff respond to financial incentives such as these and not lecturers and support staff? Or would senior staff deliberately sabotage the efforts of lecturers and support staff in their efforts to deliver high-quality education, if they were not offered these incentives? There is no research evidence to show that where those incentives were introduced in colleges, they have contributed to a significant improvement in performance.

In summary, principals and senior staff are generally paid well to manage the delivery of high-quality education and training in their respective colleges, and where there are difficulties these are shared by all staff. When a salary award is made it should be a single percentage award to all staff, since senior staff will in reality and in absolute terms receive more than other staff. If performance-related payments are introduced, then this should apply to all the staff, similar to the John Lewis Partnership model. This collegiate approach is more likely to help performance and promote good industrial relations. In my experience, it took me almost two years to convince the remuneration committee that all senior staff, including me as principal, should be given the same annual percentage increase as all the other staff. The real reward for me was good industrial relations, which may have helped our staff to achieve their best.

Ahmed Choonara is a former college principal.

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