December 26, 1996

Re: Fiscal Year 1996-97 Incentive Award Program

Attached are the general program guidelines and eligibility criteria for the 1996-97 Incentive Award Program. Highlights of this year's Incentive Award Program are:

• The University Incentive Award Program will be funded by a benefits assessment made to all payroll fund sources. The assessment rate for this fiscal year has been set at 1.3% of applicable salaries to create a liability pool that will fund the Incentive Award Program. However, since the first assessment was not implemented until the October 1996 earnings, the rate will be 1.73% through June 30, 1997 to incorporate earnings for July through September 1996.

• Employees in career, casual and casual/restricted appointments are eligible for an Incentive Award when their department heads determine that their performance justifies receiving such an award. Employees in contract appointments and employees in the Senior Management Group of Tier 2 (formerly Executive Program) are excluded from the provisions of the assessment plan only.

• Employees in Per Diem appointments and employees in the UC/Printing Trades Alliance agreement are not eligible for Incentive Awards or covered by the provisions of the assessment plan.

• At this time, represented employees in the Technical (TX) Unit and the Police (PA) Unit are not eligible to receive 1996-97 Incentive Awards. Departments are advised to reserve funding for potential future distribution to eligible employees in these units.

• Individual and/or team awards may be granted.

• Awards may be granted at any time through June 30, 1997.

December 20, 1996

Page 2

• Deans, Provosts and/or Vice Chancellors may establish implementation and selection procedures for their organizations within the parameters of the attached guidelines.

• Award payments can be processed on-line through the on-line Payroll Time Reporting (PTR) System which now eliminates pre-approval and review by Campus Human Resources.

Questions and requests for assistance regarding the 1996-97 Incentive Award Program guidelines should be directed to the Compensation Analyst assigned to your department at extension 40880.

/S/

Ruie Arnett

Interim Assistant Vice Chancellor

Attachments

The purpose of Incentive Awards is to:

1. encourage excellence in University service related to productivity and customer service;
2. recognize and reward significant achievements and contributions related to creative and innovative projects that improve organizational effectiveness;
3. recognize and reward outstanding individual performance that enhances organizational effectiveness; and,
4. encourage and recognize outstanding team performance.

• Employees in career, casual and casual/restricted appointments are eligible for consideration for an Incentive Award .
• Employees in contract appointments are eligible for consideration for an Incentive Award if so specified in their individual employment contract, but they are not subject to the provisions of the assessment plan.
• At this time, represented employees in the Technical (TX) Unit and the Police (PA) Unit, are not eligible for consideration for an Incentive Award. Inclusion in the program at this time is subject to contract negotiation. However, departments are advised to reserve funding for potential future distribution to eligible employees.
• Employees in Per Diem appointments are not eligible for incentive awards or covered by the provisions of the assessment plan.
• Employees in the UC Printing Trades (GS) are not eligible for incentive awards or covered by the provisions of the assessment plan.

Incentive Awards may be awarded at any time through June 30, 1997. Awards may be granted as either a percentage of base pay or as a flat dollar amount as long as the total award does not exceed 10% of an employee's annual base pay rate (based on the last day of the pay period immediately preceding the effective date of the award) during fiscal year 1996-97. Base pay is the regular rate of pay, excluding overtime, stipends and differential pay such as shift differential. An employee may receive both a team and individual award provided that the combined amount is within the 10% limitation.

• Individual Incentive Awards:

1. Evidence of creativity or innovation that impacts the department or campus community.
2. Evidence of a special one-time contribution of measurable significance to the departmental mission or strategic plan.
3. The ability to achieve favorable reactions from customers and handle customer/client needs that meet departmental objectives.
4. Improved organizational performance and operational efficiency.
5. Supports strategic/functional business plans and objectives.

• Team Incentive Awards:

1. The goals and accomplishments demonstrate improved performance and operational efficiency.
2. The goals and accomplishments support strategic and/or functional business plans and objectives.
3. The goals and accomplishments address customer or client needs that meet departmental and/or campus objectives.

As announced in the Deans, Directors memorandum of October 24, 1996, the University Incentive Award Program will be funded by an employee benefits assessment made to the payroll fund sources of all eligible employees to create a campuswide pool of funds from which award payments are made. The assessment rate for fiscal year 1996-97 has been set at 1.3% of salaries. However, the first assessment began with October 1996 earnings at the rate of 1.73% and will continue at this rate until June 30, 1997 to incorporate earnings for July through September 1996.

• Employee Salaries Included in the Assessment Process:

• Employee Salaries Excluded from the Assessment Process:
• Employees in Per Diem appointments are not covered by the provisions of the assessment plan.

• Employees with contract appointments are not covered by the provisions of the assessment plan.

• Employees in the Senior Management Group of Tier 2 (formerly Executive Program) are not covered by the provisions of the assessment plan.

• Employees in UC Printing Trades (GS) are not covered by the provisions of the assessment plan.

Departments must first ensure that nominees are eligible for consideration for Incentive Awards in accordance with the eligibility requirements.

• Individual Incentive Award Nominations:

Eligible employees may be nominated for an individual Incentive Award by their immediate supervisor; other supervisors; or managers in their department; or a customer (e.g., faculty, staff students, patients or vendors who the employee provides a service or product to on a regular basis). The nomination should be approved by the eligible employee's department head, regardless of the funding source supporting the nomination.

• Team Incentive Award Nominations:

Team Incentive Award plans may be established at the discretion and approval of the Department Chair, Director, Dean, Provost or Vice Chancellor. Team Incentive Award plans should be formally written and communicated to the affected work group and are dependent on the achievement of specific predetermined criteria.

• Nomination Forms:

A model nomination form (ATTACHMENT B -- UCLA 1996-97 Incentive Award Nomination Form) is provided for your use in facilitating the Incentive Award nomination and authorization process. This form may be used for both individual and team award nominations. It is recommended that the supervisor of the nominated employee concur before nominations are forwarded to the next level for review and endorsement. Final approval of the award rests with the Dean, Provost or Vice Chancellor.

Departmental Payroll Time Reporting (PTR) preparers initiate Incentive Award payments by processing a one-time payment from the employee's salary account (sub 1, 2, 5, or 7) on the EDFT screen in the On-Line Payroll Time Reporting (PTR) System. The Personnel/Payroll System produces payment of the lump sum awards which are subject to federal, state and FICA deductions at the rate of 28%, 6% and 7.65% respectively.

• Award Payments Eligible to be Paid From the Assessment Fund:

• Award Payments Not Eligible to be Paid From the Assessment Fund:

Refer to the Payroll Time Reporting Manual , Section E4.0 for detail instructions on processing award payments.

The Personnel/Payroll System has been enhanced to now automatically record award data on the awards screen (EAWD) in EDB on employees receiving award payments generated by the use of DOS code "IAP"only. Departmental EDB preparers will be required to manually record award data for contract employees and employees in the Senior Management Group who receive awards by DOS codes "MIA" and "EIA" respectively. Instructions for entering data are found in the EDB Manual Section D.11.0.

Organizations that want to develop local award programs may do so by submitting a request to Campus Human Resources. The request will be reviewed to determine proper notification to employees and/or employee organizations and to ensure compliance with provisions in any applicable collective bargaining agreements. The request should include the following:

• Purpose of the award
• Type of award (for example, individual and/or group award, one-time payment and/or sustained contribution to University or work unit, budget savings idea, innovative solution to work problem, etc.)
• Source of award funding
• Administrative procedures used for determining awards should include:
• application/nomination procedures
• review and approval process
• timing of award
• employee eligibility criteria

Questions regarding the Incentive Award guidelines should be directed to the Compensation Analyst assigned to the department. Questions regarding the award payment process or entering data in EDB should be directed to the Benefits and Personnel Specialist assigned to the department.