* Hot off the presses…

TO: State Agency Directors
FROM: Dan Hynes, Deputy Governor
DATE: November 22, 2019
RE: Merit Compensation

Our employees are integral to ensuring that state government meets the needs of those we serve. Day in and day out, state workers provide vital services to people, businesses, and communities across Illinois. We have a responsibility to ensure that we attract the best talent to these roles and fairly compensate the public servants who make our state run.

To that end, shortly after taking office, Governor Pritzker asked me to evaluate the pay structure for merit compensation employees. These employees have not received a cost of living adjustment in more than a decade (since July 1, 2009). Over that same period, inflation has increased the cost of living by 19.5 percent. This disparity has operationally hamstrung state agencies, with some managers unfairly penalized in their compensation and in some cases, paid less than those they supervise. This undermines the state’s ability to recruit and retain managers and devalues the work of those overseeing critical work within state government.

In order to begin to address these issues, we are moving forward with a two-year merit compensation plan. The plan includes the following:

Fiscal Year 2020

• Rebuild salaries for bargaining unit employees who left their bargaining unit position to take a merit compensation position. Employees with a current salary less than what it would have been with the step increases will receive an increase to match the value of the post-step adjustment level. This level will be determined by what the level would have been when the employee left to take the merit compensation position. Adjusted salaries will be effective retroactive to September 1, 2019.

• Issue a one-time stipend for all eligible merit compensation employees. To be eligible, a merit compensation employee must have been in active status as of December 31, 2018, and not had a special salary adjustment in the last 12 months (since November 1, 2018). The stipend will be pro-rated based on years of service as of November 1, 2019 ($2,500 for four or more years of service; $1875 for more than 3 years of service; $1,250 for more than 2 years of service; $625 for more than 1 year of service).

• Provide a cost of living adjustment of 1.5 percent effective January 1, 2020 for eligible merit compensation employees (in line with the 1.5 percent cost of living adjustment that AFSCME employees will receive). To be eligible, merit compensation employees must have been in active status as of December 31, 2018.

Fiscal Year 2021

• Provide a cost of living adjustment of 2.1 percent effective July 1, 2020 for all merit compensation employees (in line with the 2.1 percent cost of living adjustment that AFSCME employees will receive).

• Begin to align salary ranges for merit compensation position classifications with salary ranges for identical bargaining unit position classifications. Employees in these merit compensation positions who are earning less than the minimum salary of the corresponding bargaining salary range will receive salary increases to a new minimum salary over the next three years. Salaries for merit compensation Public Service Administrators who make less than the bargaining unit minimum will begin to be addressed over five years.

Looking ahead, I have also directed the Department of Central Management Services (CMS) to put together a proposal for a permanent merit compensation pay structure for FY22 and beyond.

In the coming days, CMS and the Governor’s Office of Management and Budget will send further guidance to state agencies to ensure proper implementation of this plan.

We sincerely value the hard work of our merit compensation employees, and we hope that this plan will provide long overdue relief and stability to state workers.

Back in the day, when the state had money to spend because it wasn’t making its full pension payments, merit comp workers would receive the same raises as union employees. The lack of raises is a big reason why so many employees have clamored to join a union.