Title
The University of North Carolina at Chapel Hill Policy on SHRA Sign-On and Retention Bonuses1
Introduction
Purpose
The North Carolina Office of State Human Resources (OSHR) allows the University of North Carolina at Chapel Hill ("University") to develop programs to provide bonuses to recruit or retain employees in hard-to-fill occupations. Bonuses awarded under this policy are to aid the University in recruitment and retention efforts necessary to carry out mission-critical services and initiatives. The purpose of this Policy is to outline the eligibility requirements for such bonuses.
Scope of Applicability
This policy applies to SHRA and SHRA Law Enforcement Officer permanent positions and employees (including probationary and time-limited). Positions must be at least 0.5 FTE to be eligible.
Policy
Policy Statement
Subject to the eligibility requirements and provisions outlined in this Policy, the University allows for Sign-on and Retention bonuses for SHRA positions carrying out mission-critical services and initiatives when necessary to recruit or retain employees in hard-to-fill positions.
Eligibility Requirements
Only candidates for or employees in probationary, permanent, or time-limited positions working at least 20 hours per week may be eligible for Sign-on or Retention bonuses. Bonuses for eligible employees working in part-time positions over 20 hours per week will be prorated based on hours worked.
Any groups of more than 50 employees receiving bonuses require pre-approval by the Office of State Budget and Management.
Sign-on and Retention bonuses must not be tied to meeting specific goals, special levels of productivity, quality and accuracy or work, efficiencies, or attendance.
1. Sign-On Bonuses
A Sign-on bonus may be offered either for a specific job classification or an individual position. A Sign-on bonus must be part of a program established to attract qualified candidates in critical positions that have labor market shortages, and it must be common practice to offer a Sign-on bonus to a candidate for a position to be competitive in the market.
To be eligible for a Sign-on bonus, an individual must not have worked in a probationary, permanent, or time-limited appointment in the last 12 months as an employee in North Carolina state government, including but not limited to the judicial system, state executive branch agencies, and the university system.
2. Retention Bonuses
Retention bonuses may be offered as a retention incentive in the following situations:
- To retain a group of employees in a critical classification, or in specific critical positions within a classification, with labor market shortages impacting the business needs of the University and impairing the delivery of essential services. To provide this retention bonus, the University may, but is not required to, be actively offering a parallel sign-on bonuses to employees in the same job classification within the University, or a specific division or unit;
- To retain an employee when the University has offered a Sign-on bonus as a recruitment incentive to an individual in a similar, critical position that has labor market shortages that affect the business needs of the University and impair the delivery of essential services;
- To retain a team of employees assigned to a Special Initiative of the University where their combined special skills and understanding of the initiative are critical to its successful completion; or
- To retain an employee critical to the University’s mission.
To be eligible for a Retention bonus, an individual employee:
- must not have received in the last 24 months any Retention or Sign-on bonuses that total more than $2,500 from any employment with the state of North Carolina for the job classification in which they are working.2 This limit counts all bonuses awarded over a 24-month period before the bonus award date, and will count the entire bonus award regardless of whether all installments have been paid;
- must have been in the position or within the same school/division and in the same occupational group for at least six (6) months;
- must have an overall performance evaluation rating of at least “Meets Expectations;” and
- must not have an active disciplinary action.
Bonus Amount
The amount of a Sign-on or Retention bonus must be determined based on labor market data and pay factors, including funding availability. The University has authority to approve bonuses of up to 10% of the market rate for the job classification. Bonus amounts over 10% of the market rate for the job classification require external approval.
Required Agreement and Recoupment
Before an employee may receive a Sign-on or Retention bonus, the employee must sign an agreement under which the employee agrees to repay the bonus, in whole or part, if the employee transfers to another state agency or employment with the University terminates, either voluntarily or involuntarily, before the completion of a period of consecutive service of 12 months. This 12-month period begins on the employee's start date for Sign-on bonuses and on the date of initial payment for Retention bonuses.
Repayment Formula:
The repayment will be based on the following formula:
- Amount of initial Sign-on/Retention bonus received/12 months = prorated monthly amount.
- Prorated monthly amount x (12 months - months worked) = repayment due.
If allowed by law, the required repayment amount will be deducted from the final paycheck. Any amount that is not allowed by law or that exceeds the maximum allowable deduction must be paid in full to the University within 60 days from the last date of employment.
The agreement must also state that if the employee does not terminate employment with the University but moves to another school/division or to another occupational group before completion of 12 months of service, the employee forfeits any remaining unpaid installment of their bonus.
The "period of consecutive service" follows eligibility rules for state service credit and leave accruals. Periods of leave without pay do not count toward the required 12 months of service.
Exemptions from Repayment
An employee does not need to repay any amount of a bonus if the employee's transfer or termination of employment was due to:
- Death or severe illness requiring hospitalization of the employee or the employee's parent, spouse, sibling, or child;
- Employee was unable to perform all of the position's essential duties because of a medical condition; or
- A reduction in force.
Disciplinary Action
Employees may not be disciplined for failing to stay with the University or in their position for the full period of consecutive service. If an employee received a Sign-on or Retention bonus but did not stay with the University for the full period of consecutive service, the University's only remedy is to recover those funds from the employee and may not seek to discipline the employee. Should an employee transfer to a different school/division or transfer to a different occupational group before completion of the period of consecutive service, they will become ineligible for any unpaid portion of the bonus, but not subject to disciplinary action.
Not Mandatory
Sign-on and Retention bonuses are not mandatory, and it is not a condition of employment for an individual to accept a Sign-on or Retention bonus. If the University offers a Sign-on or Retention bonus to an applicant or employee, the applicant or employee may decline the bonus. Similarly, applicants or employees may decline to sign the repayment agreement, but doing so means the individual is declining the bonus because signing the repayment agreement is a prerequisite for receiving the bonus.
Bonus Payout Requirements
Bonuses over $2,500 must be paid in two installments.
- The second installments are paid 12 months following the first installment (for Retention bonuses) or 12 months following the start date (for Sign-on bonuses). Periods of leave without pay do not count toward those 12 months.
- If there are two installments, no more than two-thirds of the total bonus may be paid in the first installment.
Notwithstanding the above, an employee is not eligible for the final Sign-on or Retention bonus installment if:
- the employee’s overall performance rating at any time is not at a minimum of “Meets Expectations” or the employee has a documented active disciplinary action for misconduct or performance;
- the employee transfers to another school/division and/or another occupational group at the University before completion of 12 months of service;
- the employee subsequently transfers to another agency before the completion of the 12 months of service; or
- the employee’s employment terminates before 12 months of service.
Related Forms and Documents
Materials related to this policy can be found on the Manager Toolkit page of the Office of Human Resources webpage. Such materials include:
- Employee Bonus Repayment Agreement;
- SHRA Bonus Request Form; and
- Additional Guidance for the Policy on SHRA Sign-on and Retention Bonuses.
Definitions
Retention bonus: a discretionary bonus that may be granted by an agency when an employee would be likely to leave the agency in the absence of a retention incentive.
Sign-on bonus: a discretionary bonus that serves as a recruitment incentive. This initiative aids in the employment of individuals for critical positions that have labor market shortages that affect the business needs of the University and impair the delivery of essential services.
Special Initiative: a defined project with specific goals, an expected beginning and end, and dedicated staff who spend a substantial amount of their time on that project.
Related Requirements
University Policies, Standards, and Procedures
External Regulations and Consequences
Footnotes
1. This is a pilot policy. It is intended to be an initial effort to develop a policy on a new topic, with the expectation that the policy will return to the State Human Resources Commission in the future for revisions when lessons are learned. The Office of State Human Resources anticipates that this policy would return to the Commission for further analysis no later than the second quarter of 2024.
2. In very limited circumstances, this 24-month period can be waived, but only with approval from the North Carolina Office of State Human Resources.
Contact Information
Policy Contacts
| Subject |
Contact |
Telephone |
E-Mail |
| Retention bonuses |
Adam Beck,
Senior Director of Human Resources, Classification & Compensation |
919-843-8258 |
adam_beck@unc.edu |
| Sign-on bonuses |
Noreen Montgomery,
Senior Director, Employment & Staffing |
919-843-9883 |
noreen_montgomery@unc.edu |