F. Compensation

(Note: OLPM sections on this page may be cited following the format of, for example, "BOT V.F.1.1". These policies may be amended at any time, do not constitute an employment contract, and are provided here only for ease of reference and without any warranty of accuracy. See OLPM Main Menu for details.)


F.   Compensation1

1.   Authority

1.1   State law (RSA 187-A:16 I, II, III, V, VI and XVI) delegates to the Board of Trustees authority to hire, employ and compensate such personnel as are needed to provide a well-coordinated system of public higher education.

1.2   Compensation Policy. The Board of Trustees retains the authority over all aspects of compensation for USNH's Chief Executive Officers.

1.3   The Board of Trustees retains the authority to approve compensation agreements contained in collective bargaining agreements.

2.   Executive Total Compensation

The Board of Trustees delegates to the Executive Committee of the Board of Trustees the review and approval of Total Compensation for the Chief Executive Officers, the Chief Academic Officers (CAOs), and the highest ranking financial or administrative officer at each of the institutions, using the following options and procedures. It is the goal of the following statements, that the Board of Trustees establish an overall Total Compensation philosophy and practice that will foster its ability to attract and retain highly qualified candidates for leadership positions within the University System. The University System aspires to establish accountability and recognition systems that will foster the accomplishment of those strategic goals which support the mission of its institutions. This includes both the vigorous processes for establishing and reviewing goals as well as policies and practices that recognize the importance of the contributions of the organization’s leadership to its overall success.

2.1   The Board Officers, with approval of the Executive Committee, shall appoint annually one Board-designated subcommittee of three to five Trustees, for the purposes set forth in this policy, giving due consideration to the dual purposes of renewal and continuity. The subcommittee shall be known as the Compensation Committee and shall report to the Executive Committee periodically.

2.2   The policy of the University System is to provide direct total compensation programs which reflect the relative size, complexity, and type of education curriculum of the University System in the segment of higher education institutions of which it is a part and which accomplish the University System's mission and tax exempt purpose without causing any part of the University System's net earnings to inure to the private benefit of an individual or group of individuals.

2.3   Consistent with the USNH Board of Trustees’ policies on compensation of executives (BOT V.F.1 through 5) and the statement of Total Rewards Objectives, adopted on February 17, 2011, compensation packages for executives shall support the mission, vision, and values of USNH and its component institutions and be calculated to:

  • Attract and retain talent
  • Competitively position USNH and its component institutions
  • Reward performance (see also BOT V.C.5)
  • Maintain fiscal responsibility

​​​​​2.4   The executive positions covered by this policy are the Chief Executive Officers (CEOs), the Chief Academic Officers (CAOs), and the highest ranking financial or administrative officer at each of the institutions.  For the CEOs the Compensation Committee shall make recommendations to the Executive Committee, which shall remain responsible for the review and approval of all aspects of CEO compensation.  For other Executive Officer positions covered by this policy, the Compensation Committee shall review and approve the CEO’s compensation plans and recommendations prior to implementation.  If the committee objects to any aspect of a compensation plan and/or recommendation, the CEO shall adjust the plan and/or recommendation accordingly.

2.5   Competitive Compensation. The Compensation Committee shall use the following process when developing its recommendations.  CEOs also generally shall use this process when developing compensation plans for their Executive Officers.

  • Engage independent and qualified consultants to advise and assist with the process
  • Establish appropriate peer groups of comparator institutions
  • Establish appropriate total cash compensation target (base salary plus performance award target) within the peer group; this peer group target for any particular executive might vary from the 45th percentile of the peer group’s total compensation to the 60th percentile
  • For each Executive Officer, using the 50th percentile for target total cash compensation (base salary plus performance award target) as the starting point, determine and document reasons for varying either down to the 45th or up to the 60th percentile
  • Incorporate the total cash compensation peer group target percentile into the executive’s employment agreement, and use this peer group target as a guide for setting the executive’s starting base salary
  • Use the total cash compensation peer group target percentile as basis for annual adjustments to the Executive Officer’s base salary
  • Report the recommended initial base salary and the performance award target, and annual base salary adjustments, with performance increases based on the report of the Executive Performance Review Subcommittee, to the Executive Committee for final decision.

2.6   In determining the appropriate variance from the 50th percentile and developing compensation recommendations for each CEO, the Compensation Committee shall consider all appropriate factors including but not limited to:

  • Performance (from the report of the Executive Performance Review Subcommittee)
  • Relevant education, training, and experience
  • Available resources
  • Internal equity
  • External equity
  • Best interests of the institution and University System.

2.7   Eligibility. In order to be eligible for any general or merit increase, a CEO must have at least six months of service in the position as of the effective date of the increase. A CEO, who has more than six months of service, but less than 12 months, will be eligible for pro-rated general or merit increases.

2.8   One-Time Bonus Recognition. After review of recommendations, the Executive Committee may approve one-time bonus payments awarded to recognize significant contribution and/or extraordinary effort.

2.9   Deferred Compensation for CEOs. The Executive Committee may award one-time or multiple year payments to a deferred compensation plan for a CEO, consistent with market practices.

2.9.1   The Executive Committee may approve a one year, non-reoccurring payment, or multi-year payments to USNH's IRC section 401(a) plan or 457(f) for the purpose of retention with a five-year vesting plan. The amount of the deferred compensation may vary by individual and by year but shall not exceed 15% of the CEO's annual salary rate, and shall be subject to federal tax and legal obligations and limitations.

2.10  Third Party Compensation or Employment of USNH CEOs. No USNH CEO may accept or receive compensation or employment from a source outside of USNH without the prior approval of the Executive Committee.

3.   Appointment Conditions for CEOs and Other Executive Officers (CAOs and the highest ranking financial or administrative officers)

3.1   Approval of Appointment for CEOs. Employment Agreements shall be used for CEO appointments.  The Executive Committee shall review and approve employment conditions, including separation or retirement, in the Employment Agreements.  Each agreement shall be reviewed and authorized for clarity and content by the USNH General Counsel and approved by the Board Chair.

3.2   Approval of Appointment for Other Executive Officers. The Executive Committee shall review and approve the Chief Executive Officer's recommendations of all terms and conditions for appointments to Chief Academic Officers and the highest ranking financial or administrative officer. Confirmation of employment shall be in a written "letter of appointment." Written confirmation of employment is considered notice of appointment rather than a contract. These letters will contain the annual salary rate and effective date of appointment as well as confirmation that the appointment is subject to Trustee, USNH and institutional policy. These letters shall be reviewed and authorized for clarity and content by the USNH General Counsel and approved by the Board Chair.

3.2.1   Conditions of Appointment. Letters of appointment shall include any additional information about conditions of employment as approved by the Executive Committee. Only those options described below may be recommended as part of an initial appointment and require individualized approval at the time of appointment by the Executive Committee.

3.2.1.1   Options to be included in an initial appointment include the following choices. It is anticipated that the options will be tailored to the compensation and market demands at the time of hire.

3.2.1.1.1   One time Transition Payment. This is an option to provide a lump sum, non-recurring supplemental payment intended to aid transition to a new position, including, but not limited to the costs of moving and/or relocation. It is subject to applicable taxation.

3.2.1.1.2   "Home office" options. This is an option to provide phone lines, computers, or other appropriate technology or telecommunication equipment or services.

3.2.1.1.3   Tenure or Concurrent Faculty Appointment. An appointment with tenure is an option available only to Chief Academic Officers. This option does not assume that the salary associated with the CAO will continue into the Faculty position. If a Chief Academic Officer with tenure decides to return to teaching, the salary for the instructional position shall be consistent with that of the rank and service for faculty in the specific discipline. If tenure is not appropriate, the CAO may be offered a one year transition to a teaching or research assignment.

3.2.1.1.4   Professional Development. This is an option to provide funds for attendance at a specific professional development program of a significant nature in terms of time and cost.

3.2.1.1.5   Salary Incentives. Executive Officers will be eligible for annual salary increases. These are expected to be decided annually and at the discretion of the Executive Committee. In addition, one-time bonus or performance incentive award payments may be included in the annual compensation awards tied to successful completion of identified annual strategic goals.

4.   Separation and Retirement of Executive Officers (CAOs and the highest ranking financial or administrative officer)

The Executive Committee of the Board of Trustees is responsible for the approval of the separation or retirement of an Executive Officer.

4.1   Voluntary Retirement or Separation. It is anticipated that Executive Officers shall give at least 90 days' notice of resignation or retirement, or a notice period mutually agreed upon by the CEO and the Executive Officer. Unused vacation days, up to the policy maximum of 30 days will be paid to terminating Executive Officers.

4.1.1   Voluntary separation for a Chief Academic Officer shall include a paid transition leave of one month per year of service up to a maximum of 6 months if s/he is returning to teaching.

4.2   Involuntary Separation. Reasons for involuntary termination of Executive Officers may include, but are not limited to issues around performance, reorganization, cost containment, supervisor's loss of confidence and changes in strategic direction.

4.2.1   If an Executive Officer is recommended for termination he/she shall be given six months' notice of termination unless the separation is due to guilt in a crime, or other institutionally determined destructive or detrimental action such as, but not limited to, violations of conflict of interest or fraud.

4.2.2   The Executive Officer has grievance rights as defined in USY V.D.12.

5.   Delegation of Authority to the Administrative Board

5.1   The Administrative Board shall establish a job evaluation system and compensation policies. These shall comply with state and federal legislation, promote the goals of internal equity, reward for meritorious performance, effective recruitment, and retention of faculty and staff, and further the purposes set forth in the USNH Total Rewards Objectives, adopted by the Board of Trustees on February 17, 2011.

5.2   Pay Ranges. The Administrative Board shall establish a set of pay ranges and classification assignments for PATs, Academic Administrators, Extension Educators, and Operating Staff. Pay levels and ranges if applicable for faculty salaries shall be set by individual institutional authority, unless covered by collective bargaining obligations.

5.3   Additional Pay Policies. The Administrative Board shall establish compensation policies relating to hours of work, work in excess of a regularly classified and compensated work day, holiday pay, shift differentials, and policy for payment of hourly and other adjunct employment.

5.4   Total Compensation Policy for Executive Officers. The Administrative Board shall adopt a comprehensive Total Compensation policy for Executive Officers for the same purposes as set forth in subsection 5.1, above. In addition, the policy shall authorize the CEOs to set the Total Compensation for their respective Executive Officers, following a process that includes, but is not necessarily limited to, the following steps:

5.4.1   Obtain from the USNH HR office and consider:

  • current and relevant external market data on each of the positions;
  • compensation data on all USNH Executive Officers; and
  • current EEO/AA plan and related data.

5.4.2   Review the Board policy on Executive Compensation for CEOs (BOT V.F.2), in particular the principles, objectives, and spirit, but not the approval process or delegations of authority. CEOs should use the process outlined in F.2 when making salary total cash comp for executives.

5.4.3   Review the Total Rewards Objectives approved by the Board on February 17, 2011.

5.4.4   For each proposed increase each CEO will carefully consider:

  • meritorious performance;
  • external equity;
  • internal equity, including the minimization of the potential for a "ratchet effect" among the institutions;
  • EEO/AA plans, goals, objectives, and compliance;
  • the principles, objectives, and spirit embodied in the Board policy on Executive Compensation for CEOs (BOT V.F.2); and
  • the USNH Total Rewards Objectives, adopted by the Board on February 17, 2011.

5.4.5   Each CEO will obtain approval from the Executive Committee for hiring salaries and Total Compensation of Chief Academic Officers and the highest ranking financial or administrative officer.  To support the goals of creating and preserving internal equity and minimizing the potential for creating a "ratchet effect" among the institutions, the CEO will discuss plans for other Executive Officers’ Total Compensation increases and hirings with the other USNH CEOs.

5.4.6   For each proposed Total Compensation increase or hiring and subsequential changes, the CEO must document the careful consideration of the relevant criteria as applied to the facts of each case, and be prepared to report her/his decision and essential reasons to the Executive Committee.

1See USNH Total Rewards Objectives, approved by Board of Trustees on Feb. 17, 2011

This page last updated Thursday, February 2, 2017. For information on the adoption and effective dates of policies please see explanation on the OLPM Main Menu.