SUBJECT:

Proposed University Staff Salary Plan for 1994-95

As announced earlier, effective July 1, 1994, the University has
restored fully the base salaries of employees who were subject to the
temporary salary reduction during 1993-94. The salary restoration was
reflected in August 1 paychecks for those paid monthly and July 27 for
those paid biweekly.

As you probably are aware, the Governor signed the 1994-95 California
State budget on July 8, providing an overall increase in State general
funds for the University for the coming year. However, companion
legislation to the State budget also has been approved which might
"trigger" a mid-year cut in the State budget--and UC's budget
accordingly--if the State Controller determines later this year that
State revenues are not sufficient to meet expenditures established in
the budget. The Controller is not expected to make his reassessment
of revenues and expenditures until November 15 at the earliest, and it
will remain uncertain until then whether a mid-year cut will be
necessary. If it is determined that there is a revenue shortfall, the
Governor and Legislature could conceivably develop a plan to increase
revenues, cut spending or both, which could eliminate altogether the
need for a "trigger" or reduce its effects on the UC budget.

To address these uncertainties, the University has developed the
following proposed 1994-95 staff salary plan. The proposed plan,
which will require Regental approval when more information is
available from the State, is contingent on actual budget developments
over the next few months. The proposal is also subject to notice,
consultation, and/or meeting and conferring as appropriate under the
Higher Education Employer-Employee Relations Act (HEERA).

"No Trigger" Plan

If mid-year budget cuts are not required, staff salary increases will
be provided based on the State budget enacted on July 8. For
employees in the merit-based A&PS and MAP Programs, the fund pool
available for merit increases--a combination of range adjustment and
merit funds--is proposed to be 3.5% effective October 1, 1994. In
addition, it is proposed that .8% be set aside on a permanent basis to
augment funding for non-base building award programs for distribution
at the campus level.

The General Increase (range adjustment) available for eligible
classified staff employees would be 2.2% effective October 1, 1994,
plus an additional .8% for non-base building awards. In addition,
those classified staff eligible for merit increases would receive
half-year increases averaging one step (approximately 5%) on the
six-month delayed basis that has been in effect for the last few
years. Thus, salaries of those eligible for merit increases on July 1
would be increased effective January 1, 1995, and salaries of those
eligible for January increases would be increased effective July 1,
1995. Six-month, casual, and casual restricted increases likewise
would be delayed six months from the date they normally would be
awarded.

The most senior University officers, i.e., the President, Chancellors,
Vice Presidents, and Officers of The Regents, would not be eligible
for any salary increases in 1994-95. For other eligible Executive
Program members, the fund pool available for merit increases would be
1% effective October 1, with an additional .25% set aside for non-base
building awards.

October general range increases for classified staff, and merit
increases for the A&PS, MAP, and Executive programs would not be
processed until the University receives information regarding the
State Controller's assessment of the State's financial condition in
November. If this salary plan is adopted, the increases would be
applied retroactively and paid starting in January, 1995.

"Trigger Plan"

If a mid-year budget cut becomes necessary, it is expected that, at
minimum, the merit fund portion of the "no trigger" plan described
above would be implemented for staff, with the exception of Executive
Program members. Classified Staff merit increases, as well as
six-month, casual, and casual-restricted increases, would be provided
as explained above in the "no trigger" plan. For A&PS and MAP
employees, the fund pool available for merit increases would be 2%
effective January 1, 1995. Other salary actions that might be
possible would depend on the size of the actual budget cut and
available funding.

If you have any questions or wish to comment, please contact
Judy Johnson, Compensation Manager at extension 40986 or via
electronic mail jjohnson@ucsd.edu.

Rogers Davis Assistant Vice Chancellor - Human Resources