Understanding the Step and Grade Proposal
Note: This article was written before we saw OHSU’s wage proposal. I made some edits before publishing, but it doesn’t reflect the frustration and disappointment I feel after yesterday’s presentation.
Our pay ranges have been a source of confusion for management and employees alike since the quartile system was implemented. The quartiles we use to determine where an individual is within their pay range are confusing and make it difficult to understand where you are in relation to a coworker.
Yesterday, we passed our step and grade counter to OHSU so it’s time to give a detailed account of what was proposed and how we got here. This contract belongs to all of us and it’s important that everyone knows what this change will mean for ourselves and our coworkers.
This is a long article because this is a very detail-driven process. For those who don’t want to go through the whole explanation, here’s a quick “too long; didn’t read:”
Summary:
Both teams hated the quartile system and worked together to end it.
Almost everyone will see some sort of raise when the transition happens on July 1, 2026 (OHSU amended this to July 1, 2027 in the economic proposal yesterday).
OHSU’s proposal is for 18 steps (13 regular, 5 longevity). Ours is for 15 (10 regular, 5 longevity).
Both proposals solve the longevity problem by including it in the new pay grade as additional steps. No more waiting for 5 years to see if you qualified or not.
Both teams are interested in being sure no one loses money in this transition, but AFSCME has gone into greater detail making sure that doesn’t happen.
The new system will make it easier to find and highlight pay inequities, but we’ve done our best to make sure that it doesn’t create new ones.
How it Started
AFSCME and OHSU both came to the table this year with a shared interest in creating something that’s more structured, more fair, easier to read, and understand. Rather than having each team create a whole new system from scratch, we worked together to lay out a basic framework so that when OHSU gave us their proposal we would be able to focus on getting the small details right rather than having to argue about broad concepts.
It isn’t how we’d approach every issue, but it worked well in this circumstance because it was a meeting of each team’s numbers-focused members who were all eager to create something better. It’s not every day that we get to meet with management who tell you right away that this isn’t a system they would have advised OHSU to adopt in the first place.
This means OHSU’s proposal was much better than similar proposals we’ve seen in the past. We’d already agreed on core concepts and it was just down to whether the numbers they picked were an improvement for our members or not.
We created calculators to compare the current quartile progression to OHSU’s proposal and everyone we tested would make more money under the new system. The fine print on their proposal has problems that we’ll be addressing, but the basic scale and the stated plan to move people to it are both improvements.
With that knowledge in hand, we have been able to focus on making tweaks and clarifications. We’ve spent the weeks since they made their proposal trying out different concepts, building more calculators to compare plans, and looking for where there will be unintended problems that pop up in the transition.
Quartiles
First, let’s talk about the current system so that it’s clear where things are improving.
We’ll use a Patient Access Specialist (PAS) as our first example because that’s what I am and there are so many of us across the hospital side of OHSU.
Under the current system, PAS are in range A23. This means that if we make between $23.63 and $25.71 per hour, we’re in the first quartile and get a 4% raise on our anniversary, between $25.72 and $27.80, we get a 2.75% raise on our anniversary, and so on (see scale below or pull up the Compensation Plan FY2025 file on O2 under Human Resources/Benefits and Pay). Our pay is effectively capped at $31.98 per hour (we’ll talk more about the current problems with the longevity rate and why we’re not including it later on).
Image of spreadsheet titled AFSCME Hourly Pay Ranges effective July 1, 2024. Breaks down Anniversary Increase by pay range, broken into quartiles. A23 is highlighted.
There’s a roughly 3% difference between the pay ranges (between A22, A23, and A24, for example) and 35.34% difference between the lowest and highest value for this specific range. Under the current system, not including any other raises (both for simplicity’s sake and because in our new system the pay ranges will move with our across the board increases), it takes 13 raises to get from the lowest to highest pay.
Because the difference between ranges varies and the nature of percentages when applied to larger numbers, this isn’t consistent across all hourly pay ranges. For example, an hourly Pharmacist in A62 ends up with a 37.3% difference and 14 raises to get from their lowest to highest pay (again, not counting longevity).
Our workers in the trades (T10-T30) like Painters in T12 and Refrigeration Mechanics in T18 have a very short scale with just 5 raises and only about 17% between their lowest and highest pay. Getting to the top of the scale sooner rather than later has its advantages, but this greatly reduces their ability to have their pay grow over their years at OHSU.
Our workers in salary ranges are the ones who will see the most dramatic changes when moving into the new system. Currently, their raises and difference between grades are much more consistent than the hourly grades. All of their ranges are 5% apart with a 51.43% difference between the lowest and highest pay.
The wider gap between lowest and highest pay means that it takes 19 raises to get to the top of the range. If you’re hired at the lowest pay and never receive a merit-based increase or move to a new position, it takes almost two decades to even begin the timer for a longevity raise under the current system.
While the consistency of the salary ranges are something we wanted to mimic in the new system, that scale is unacceptable.
The Problem With Longevity
Our Longevity language has been tweaked over the years, but it’s still insufficient and there are scores of employees who should have qualified but have not gotten their raises because they were as little as a penny off from the highest pay for their range. The way that it should work is that after five years at the top of your range, you get a 3% raise.
In practice, if your highest pay is $35 and you’re paid $34.98 then the timer hasn’t started. When you get to $35 it will start, but if the range moves on you then this process starts over again.
Because so few people have actually received their longevity raise, we did not include it when deciding if changes were beneficial to our members or not. We let it be a cherry on top of a system with solid fundamentals.
OHSU’s proposal solves this by including Longevity in the new pay scales and giving a small raise every year once you reach the top instead of a nebulous promise to give one someday. Credit where credit is due: this was their idea and we believe it’s a good one.
OHSU’s Proposal
This section will be focusing on the scale itself and how it works with an explanation of what we disliked about their proposal later on.
OHSU’s proposal came in the form of a spreadsheet and a document with language that described the transition. It takes a long time to rebuild pay scales for 8500 workers, so they propose aiming for July 1, 2026 (their economic proposal on June 10th amended this to July 1, 2027). This will give all of us the across the board increase we’re still negotiating on top of whatever bump happens as part of this transition. Their initial estimates were that it would take 12-18 months to implement.
The spreadsheet showed a scale that takes a total of 18 steps to get from lowest to highest pay for all pay grades. Rather than a 17-51% difference, everyone will have a roughly 41.6% difference between lowest and highest pay. Those 18 steps include 5 years of longevity raises. This means everyone gets to the highest regular pay in the 13 steps that many hourly employees currently do.
We discussed the transition, with both teams agreeing on these broad concepts:
Pay ranges will be placed into the new grades based on finding the grade that is closest, but equal to or higher than the existing range. No job classification will see a reduction in pay and most will see at least a small raise.
Individuals will be placed into the step in their grade that is equal to or higher than what they are currently paid. So if you’re between steps 4 and 5, you’re placed in step 5. This will also result in at least a small raise for almost everyone in our bargaining unit.
As written, OHSU states they will move people who are at or above the maximum regular pay for their position into the longevity rate that matches their years of service. So, theoretically people who have been at longevity for 3 years would be placed into step 15 and people who have been at longevity for 5 or more years would be placed at step 18, even if they haven’t gotten a longevity raise in the past.
One thing everyone liked about the quartile system is that it gave higher raises to new employees to promote retention and quickly increase their earning potential. They kept this, giving steps 2 and 3 a 4% raise, steps 4 through 7 a 2.75% raise, steps 8 through 11 a 2% raise, and steps 12 and 13 a 1.5% raise. Their longevity raises are 1.5% for the first two years and .75% for years 3 through 5.
Overall, this is a great approach and we’re confident that with this as the basis, we’re going to find a solution that benefits everyone in the bargaining unit.
We’ll talk more about how the transition will work in the summary of our proposal.
OHSU also proposed new language that will allow new employees to be placed into the step that is appropriate for their experience. So someone with 5 years of direct experience may start at step 5 instead of being defaulted to step 1.
While that is a good thing, it also may have you wondering what to do if you’ve been here longer than them and are paid less. The new step and grade system will make it easier to determine whether you’re making less or not since you’ll be able to directly see what step both parties are on and more equally weigh qualifications and past experience. This new system should not create inequity, but it may highlight a lot of existing problems.
The transition may shine a light on a lot of departments or classifications where there were already equal pay issues. This isn’t the main goal of this transition, but it is something we’ve been very aware of as we’ve crafted our counter. If this happens in July, I won’t personally be surprised if there are a lot of grievances by September.
I see that as a good thing, though. These will be old problems we’ve dragged out into the sun.
AFSCME’s Counter
Our proposal is not radically different from OHSU’s, but it does shorten the scale and clarify the details of the transition. OHSU sent us their spreadsheet, but there wasn’t actually a description of it in the contract. We’ve corrected that.
Differences:
OHSU proposed 18 total steps and we’ve proposed 15.
OHSU removed the longevity language entirely, but we thought it was important to recognize that those final, smaller steps are specifically to reward those who have stayed at OHSU through thick and thin. Our proposal clarifies that steps 1 through 10 are regular raises and 11 through 15 are for longevity.
OHSU kept hourly employees at the existing, variable percentages between grades but we have proposed a flat 4% between each grade. Currently hourly pay grades have between a 2.25% and 3.16% difference. We believe that if we’re putting together a better system, we should pull the band-aid all the way off and remove all of the inconsistencies of the current approach.
OHSU’s salary grade was built by taking hourly equivalents and increasing by 7%, but frankly there are many salary positions that don’t have hourly equivalents and this didn’t make a lot of sense to us, so we built a new scale. We used the top of the 4th quartile of the lowest grade, built backwards to step 1, and then increased by 4% between grades, just like the hourly scale.
Our raises are 4% for steps 2 through 4 and 3% for steps 5 through 10. Longevity raises are 1.5% for the first 2 years and 1% per year for years 3 through 5. This adds about 1% to the total range from lowest to highest pay for each pay grade over OHSU’s proposal.
Clarified the transition process for hourly, trade, and salary employees.
The Transition
Here’s our proposal for handling the transition and our reasoning why:
Hourly workers will be matched to the scale that starts as close to, but is greater than their existing minimum pay as possible. Because there is an increase in the percentage between the lowest and highest pay, this ensures that no one is paid less and everyone has the potential to make more.
Workers in the trades will be matched to the scale that starts as close to, but is greater than their existing minimum pay as possible. Because their pay scale is currently so short (around 17% total from minimum to maximum), this means all of these workers will have a much higher possible maximum salary while also making sure no one is hired under the existing minimums. We don’t want to give OHSU room to pay people less.
Salary workers will have the lowest salary grade determined by taking the existing minimum range, working backwards from the 4th quartile maximum to a new step 1, and increasing each grade by 4%. All ranges will be matched to the grade that matches step 10 to their existing 4th quartile maximum (also choosing the one that is equal to or greater than their existing). This ensures that since the current salary ranges are so much wider than hourly’s, we only cut off the bottom and never reduce anyone’s maximum pay. Those who are below the new minimum pay for the appropriate grade will be moved to the new minimum, regardless of how much that will increase their pay.
This transition is going to highlight and correct a lot of pay inequities that have been hidden by how confusing the old system was as well as a long history of American workers being taught that talking about our pay with each other is ungrateful or uncouth. The more sunlight we can put on our pay scale, the more fair it can be.
What Didn’t Work
We’ve praised OHSU more than usual in this article, but there were still problems with their proposal.
One big thing we’ve struck is that they wanted to freeze the pay of anyone who is above the new pay scale, even including longevity, until the scale can “catch up.” We’re not interested in reducing or freezing any of our members’ pay and our own research showed that this applied to a shockingly small number of people. I understand the desire to just shove everyone into the new system so that it works perfectly, but this amounts to rounding errors in their budget. A handful of grandfathered individuals aren’t going to be a real problem.
OHSU wanted to cut merit-based wage increases from the contract completely. Their argument is that this step and grade system should allow people to be placed into the correct step for their education and level of experience, but that’s not something we’re willing to put all of our faith in just yet. Additionally, people receive more education after being hired or go above and beyond in ways that should be rewarded. We have re-proposed our last version of this language.
OHSU cut the minimum percentage from promotions and reclassifications because keeping the same step in the new grade should give the same or similar raise as what people were previously guaranteed, but we feel the language is important as a “just in case.” In theory, no one should be able to be moved into a higher grade without getting the guaranteed 4% based on our proposal, but there isn’t value in removing this contractual obligation. It may no longer serve the same function, but it will make it clearer to employees what to expect and give us leverage if someone is moved in a way that isn’t anticipated.
OHSU tried to change some of the thresholds for review of pay in the language for the Market-Based Wage Committee, but we have no interest in moving these in a way that benefits the employer. Especially when we’re making such a massive change that will likely result in a host of new reviews over the coming years.
If those changes to the Market-Based Wage Committee are really needed once the dust has settled, they can bring it back to the table in 2028.
How it’s Going
This has been a rewarding and collaborative process. It’s how I wish bargaining with OHSU always worked. We had shared interests, we weren’t worlds apart, and both teams wanted to ensure the transition goes smoothly and benefits everyone involved.
After seeing OHSU’s wage proposal yesterday, it makes it that much more frustrating that we’re not able to work this way more often.
Now that we have OHSU’s proposal, we’ll be creating calculators to let you compare our plan to theirs. We want you to have those tools as soon as possible, but it will take some time to create them.