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HR at a Global University

October 15, 2008

Many colleges have stated philosophies about their employment practices. They want faculty salaries to be consistent with those of peer institutions. They want staff members to be paid a “living wage.” They want policies that are “family friendly” or that promote diversity. To be sure, sometimes these philosophies may be more theory than practice, but they provide a framework for employees, managers, trustees and others to evaluate proposed policies.

But what happens when a college opens up a campus in another country? Do these policies work? Or do they fail to provide much guidance at all for some of the tough issues that come with being an employer on multiple continents? The consensus of a panel of consultants and audience members this week at the annual meeting of the College and University Professional Association for Human Resources was that many colleges know a lot more about how to teach abroad than to be an employer abroad -- and that this is creating dilemmas.

Consider this example: A woman said that her institution, when it opened a campus overseas, envisioned tenure track professors going there for several years at a time. So the institution offered generous compensation, relocation, travel and housing payments, including payments for the education of children and the travel of families. Now, a few years in, the institution can’t really persuade tenured faculty members to go away for a few years at a time, so it is trying to get them to go for one semester at a time. At the much shorter duration, should the institution still assume that family members should all go along (and pay associated expenses)? Or is that a waste of resources at a time of tight budgets?

Another audience member described a situation where several faculty members needed to leave a branch campus quickly after they offended religious sensibilities in the country, unintentionally, but in a serious enough away that a departure was in order. Who pays? And who is responsible for teaching the course? Or here’s another question that came up: Responsible employers offer health insurance to employees. But in what circumstances should an American faculty member or administrator be assured not only coverage, but transportation to an American hospital?

While the consultants’ examples came without university names attached and those in the audience spoke without naming their institutions, the reactions of many audience members and several shows of hands suggested that many of these problems are coming up for numerous institutions.

Paul Schafer, a senior consultant at Hewitt Consulting, which works with colleges on these types of issues, says that part of the problem is that American colleges may not realize that their long experience abroad is not generally as an employer. Study abroad is obviously not new, Schafer said. But in many study abroad programs, American colleges simply negotiated deals with foreign institutions, or rented some space. Many American colleges with extensive study abroad programs may have little or no experience as employers of permanent employees.

He outlined a range of the sorts of issues colleges are finding themselves facing -- frequently having stumbled across them rather than planning for them. For example, many American colleges would offer professional employees a comp day after working into the evening or over the weekend. Many European countries are much more formal about such situations -- and an employee in various countries would be entitled to an immediate day off and/or overtime pay. Similarly, Americans are much less generous with vacation time than are many other countries around the world. An American employer may have no legal choice but to offer local employees whatever the local custom is for vacation. But what of U.S. citizens? And do those visiting the branch campus need to be told explicitly that their two months of vacation time don’t extend to their return to the United States?

Bill Dixon, another Hewitt consultant, said that colleges could benefit from learning from the mistakes of American businesses with foreign operations. Many of them started out without clear policies, and just paid whatever it took to get various managers to take positions all over the world. Over time, in many cases because of perceived inequities, these companies developed more formal policies and tried to enforce them. But right now, he said, it appears many American colleges are following the earlier -- non-policy -- approach.

To get through this “morass,” Dixon urged colleges with foreign branch campuses to develop “a global rewards philosophy.” Such a philosophy might cover, for example, the question of whether base salaries should be the same for a given job category for a college all over the world. That may sound equitable, Dixon and others warned, but it may not be, when some postings have extremely low costs of living and housing thrown in. A policy might also state in general terms what happens when people return home -- in terms of their job duties as well as compensation.

Another part of a global rewards philosophy, he said, would be some campus consensus on “who is keeping track of what.” Under higher education’s system of shared governance, he noted, various constituencies have the opportunity for input on various policies. Does this extend to branch campuses? And who is in charge of deciding what’s reasonable? Dixon said that should be part of the policy.

While Dixon noted that faculty members and others on the main American campus will want a say, he noted that another group is also bound to look: the Internal Revenue Service.

Dixon said that at a time that the IRS is increasingly interested in the salaries being paid to well compensated college employees, those who work at branch campuses may be targets for criticism. The number of people with both the skill sets to lead new branches and the willingness to do so is quite small, Dixon said. This has led to packages that are far more generous than people might receive for similar duties at home.

Many colleges justify high salaries by pointing to surveys that demonstrate similarly sized payments to others in similar positions. “But establishing reasonableness for a department chair [at a branch campus] who is making $400,000 a year is tough to do with U.S. surveys,” Dixon said.

 

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