Mr. Gerald Parsky, Chair
Board of Regents
University of California
RE: Action Item 3C (January 18, 2006)
Dear Chair Parsky:
The Regents should not implement last November’s decision on the Senior Leadership Compensation Group (SLCG) as though nothing has happened since then. Over the past few months there has been widespread criticism in the press and the legislature of venality and secrecy in the UC administration’s recent approach to executive compensation. Some individual regents have also commented negatively on the judgment of UC’s top officials. Giving these officials regental license to raise each others’ salaries by as much as $200-300,000 over a three year period without any apparent process of review and oversight would be another big mistake that UC can ill afford as it faces legislative hearings.
In advising you to reconsider the SLGC, we understand the need for a more efficient and systematic way to classify and review executive salaries: we do not object to the new classifications as such but to setting the stage for large across-the-board pay increases in all categories and much larger discretionary increases within each category. The Mercer study, taken on its own terms, is not an adequate basis on which to proceed down this path: it says that “total compensation” is the relevant criterion for all salary comparisons but did not gather data on the “total compensation” of top administrators, as it did for other employees. Now that the “total compensations” of UC top executives has become a matter of public controversy, the Regents should not raise their base pay while its own study of these matters is still pending and should not take steps to reward them massively at a moment when their handling of this issue has brought UC into disrepute.
It may sometimes be necessary for UC to pay higher salaries to attract top people from the outside, but UC should not encourage its present administrators to measure their own worth by the standards of the external market as the Mercer Report does. We doubt, moreover, that they would want market standards to be consistently applied. If it is true that UC pays far too little to attract top people to administrative positions, this is not a reason to pay much more to the people we already have.
The Council of UC Faculty Associations urges you to postpone consideration of Item 3C until it includes safeguards addressing the issues recently raised about executive compensation at UC.
President, Council of UC Faculty Associations
The above letter was quoted in an article published in the San Francisco Chronicle on Janaury 17, 2006. The article was titled “Bill would help state probe university pay; UC calls the move premature during its own investigation” and was written by Todd Wallack and Tanya Schevitz.