Part 1 – GOVERNANCE
SECTION: General Administration
POL 1-019 Pr
Executive Director compensation
Effective date: July 1, 2009
Approval date: May 3, 2009
Last revised: May 3, 2009
Cancelled date:
Reference: Bylaw VII, Sec.5(2)
Cross reference: POL 1-006, Consumer Price Index,
American Research Company National Compensation Study; Association Chief Executives
PROCEDURES
The Committee overseeing the Executive Director (ED) compensation may create a task force to conduct an annual evaluation of the ED’s performance, and make recommendations for appropriate adjustments in compensation. The task force will also make updates as needed to the ED’s employment contract and job description.
Composition of task force
President (task force leader)
Treasurer
President Elect
Chair of the parent committee
1 elected Board member from the parent committee selected by the committee
1. The President has full voting rights within the task force. The President may delegate tasks and coordinating functions to another task force member in the event the President is not able to do so, to ensure that the tasks are performed in a timely manner.
2. An independent legal counsel specializing in human resources and benefits administration will be retained to hold the ED’s official personnel records, and to provide the Board and the task force with advice on legal matters relating to the employment contract and job description.
3. An external consulting organization specializing in human resources and benefits administration will be retained to assist with the annual performance evaluation process, to conduct research and provide guidance regarding changes to compensation, and to conduct the 360 Degree review process.
Timeline
As the processes associated with the task are time sensitive, the task force is responsible for creating an annual timeline that defines due dates for each step in the process and for ensuring that each step is completed in a timely manner.
Effective date of employment contract
The effective date of the ED’s employment contract is the first day of the Association fiscal year. The term of employment will be defined within the contract; however, the end of the contract term will be the last day of the Association fiscal year.
360 Degree review
If Association resources permit, this review will be completed approximately 6 months before the ED’s annual performance assessment. The review should include, at a minimum, the entire Board of Directors and direct staff reports. The 360 Degree review is for the ED’s benefit, to provide a benchmark for further improvement, and does not impact the annual performance evaluation. The task force will work with its human resources consultant to conduct the 360 Degree Review. The task force timeline for the year must account for the following steps:
1. The task force and the human resources consultant will review the 360 Degree Review questionnaire.
2. The ED will submit the names of staff who will participate in the 360 Degree Review.
3. The 360 Degree Review will be sent to designated staff and the entire Board of Directors.
4. Participants in the 360 Degree Review will complete the questionnaire.
5. The Human Resources consultant will prepare a 360 Degree Review Summary for the ED and the task force.
6. The task force will submit the summary to the Board.
7. Based on the results of the 360 Degree Review, the ED will identify and define performance objectives for the coming year and will submit these to the task force for discussion during the annual performance evaluation meeting.
Annual evaluation:
The annual evaluation of the ED’s performance against the goals and objectives established at the previous year’s evaluation will be conducted. The evaluation will be scheduled accordingly so that results of the review can be discussed by the Board. Any changes to compensation or to the ED contract will occur after the Board’s discussion of the performance evaluation. The task force timeline for the year must account for the following steps:
1. The task force and the human resources consultant will review the performance evaluation survey questionnaire.
2. The human resources consultant will format the questionnaire for delivery to the Board.
3. The Board will receive the questionnaire and complete it.
4. The human resources consultant will review and analyze the results.
5. Based on the results of the evaluation, the task force will establish goals and objectives the ED will be charged with to accomplish the following year. This process will be completed in full consultation with the ED.
6. The task force and the human resources consultant will present a summary of the results to the Board during an executive session at the annual Spring Board Meeting.
7. The Board will discuss the ED’s performance at executive session at the Fall Board meeting, and determine by simple majority vote if the task force is to enter into negotiations with the ED for an additional contract term.
Contract renewal and compensation:
If the vote is affirmative, the Board shall agree upon the following parameters for the task force to negotiate:
1. Term of contract: The Board shall specify the term of the contract, or range of years that the task force may use in negotiations.
2. Annual increase: The task force shall have the freedom to negotiate an annual increase within parameters established by the Board using the tools such as the Consumer Price Index or the American Research Company National Compensation Study, Association Chief Executives.
3. Incentive payments/bonuses: The task force shall recommend to the Board any incentive payments or bonuses being considered for the contract term under review. The Board shall agree to or modify the recommendation as appropriate prior to any communication with the ED.
4. Other terms and conditions: By affirmative vote of 2/3 of the Board, the Board shall set any additional parameters upon the task force as deemed necessary.
Delivery of performance evaluation:
Before the end of the fiscal year, the President will meet with the ED to:
1. Deliver the results of the performance evaluation and discuss the ED’s goals for the following year.
2. Discuss changes, if any, to the ED’s contract.
3. Deliver changes to compensation.
Termination of employment contract:
If the Board votes to terminate the contract of the ED, the Board will empower the task force to take the following action:
1. Provide immediate written and verbal notice to the ED of the Board’s decision.
2. Oversee the transition of the ED’s employment in accord with the employment contract.
3. Recommend to the Board an interim ED, who shall assume the responsibilities of the outgoing ED as soon as practicable.
4. Request the parent committee to create a task force, which will:
(a) develop search criteria, subject to Board approval
(b) contract with an executive search firm, subject to Board approval
(c) interview candidates screened and recommended by the search firm
(d) select second and first choice candidates
(e) recommend final candidate to the Board for discussion
(f) extend offer to candidate based on Board vote.
Reporting:
1. The task force will report to the parent committee on a monthly basis while the task force is active.
2. The task force will create a report summarizing its activities at the end of the ED compensation process, which will be provided to the successor task force the following year.
The task force will not:
1. Enter into any agreement or contract that provides for an automatic renewal of the employment contract.
2. Enter into any agreement or contract that provides for retroactive terms or conditions prior to the expiration of the current contract.
3. Act contrary to legal advice.
Questions about previous Policies & Procedures? Contact Connie Hardy, Corporate Secretary.