(a) A new appointment to a position in an institution of higher education covered by this subchapter shall not be compensated at a rate of pay greater than the base pay level established for the grade of the position unless a special rate of pay is requested and approved as follows:

(1) (A) An institution may request a special rate of pay for either a current or prospective employee within the institution if:

(i) Prevailing market rates of pay for a specific classification title are such that the institution is unable to competitively recruit at the base pay level for the grade assigned to that classification;

(ii) An acute shortage of qualified applicants for a position within a specific classification exists;

(iii) The institution desires to obtain the services of an exceptionally well-qualified applicant for a specific position;

(iv) The institution desires to retain trained, competent employees; or

(v) It enables the institution to meet any requirements of state or federal laws.

(B)

(i) An institution may request a special rate of pay for a specific classification due to prevailing market rates of pay to hire a new employee up to the midpoint pay level of the appropriate grade of a classification on the appropriate pay plan with the written approval of the Director of the Department of Higher Education.

(ii) An institution may request a special rate of pay for a specific classification due to prevailing market rates of pay to hire a new employee up to the maximum pay level annual rate authorized for the grade assigned to a classification only with the approval of the director after review by the Legislative Council or, if the General Assembly is in session, the Joint Budget Committee.

(iii) A special rate of pay shall not be approved under this section unless the classification is properly reviewed and the special rate of pay is approved as a market-rate classification for the grade and listed on a register of such pay levels by classification maintained by the Department of Higher Education.

(iv) The department shall file a report of all such classifications with the Legislative Council, or if the General Assembly is in session, the Joint Budget Committee, within the month following the approval.

(C)

(i) If a special rate of pay has been approved for a position within a specific classification due to prevailing market rates of pay or an acute shortage of qualified applicants, current employees within the institution assigned to the affected classification may be compensated at the new approved rate of pay by the institution upon written approval by the director.

(ii) The department shall file a report of all the employee salary adjustments under subdivision (a)(1)(C)(i) of this section with the Legislative Council or, if the General Assembly is in session, the Joint Budget Committee, within the month following the approval; or

(2)

(A) An institution may request a special rate of pay for a specific individual applicant due to exceptional qualifications to hire a new employee at a salary level up to and including the midpoint pay level of the appropriate pay grade of a specific position with the written approval of the director and up to the maximum pay level of the appropriate grade with the approval of the director after review by the Legislative Council or, if the General Assembly is in session, the Joint Budget Committee.

(B) An institution may request a special rate of pay to retain a trained, competent employee at a salary level up to and including the midpoint pay level of the appropriate pay grade of a specific position with the written approval of the director and up to the maximum pay level of the appropriate grade with the approval of the director after review by the Legislative Council or, if the General Assembly is in session, the Joint Budget Committee.

(C) This subdivision (a)(2) applies only for the:

(i) Hiring of an exceptionally well-qualified applicant whose background and experience qualify the applicant to perform the job with very little or substantially less orientation and training than would be the case for another qualified applicant; or

(ii) Retention of a trained, competent employee.

(D) Requests by an institution for a special rate of pay for a position based on the exceptional qualifications of a prospective employee may be approved if the:

(i) Institution has documented to the satisfaction of the director that no current employee of the affected institution applied for the position and who was determined by the institution to not be an equivalent alternative to the exceptionally well-qualified applicant. The director shall supply upon request any supporting documentation to the Legislative Council or, if the General Assembly is in session, the Joint Budget Committee; and

(ii) Prospective employee possesses a level of experience or educational credentials that would permit him or her to perform the duties and responsibilities of the position for which the special rate is requested with significantly less training and orientation than all other qualified applicants.

(E) The hiring of a new employee under this subdivision (a)(2) shall not affect the salary level or salary eligibility of any current employee within the institution.

(F)

(i) This section applies to both prospective and current employees of institutions.

(ii) Except as provided in subdivision (a)(2)(B) of this section, this section applies only to current employees in positions in which the position has been advertised and the employee has competitively applied for the position by submitting an application with an institution for consideration for the position. Otherwise, employees shall be compensated in accordance with subsection (d) of this section.

(b) If approval has been granted to a requesting institution for a special rate of pay at or below the midpoint pay level under this section, the director shall report all approvals monthly to the Legislative Council or, if the General Assembly is in session, the Joint Budget Committee.

(c) An employee who is compensated at the maximum pay level in a position assigned to the career service pay plan is eligible for salary adjustments authorized in this subchapter as an addition to his or her base salary up to the career pay level if the:

(1) Employee meets or exceeds the eligibility requirements approved by the department after review by the Legislative Council or, if the General Assembly is in session, the Joint Budget Committee, which shall include at a minimum:

(A) Fifteen (15) cumulative years of full-time equivalent state service that may be in either classified or nonclassified regular positions but not in extra-help positions; and

(B) A performance evaluation rating at or above the satisfactory level for the preceding rating period; and

(2) Additional salary increase does not result in the employee's annual salary's exceeding the career pay level for the grade by classification of the employee's position.

(d)

(1) An employee promoted on or after July 1, 2017, to a position of a higher grade, may receive a maximum annual salary increase of up to ten percent (10%).

(2)

(A) An employee who upon promotion receives an annual salary below the lowest entry pay level established for the new grade may be adjusted to that lowest entry pay level for that grade.

(B) However, an employee's annual salary upon promotion shall not exceed the highest pay level of the grade assigned to the classification, unless the employee is eligible for career pay level on the career service pay plan as established in subdivision (c)(1) of this section.

(e)

(1) When an employee is demoted for cause or voluntarily solicits a demotion, his or her rate of pay shall be fixed in the lower-graded position at a rate equal to ten percent (10%) less than the employee's rate of pay at the time of demotion for demotions of one (1) or more grades on the career service pay plan or on the professional and executive pay plan.

(2) If the employee's salary falls below the lowest entry pay level of the new grade upon demotion, his or her annual salary may be adjusted to that lowest entry level for that grade.

(3) An employee's annual salary upon a demotion shall not exceed the highest pay level within the grade assigned to the classification, unless the employee is eligible for the career pay level on the career pay service pay plan under this section.

(f)

(1) An employee who returns to a position within a classification the employee formerly occupied within a twelve-month period after promotion from the classification is eligible for an annual salary no greater than that for which the employee would have been eligible had the employee remained in the lower-graded classification.

(2) An employee who is placed in a lower-graded position on either compensation plan because the original position has expired due to lack of funding, program changes, or withdrawal of federal grant funds may continue to be paid at the same rate as the employee was being paid in the higher-graded position upon approval of the department after seeking the review of the Legislative Council or, if the General Assembly is in session, the Joint Budget Committee.

(g)

(1) If an employee who has been terminated for more than thirty (30) working days returns to a position within the institution, the institution may offer up to the employee's last annual salary not to exceed the maximum pay level established for the grade.

(2) A former institution employee may return as a new employee should this section provide a lower annual salary than he or she could otherwise receive upon entering state service.

(h) Upon transfer of employment from one institution to another, an employee shall receive a lump-sum payment from the original institution for any overtime that has been accrued and not paid and for any compensatory time accrued that has not been used at the final regular rate of pay received by the employee.