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University of Wisconsin-La Crosse Discretionary Merit Compensation Policy Effective: September 1, 2014

I. Background

The 2013-15 State of Wisconsin Compensation Plan provides appointing authorities with authorization to award Discretionary Merit Compensation (DMC) adjustments to classified permanent and project employees, except for Crafts Worker and related employees. This procedure establishes the guidelines for processing and authorizing lump sum and/or base building Discretionary Merit Compensation (DMC) awards for eligible employees at UW-La Crosse.

II. References



III. Discretionary Merit Compensation Criteria

The following criteria for awarding a DMC have been provided by the Office of State Employment Relations.

Merit – Employee has sustained a high level of performance for a long period. The expectation is that the high level of performance will remain. Merit criteria/factors which should be considered include:


  • Length or frequency of the outstanding performance.
  • Overall significance or importance of the employee’s work products to the organization.
  • Regularity with which the outstanding performance or unique contribution is demonstrated (e.g., an employee who routinely demonstrates exceptional performance and performs special projects on an ongoing basis, as compared to an employee who completes a one-time special project).

Additional elements to consider include:

  • Employee performs new duties that are permanent and of greater scope, impact, and/or complexity than previous functions. An updated job description should be completed to reflect new duties. The new position description should be reviewed with the HR Office to determine if the position should be reclassified. If reclassification is appropriate, this should be done prior to a DMC being submitted/approved/applied
  • Employee demonstrates increased and significant competencies which are directly related to the permanent assignment.


IV. Eligibility for Discretionary Merit Compensation

In order to receive a DMC for merit, the employee must have had a performance evaluation conducted within the past 12 months. All employees in pay status whose pay administration is covered by the Compensation Plan are eligible to be considered for a DMC, except the following employees as defined in the Wisconsin Human Resources Handbook, Chapter 550, Discretionary Merit Compensation (DMC) Program Guidelines:


  • Employees whose job performance in the previous fiscal year was rated below satisfactory.
  • Supervisors who did not complete formal performance evaluations on all subordinate employees for whom performance evaluations are required within the past 12 months
  • Any employee paid at or above the applicable pay range maximum may not receive a base-building DMC.
  • Trainees eligible for scheduled trainee increases.
  • Crafts worker-related employees (permanent and project craft workers, Crafts Worker Supervisors).
  • Employees serving a fixed term appointment.
  • Employees whose funding source does not have available funds.


V. Amount & Frequency

Employees may receive a maximum of four within-range-pay steps in a fiscal year, subject to the maximum of the pay range. Classified permanent and project positions that are in broadbanded and non-broadbanded pay ranges may be granted an adjustment in the form of a lump sum and/or base building adjustment.

VI. Effective Receipt

A DMC may be granted at any time during the fiscal year in accordance with approved polices. The effective date of a lump sum adjustment will be the date the payment is made after OSER approval. No DMC may be retroactive.

Effective receipt shall be considered the date the completed request is received by the Human Resources Department. A completed request must include a justification that meets the DMC criteria.

VII. DMC Limits & Adjustments

DMCs will be granted to eligible employees based upon the following limits and guidelines:


  • DMC awards may be granted as a lump sum payment amount equal to a “one within-range-pay step”, a “two within-range-pay step” or a “three within-range-pay step”.
  • DMC amounts are limited to four within pay range steps (WRPS) of the employee’s pay range per fiscal year.
  • Any funding sources with initial amounts or remaining amounts after other DMC awards that are less than a “one within-range-pay step” may award that amount as a DMC.
  • Lump sum DMCs must be converted to a base pay equivalent by dividing the lump sum amount by 2088; this will ensure that the fiscal year WRPS limitation is not exceeded.
  • The approval, denial, amount, and type of DMC are not grievable.
  • Employees are not eligible for DMC if broadband pay upon appointment was used in the same fiscal year.
  • Employees may self-nominate for a DMC no more than once per fiscal year.


VIII. Approval Process

All DMC requests must include a complete justification that meets the established criteria. DMC requests can be initiated by supervisors and nominating representatives from the department or division, or eligible employees can self-nominate. Eligible employees who choose to self- nominate for a DMC may do so once every fiscal year.

The approval process for DMC requests is initiated through the online Discretionary Merit Compensation Administrator at /Human-Resources/Discretionary-Merit-Compensation/. In order for a DMC to be granted, the request must be approved through the following process:


  1. Division: The applicant and supervisor or nominating representative review the eligibility requirements and criteria for a DMC and forward to the Dean/Director. The Dean/Director will be responsible for reviewing the DMC request to ensure the eligibility requirements and criteria are met and forwarding a recommendation to the Division Head for final review and approval.
  2. UW-La Crosse: Human Resources is responsible for reviewing the DMC request approved at the Division level for completeness. The request is then forwarded to the Chancellor or the Chancellor’s designee for approval or denial.
  3. University of Wisconsin System Administration & Office of State Employment Relations (OSER): Once approved by the Chancellor or Chancellor’s designee, the DMC request will be submitted to OSER for their approval with a copy sent to UW System Administration. OSER approval is required for all DMC recommendations.