Representative Kay J. Christofferson proposes the following substitute bill:


1     
STATE EMPLOYMENT REVISIONS

2     
2023 GENERAL SESSION

3     
STATE OF UTAH

4     
Chief Sponsor: Kay J. Christofferson

5     
Senate Sponsor: Evan J. Vickers

6     

7     LONG TITLE
8     General Description:
9          This bill modifies provisions relating to state employment.
10     Highlighted Provisions:
11          This bill:
12          ▸     provides for certain career service employees to make a voluntary election to
13     convert to career service exempt status;
14          ▸     modifies a provision relating to the responsibilities of the director of the Division of
15     Human Resource Management;
16          ▸     modifies definitions applicable to a pay-for-performance management system;
17          ▸     allows a state independent entity to choose to participate in a pay-for-performance
18     plan under a pay-for-performance management system;
19          ▸     establishes a schedule AY position as a career service exempt position;
20          ▸     provides for employees in a schedule B career service status position who have not
21     completed probation to become career service exempt employees if the position is
22     changed to a schedule AY position; and
23          ▸     modifies provisions related to employee salary ranges.
24     Money Appropriated in this Bill:
25          None

26     Other Special Clauses:
27          This bill provides a special effective date.
28     Utah Code Sections Affected:
29     AMENDS:
30          63A-17-102, as last amended by Laws of Utah 2022, Chapter 209
31          63A-17-106 (Effective 07/01/23), as last amended by Laws of Utah 2022, Chapters
32     166, 169, 177, and 209
33          63A-17-112 (Effective 07/01/23), as enacted by Laws of Utah 2022, Chapter 209
34          63A-17-301, as last amended by Laws of Utah 2022, Chapter 209
35          63A-17-304, as last amended by Laws of Utah 2022, Chapter 169
36          63A-17-307, as last amended by Laws of Utah 2022, Chapters 169 and 209
37     

38     Be it enacted by the Legislature of the state of Utah:
39          Section 1. Section 63A-17-102 is amended to read:
40          63A-17-102. Definitions.
41          As used in this chapter:
42          (1) "Agency" means any department or unit of Utah state government with authority to
43     employ personnel.
44          (2) "Career service" means positions under schedule B as defined in Section
45     63A-17-301.
46          (3) "Career service employee" means an employee who [has successfully completed]:
47          (a) before July 1, 2023, successfully completes a probationary period of service in a
48     position covered by the career service[.]; and
49          [(4) "Career service status" means status granted to employees who successfully
50     complete probationary periods for competitive career service positions.]
51          (b) on or after July 1, 2023, does not voluntarily:
52          (i) accept appointment to a position or status exempt from career service; or
53          (ii) elect to convert to a status exempt from career service.
54          (4) "Career service status" means status granted to an employee who, before July 1,
55     2023, successfully completes the applicable probationary period for a competitive career
56     service position.

57          (5) "Classified service" means those positions subject to the classification and
58     compensation provisions of Section 63A-17-307.
59          (6) "Controlled substance" means controlled substance as defined in Section 58-37-2.
60          (7) (a) "Demotion" means a disciplinary action resulting in a reduction of an
61     employee's current actual wage.
62          (b) "Demotion" does not mean:
63          (i) a nondisciplinary movement of an employee to another position without a reduction
64     in the current actual wage; or
65          (ii) a reclassification of an employee's position under the provisions of Subsection
66     63A-17-307(3) and rules made by the department.
67          (8) "Director" means the director of the division.
68          (9) "Disability" means a physical or mental disability as defined and protected under
69     the Americans with Disabilities Act, 42 U.S.C. Section 12101 et seq.
70          (10) "Division" means the Division of Human Resource Management, created in
71     Section 63A-17-105.
72          (11) "Employee" means any individual in a paid status covered by the career service or
73     classified service provisions of this chapter.
74          (12) "Examining instruments" means written or other types of proficiency tests.
75          (13) "Human resource function" means those duties and responsibilities specified:
76          (a) under Section 63A-17-106;
77          (b) under rules of the division; and
78          (c) under other state or federal statute.
79          (14) "Market comparability adjustment" means a salary range adjustment determined
80     necessary through a market survey of salary data and other relevant information.
81          (15) "Probationary employee" means an employee serving a probationary period in a
82     career service position but who does not have career service status.
83          (16) "Probationary period" means that period of time determined by the division that an
84     employee serves in a career service position as part of the hiring process before career service
85     status is granted to the employee.
86          (17) "Probationary status" means the status of an employee between the employee's
87     hiring and the granting of career service status.

88          (18) "Structure adjustment" means a division modification of salary ranges.
89          (19) "Temporary employee" means [career service exempt employees] an employee
90     described in Subsection 63A-17-301(1)[(r)](s), with career service exempt status.
91          (20) "Total compensation" means salaries and wages, bonuses, paid leave, group
92     insurance plans, retirement, and all other benefits offered to state employees as inducements to
93     work for the state.
94          Section 2. Section 63A-17-106 (Effective 07/01/23) is amended to read:
95          63A-17-106 (Effective 07/01/23). Responsibilities of the director.
96          (1) As used in this section, "miscarriage" means the spontaneous or accidental loss of a
97     fetus, regardless of gestational age or the duration of the pregnancy.
98          (2) The director shall have full responsibility and accountability for the administration
99     of the statewide human resource management system.
100          (3) Except as provided in Section 63A-17-201, an agency may not perform human
101     resource functions without the consent of the director.
102          (4) Statewide human resource management rules made by the division in accordance
103     with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, shall take precedence if there
104     is a conflict with agency rules, policies, or practices.
105          (5) The division may operate as an internal service fund agency in accordance with
106     Section 63J-1-410 for the human resource functions the division provides.
107          (6) The director shall:
108          (a) develop, implement, and administer a statewide program of human resource
109     management that will:
110          (i) aid in the efficient execution of public policy;
111          (ii) foster careers in public service for qualified employees; and
112          (iii) render assistance to state agencies in performing their missions;
113          (b) design and administer the state pay plan;
114          (c) design and administer the state classification system and procedures for determining
115     schedule assignments;
116          (d) design and administer the state recruitment and selection system;
117          (e) administer agency human resource practices and ensure compliance with federal
118     law, state law, and state human resource rules, including equal employment opportunity;

119          (f) consult with agencies on decisions concerning employee corrective action and
120     discipline;
121          (g) maintain central personnel records;
122          (h) perform those functions necessary to implement this chapter unless otherwise
123     assigned or prohibited;
124          (i) perform duties assigned by the governor, executive director, or statute;
125          (j) make rules for human resource management, in accordance with Title 63G, Chapter
126     3, Utah Administrative Rulemaking Act;
127          (k) establish and maintain a management information system that will furnish the
128     governor, the Legislature, and agencies with current information on authorized positions,
129     payroll, and related matters concerning state human resources;
130          (l) conduct research and planning activities to:
131          (i) determine and prepare for future state human resource needs;
132          (ii) develop methods for improving public human resource management; and
133          (iii) propose needed policy changes to the governor;
134          (m) study the character, causes, and extent of discrimination in state employment and
135     develop plans for its elimination through programs consistent with federal and state laws
136     governing equal employment opportunity in employment;
137          (n) when requested by charter schools or counties, municipalities, and other political
138     subdivisions of the state, provide technical service, training recommendations, or advice on
139     human resource management at a charge determined by the director;
140          (o) establish compensation policies and procedures for early voluntary retirement;
141          (p) confer with the heads of other agencies about human resource policies and
142     procedures;
143          (q) submit an annual report to the executive director, the governor, and the Legislature;
144     and
145          (r) assist with the development of a vacant position report required under Subsection
146     63J-1-201(2)(b)(vi).
147          (7) (a) After consultation with the executive director, the governor, and the heads of
148     other agencies, the director shall establish and coordinate statewide training programs,
149     including training described in Subsection (7)(e).

150          (b) The programs developed under this Subsection (7) shall have application to more
151     than one agency.
152          (c) The division may not establish training programs that train employees to perform
153     highly specialized or technical jobs and tasks.
154          (d) The division shall ensure that any training program described in this Subsection (7)
155     complies with Title 63G, Chapter 22, State Training and Certification Requirements.
156          (e) (i) As used in this Subsection (7)(e):
157          (A) "Employee" means the same as that term is defined in Section 63A-17-112.
158          (B) "Supervisor" means an individual in a position at an agency, as defined in Section
159     63A-17-112, that requires the regular supervision and performance evaluation of an employee.
160          (ii) A supervisor shall attend the training:
161          (A) within six months of being promoted or hired to the position of supervisor; and
162          (B) at least annually.
163          (iii) [Training attendance] Completion of the training and the effective use of training
164     information and principles shall be considered in an evaluation of a supervisor's job
165     performance.
166          (iv) The training shall include:
167          (A) effective employee management and evaluation methods based on the pay for
168     performance management system described in Section 63A-17-112;
169          (B) instruction to improve supervisor and employee communications;
170          (C) best practices for recognizing and retaining high-performing employees;
171          (D) best practices for addressing poor-performing employees; and
172          (E) any other information and principles identified by the division to improve
173     management or organizational effectiveness.
174          (8) (a) (i) The division may collect fees for training as authorized by this Subsection
175     (8).
176          (ii) Training funded from General Fund appropriations shall be treated as a separate
177     program within the department budget.
178          (iii) All money received from fees under this section will be accounted for by the
179     department as a separate user driven training program.
180          (iv) The user training program includes the costs of developing, procuring, and

181     presenting training and development programs, and other associated costs for these programs.
182          (b) (i) Funds remaining at the end of the fiscal year in the user training program are
183     nonlapsing.
184          (ii) Each year, as part of the appropriations process, the Legislature shall review the
185     amount of nonlapsing funds remaining at the end of the fiscal year and may, by statute, require
186     the department to lapse a portion of the funds.
187          (9) Rules described in Subsection (6)(j) shall provide for at least three work days of
188     paid bereavement leave for an employee:
189          (a) following the end of the employee's pregnancy by way of miscarriage or stillbirth;
190     or
191          (b) following the end of another individual's pregnancy by way of a miscarriage or
192     stillbirth, if:
193          (i) the employee is the individual's spouse or partner;
194          (ii) (A) the employee is the individual's former spouse or partner; and
195          (B) the employee would have been a biological parent of a child born as a result of the
196     pregnancy;
197          (iii) the employee provides documentation to show that the individual intended for the
198     employee to be an adoptive parent, as that term is defined in Section 78B-6-103, of a child born
199     as a result of the pregnancy; or
200          (iv) under a valid gestational agreement in accordance with Title 78B, Chapter 15, Part
201     8, Gestational Agreement, the employee would have been a parent of a child born as a result of
202     the pregnancy.
203          Section 3. Section 63A-17-112 (Effective 07/01/23) is amended to read:
204          63A-17-112 (Effective 07/01/23). Pay for performance management system --
205     Employees paid for performance.
206          (1) As used in this section:
207          (a) (i) "Agency" means, except as provided in Subsection (1)(a)(ii), the same as that
208     term is defined in Section 63A-17-102.
209          (ii) "Agency" does not include the State Board of Education, the Office of the State
210     Treasurer, Office of the State Auditor, Office of the State Attorney General, Utah System of
211     Higher Education, the Legislature, the judiciary, or[, as defined in Section 63E-1-102,] an

212     independent entity.
213          (b) (i) "Employee" means an employee of an agency.
214          (ii) "Employee" does not include:
215          (A) an individual in a schedule AB position, as described in Section 63A-17-301[,
216     position.];
217          (B) an individual in a position that does not receive retirement benefits under Title 49,
218     Utah State Retirement and Insurance Benefit Act; or
219          (C) an individual hired for a position that has a duration of less than 12 consecutive
220     months.
221          (c) "Independent entity" means the same as that term is defined in Section 63E-1-102.
222          [(c)] (d) "Pay for performance" means a plan:
223          (i) for incentivizing an employee [for meeting or exceeding] to meet or exceed
224     production or performance goals[, in which the plan];
225          (ii) that is well-defined before work begins[, eligible work groups are defined,]; and
226          (iii) under which specific goals and targets for the employee are determined[,] and
227     measurement procedures are in place[, and specific incentives are provided when goals and
228     targets are met].
229          [(d)] (e) "Pay for performance management system" means the system described in
230     Subsection [(2)] (3).
231          (2) The division shall establish and, in accordance with Title 63G, Chapter 3, Utah
232     Administrative Rulemaking Act, make rules for the administration of a pay for performance
233     management system.
234          (3) The pay for performance management system shall include:
235          (a) guidelines and criteria for an agency to adopt pay for performance policies and
236     administer pay based on an employee's performance in furtherance of the agency's mission;
237          (b) employee performance ratings;
238          (c) requirements for written employee performance standards and expectations;
239          (d) supervisor verbal and written feedback based on the standards of performance and
240     behavior outlined in an employee's performance plan; and
241          (e) quarterly written evaluation of an employee's performance.
242          (4) In consultation with the division, no later than July 1, 2023, each agency shall:

243          (a) adopt pay for performance policies based on the performance management system;
244     and
245          (b) subject to available funds and as necessary, adjust an employee's wage to reflect:
246          (i) subject to Subsection (5), for a classified service employee, the salary range of the
247     position classified plan for the employee's position; and
248          (ii) an increase, decrease, or no change in the employee's wage:
249          (A) commensurate to an employee's performance as reflected by the employee's
250     evaluation conducted in accordance with the pay for performance management system; and
251          (B) in an amount that is in accordance with the guidelines and criteria established for a
252     wage change in the pay for performance management system.
253          (5) (a) Notwithstanding Subsection (1)(a)(ii), an independent entity may choose to
254     adopt pay for performance policies in accordance with the performance management system
255     established by the division under this section.
256          (b) An independent entity that chooses to adopt pay for performance policies:
257          (i) shall provide written notification to the division of the independent entity's choice;
258     and
259          (ii) is subject to this section and division rules made under this section to the same
260     extent as an agency described in Subsection (1)(a)(i).
261          [(5)] (6) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking
262     Act, the division shall make rules authorizing a classified service employee to receive a wage
263     that exceeds the salary range of the classified service employee's position classified plan if
264     warranted based on the classified employee's performance rating.
265          Section 4. Section 63A-17-301 is amended to read:
266          63A-17-301. Career service -- Exempt positions -- Schedules for civil service
267     positions -- Coverage of career service provisions.
268          (1) Except as provided in Subsection (3)(d), the following positions are exempt from
269     the career service provisions of this chapter and are designated under the following schedules:
270          (a) schedule AA includes the governor, members of the Legislature, and all other
271     elected state officers;
272          (b) schedule AB includes appointed executives and board or commission executives
273     enumerated in Section 67-22-2;

274          (c) schedule AC includes all employees and officers in:
275          (i) the office and at the residence of the governor;
276          (ii) the Public Lands Policy Coordinating Office;
277          (iii) the Office of the State Auditor; and
278          (iv) the Office of the State Treasurer;
279          (d) schedule AD includes employees who:
280          (i) are in a confidential relationship to an agency head or commissioner; and
281          (ii) report directly to, and are supervised by, a department head, commissioner, or
282     deputy director of an agency or its equivalent;
283          (e) schedule AE includes each employee of the State Board of Education that the State
284     Board of Education designates as exempt from the career service provisions of this chapter;
285          (f) schedule AG includes employees in the Office of the Attorney General who are
286     under their own career service pay plan under Sections 67-5-7 through 67-5-13;
287          (g) schedule AH includes:
288          (i) teaching staff of all state institutions; and
289          (ii) employees of the Utah Schools for the Deaf and the Blind who are:
290          (A) educational interpreters as classified by the division; or
291          (B) educators as defined by Section 53E-8-102;
292          (h) schedule AN includes employees of the Legislature;
293          (i) schedule AO includes employees of the judiciary;
294          (j) schedule AP includes all judges in the judiciary;
295          (k) schedule AQ includes:
296          (i) members of state and local boards and councils appointed by the governor and
297     governing bodies of agencies;
298          (ii) a water commissioner appointed under Section 73-5-1;
299          (iii) other local officials serving in an ex officio capacity; and
300          (iv) officers, faculty, and other employees of state universities and other state
301     institutions of higher education;
302          (l) schedule AR includes employees in positions that involve responsibility:
303          (i) for determining policy;
304          (ii) for determining the way in which a policy is carried out; or

305          (iii) of a type not appropriate for career service, as determined by the agency head with
306     the concurrence of the director;
307          (m) schedule AS includes any other employee:
308          (i) whose appointment is required by statute to be career service exempt;
309          (ii) whose agency is not subject to this chapter; or
310          (iii) whose agency has authority to make rules regarding the performance,
311     compensation, and bonuses for its employees;
312          (n) schedule AT includes employees of the Division of Technology Services,
313     designated as executive/professional positions by the director of the Division of Technology
314     Services with the concurrence of the director of the division;
315          (o) schedule AU includes patients and inmates employed in state institutions;
316          (p) employees of the Department of Workforce Services, designated as schedule AW:
317          (i) who are temporary employees that are federally funded and are required to work
318     under federally qualified merit principles as certified by the director; or
319          (ii) for whom substantially all of their work is repetitive, measurable, or transaction
320     based, and who voluntarily apply for and are accepted by the Department of Workforce
321     Services to work in a pay for performance program designed by the Department of Workforce
322     Services with the concurrence of the director of the division;
323          (q) subject to Subsection (6), schedule AX includes employees in positions that:
324          (i) require the regular supervision and performance evaluation of one or more other
325     employees; and
326          (ii) are not designated exempt from career service under any other schedule described
327     in this Subsection (1); [and]
328          [(r) for employees in positions that are temporary, seasonal, time limited, funding
329     limited, or variable hour in nature, under schedule codes and parameters established by the
330     division by administrative rule.]
331          (r) subject to Subsection (7), schedule AY includes an employee, except an employee
332     in a position subject to Subsection (3)(d), who is in a position that is not designated under any
333     other schedule described in this Subsection (1) as exempt from career service; and
334          (s) an employee in a position that is temporary, seasonal, time-limited, funding-limited,
335     or with variable hours, under schedule codes and parameters established by the division by

336     rule.
337          (2) The civil service shall consist of two schedules as follows:
338          (a) (i) Schedule A is the schedule consisting of positions under Subsection (1).
339          (ii) Removal from any appointive position under schedule A, unless otherwise
340     regulated by statute, is at the pleasure of the appointing officers without regard to tenure.
341          (b) Schedule B is the competitive career service schedule, consisting of:
342          (i) all positions filled through competitive selection procedures as defined by the
343     director; or
344          (ii) positions filled through a division approved on-the-job examination intended to
345     appoint a qualified person with a disability, or a veteran in accordance with Title 71, Chapter
346     10, Veterans Preference.
347          (3) (a) The director, after consultation with the heads of concerned executive branch
348     departments and agencies and with the approval of the governor, shall allocate positions to the
349     appropriate schedules under this section.
350          (b) Agency heads shall make requests and obtain approval from the director before
351     changing the schedule assignment and tenure rights of any position.
352          (c) Unless the director's decision is reversed by the governor, when the director denies
353     an agency's request, the director's decision is final.
354          (d) (i) An agency may file with the division a request to reschedule a position that
355     would otherwise be scheduled as a schedule A position.
356          (ii) The division shall review a request filed under Subsection (3)(d)(i) and approve the
357     request only if the exception is necessary to conform to a requirement imposed as a condition
358     precedent to receipt of federal funds or grant of a tax benefit under federal law.
359          (4) (a) Compensation for employees of the Legislature shall be established by the
360     directors of the legislative offices in accordance with Section 36-12-7.
361          (b) Compensation for employees of the judiciary shall be established by the state court
362     administrator in accordance with Section 78A-2-107.
363          (c) Compensation for officers, faculty, and other employees of state universities and
364     institutions of higher education shall be established as provided in Title 53B, Chapter 1,
365     Governance, Powers, Rights, and Responsibilities, and Title 53B, Chapter 2, Institutions of
366     Higher Education.

367          (d) Unless otherwise provided by law, compensation for all other schedule A
368     employees shall be established by their appointing authorities[, within ranges approved by,
369     and]:
370          (i) after consultation with the director[.];
371          (ii) using ranges approved by the director; and
372          (iii) at or above the minimum salary of the salary range for the employee's position.
373          (5) An employee who is in a position designated schedule AC and who holds career
374     service status on June 30, 2010, shall retain the career service status if the employee:
375          (a) remains in the position that the employee is in on June 30, 2010; and
376          (b) does not elect to convert to career service exempt status in accordance with a rule
377     made by the division.
378          (6) (a) An employee who is hired for a schedule AX position on or after July 1, 2022,
379     is exempt from career service status.
380          (b) An employee who before July 1, 2022, is a career service employee employed in a
381     schedule B position that is rescheduled to a schedule AX position on July 1, 2022, [shall
382     maintain] maintains the employee's career service status for the duration of the employee's
383     employment in the same position unless the employee voluntarily converts to career service
384     exempt status before July 1, 2023.
385          (c) (i) Subject to Subsection (6)(c)(ii), an employee is exempt from career service
386     status if:
387          (A) before July 1, 2022, the employee was a probationary employee in a schedule B
388     position and had not completed the probationary period; and
389          (B) on July 1, 2022, the schedule B position in which the probationary employee is
390     employed is rescheduled as a [scheduled] schedule AX position.
391          (ii) An employee described in Subsection (6)(c)(i):
392          (A) is not a probationary employee on or after July 1, 2022; and
393          (B) is exempt from career service status on and after July 1, 2022, unless the employee
394     changes employment to a schedule B position.
395          (d) The division shall disseminate to each employee described in Subsection (6)(b)
396     information on financial and other incentives for voluntary conversion to career-service exempt
397     status.

398          (e) An agency, as defined in Section 63A-17-112, may adopt a policy, created in
399     consultation with the division, for agency review of recommendations that schedule AX
400     employees be suspended, demoted, or dismissed from employment.
401          (7) (a) An employee hired for a schedule AY position on or after July 1, 2023 is
402     exempt from career service.
403          (b) An employee who, before July 1, 2023, is a career service employee in a schedule B
404     position that, on July 1, 2023, is rescheduled to a schedule AY position, maintains the
405     employee's career service status for the duration of the employee's employment in the same
406     position unless the employee voluntarily elects, before March 30, 2024, to convert to a status
407     that is exempt from career service .
408          (c) Subject to Subsection (7) (d), an employee is exempt from career service if the
409     employee:
410          (i) (A) before July 1, 2023, was a probationary employee in a schedule B position; and
411          (B) by July 1, 2023, had not completed the probationary period; and
412          (ii) on July 1, 2023, the schedule B position in which the employee is employed is
413     rescheduled as a schedule AY position.
414          (d) An employee described in Subsection (7)(c)(i):
415          (i) is not a probationary employee on and after July 1, 2023; and
416          (ii) is exempt from career service on and after July 1, 2023, unless the employee
417     changes employment to a schedule B position.
418          (e) The division shall disseminate to each employee described in Subsection (7)(b)
419     information on financial and other incentives for the employee to voluntarily convert to a status
420     that is exempt from career service.
421          Section 5. Section 63A-17-304 is amended to read:
422          63A-17-304. Promotion -- Reclassification -- Market adjustment.
423          (1) [(a)] If an employee is promoted or the employee's position is reclassified to a
424     higher salary range maximum, the agency shall place the employee [within] at or above the
425     minimum salary of the new salary range [of] for the position.
426          [(b) An agency may not set an employee's salary:]
427          [(i) higher than the maximum in the new salary range; or]
428          [(ii) lower than the minimum in the new salary range of the position.]

429          (2) An agency shall adjust the salary range for an employee whose salary range is
430     approved by the Legislature for a market comparability adjustment consistent with Subsection
431     63A-17-307(5)(b)(i):
432          (a) at the beginning of the next fiscal year; and
433          (b) consistent with appropriations made by the Legislature.
434          (3) Division-initiated revisions in the state classification system that result in
435     consolidation or reduction of class titles or broadening of pay ranges:
436          (a) may not be regarded as a reclassification of the position or promotion of the
437     employee; and
438          (b) are exempt from the provisions of Subsection (1).
439          Section 6. Section 63A-17-307 is amended to read:
440          63A-17-307. State pay plans -- Applicability of section -- Exemptions -- Duties of
441     director.
442          (1) (a) This section, and the rules made by the division under this section, apply to each
443     career and noncareer employee not specifically exempted under Subsection (2).
444          (b) If not exempted under Subsection (2), an employee is considered to be in classified
445     service.
446          (2) The following employees are exempt from this section:
447          (a) members of the Legislature and legislative employees;
448          (b) members of the judiciary and judicial employees;
449          (c) elected members of the executive branch and employees designated as schedule AC
450     as provided under Subsection 63A-17-301(1)(c);
451          (d) employees of the State Board of Education;
452          (e) officers, faculty, and other employees of state institutions of higher education;
453          (f) employees in a position that is specified by statute to be exempt from this
454     Subsection (2);
455          (g) employees in the Office of the Attorney General;
456          (h) department heads and other persons appointed by the governor under statute;
457          (i) schedule AS employees as provided under Subsection 63A-17-301(1)(m);
458          (j) department deputy directors, division directors, and other employees designated as
459     schedule AD as provided under Subsection 63A-17-301(1)(d);

460          (k) employees that determine and execute policy designated as schedule AR as
461     provided under Subsection 63A-17-301(1)(l);
462          (l) teaching staff, educational interpreters, and educators designated as schedule AH as
463     provided under Subsection 63A-17-301(1)(g);
464          (m) temporary employees described in Subsection 63A-17-301(1)(r);
465          (n) patients and inmates designated as schedule AU as provided under Subsection
466     63A-17-301(1)(o) who are employed by state institutions; and
467          (o) members of state and local boards and councils and other employees designated as
468     schedule AQ as provided under Subsection 63A-17-301(1)(k).
469          (3) (a) The director shall prepare, maintain, and revise a position classification plan for
470     each employee position not exempted under Subsection (2) to provide equal pay for equal
471     work.
472          (b) Classification of positions shall be based upon similarity of duties performed and
473     responsibilities assumed, so that the same job requirements and the same salary range, subject
474     to Section 63A-17-112, may be applied equitably to each position in the same class.
475          (c) The director shall allocate or reallocate the position of each employee in classified
476     service to one of the classes in the classification plan.
477          (d) (i) The division shall conduct periodic studies and interviews to provide that the
478     classification plan remains reasonably current and reflects the duties and responsibilities
479     assigned to and performed by employees.
480          (ii) The director shall determine the need for studies and interviews after considering
481     factors such as changes in duties and responsibilities of positions or agency reorganizations.
482          (4) (a) With the approval of the executive director and the governor, the director shall
483     develop and adopt pay plans for each position in classified service.
484          (b) The director shall design each pay plan to achieve, to the degree that funds permit,
485     comparability of state salary ranges to the market using data obtained from private enterprise
486     and other public employment for similar work.
487          (c) The director shall adhere to the following in developing each pay plan:
488          (i) each pay plan shall consist of sufficient salary ranges to:
489          (A) permit adequate salary differential among the various classes of positions in the
490     classification plan; and

491          (B) reflect the normal growth and productivity potential of employees in that class.
492          (ii) The director shall issue rules for the administration of pay plans.
493          (d) The establishing of a salary range is a nondelegable activity and is not appealable
494     under the grievance procedures of Part 6, Grievance Provisions, Title 67, Chapter 19a,
495     Grievance Procedures, or otherwise.
496          (e) The director shall make rules, accordance with Title 63G, Chapter 3, Utah
497     Administrative Rulemaking Act, providing for:
498          (i) agency approved salary adjustments [within approved salary ranges], including an
499     administrative salary adjustment; and
500          (ii) structure adjustments that modify salary ranges, including a cost of living
501     adjustment or market comparability adjustment.
502          (5) (a) On or before October 31 of each year, the director shall submit an annual
503     compensation plan to the executive director and the governor for consideration in the executive
504     budget.
505          (b) The plan described in Subsection (5)(a) may include recommendations, including:
506          (i) salary increases that generally affect employees, including a general increase or
507     merit increase;
508          (ii) salary increases that address compensation issues unique to an agency or
509     occupation;
510          (iii) structure adjustments, including a cost of living adjustment or market
511     comparability adjustment; or
512          (iv) changes to employee benefits.
513          (c) (i) (A) Subject to Subsection (5)(c)(i)(B) or (C), the director shall incorporate the
514     results of a salary survey of a reasonable cross section of comparable positions in private and
515     public employment in the state into the annual compensation plan.
516          (B) The salary survey for a law enforcement officer, as defined in Section 53-13-103, a
517     correctional officer, as defined in Section 53-13-104, or a dispatcher, as defined in Section
518     53-6-102, shall at minimum include the three largest political subdivisions in the state that
519     employ, respectively, comparable positions.
520          (C) The salary survey for an examiner or supervisor described in Title 7, Chapter 1,
521     Part 2, Department of Financial Institutions, shall at minimum include the Federal Deposit

522     Insurance Corporation, Federal Reserve, and National Credit Union Administration.
523          (ii) The director may cooperate with or participate in any survey conducted by other
524     public and private employers.
525          (iii) The director shall obtain information for the purpose of constructing the survey
526     from the Division of Workforce Information and Payment Services and shall include employer
527     name, number of persons employed by the employer, employer contact information and job
528     titles, county code, and salary if available.
529          (iv) The division shall acquire and protect the needed records in compliance with the
530     provisions of Section 35A-4-312.
531          (d) The director may incorporate any other relevant information in the plan described
532     in Subsection (5)(a), including information on staff turnover, recruitment data, or external
533     market trends.
534          (e) The director shall:
535          (i) establish criteria to assure the adequacy and accuracy of data used to make
536     recommendations described in this Subsection (5); and
537          (ii) when preparing recommendations use accepted methodologies and techniques
538     similar to and consistent with those used in the private sector.
539          (f) (i) Upon request and subject to Subsection (5)(f)(ii), the division shall make
540     available foundational information used by the division or director in the drafting of a plan
541     described in Subsection (5)(a), including:
542          (A) demographic and labor market information;
543          (B) information on employee turnover;
544          (C) salary information;
545          (D) information on recruitment; and
546          (E) geographic data.
547          (ii) The division may not provide under Subsection (5)(f)(i) information or other data
548     that is proprietary or otherwise protected under the terms of a contract or by law.
549          (g) The governor shall:
550          (i) consider salary and structure adjustments recommended under Subsection (5)(b) in
551     preparing the executive budget and shall recommend the method of distributing the
552     adjustments;

553          (ii) submit compensation recommendations to the Legislature; and
554          (iii) support the recommendation with schedules indicating the cost to individual
555     departments and the source of funds.
556          (h) If funding is approved by the Legislature in a general appropriations act, the
557     adjustments take effect on the July 1 following the enactment unless otherwise indicated.
558          (6) (a) The director shall make rules, in accordance with Title 63G, Chapter 3, Utah
559     Administrative Rulemaking Act, for the granting of incentive awards, including awards for cost
560     saving actions, awards for commendable actions by an employee, or a market-based award to
561     attract or retain employees.
562          (b) An agency may not grant a market-based award unless the award is previously
563     approved by the division.
564          (c) In accordance with Subsection (6)(b), an agency requesting the division's approval
565     of a market-based award shall submit a request and documentation, subject to Subsection
566     (6)(d), to the division.
567          (d) In the documentation required in Subsection (6)(c), the requesting agency shall
568     identify for the division:
569          (i) any benefit the market-based award would provide for the agency, including:
570          (A) budgetary advantages; or
571          (B) recruitment advantages;
572          (ii) a mission critical need to attract or retain unique or hard to find skills in the market;
573     or
574          (iii) any other advantage the agency would gain through the utilization of a
575     market-based award.
576          (7) (a) The director shall regularly evaluate the total compensation program of state
577     employees in the classified service.
578          (b) The division shall determine if employee benefits are comparable to those offered
579     by other private and public employers using information from:
580          (i) a study conducted by a third-party consultant; or
581          (ii) the most recent edition of a nationally recognized benefits survey.
582          Section 7. Effective date.
583          (1) Except as provided in Subsection (2), this bill takes effect May 3, 2023.

584          (2) The amendments to Sections 63A-17-106 and 63A-17-112 take effect July 1, 2023.