As merit season begins, we know many staff have questions about how performance connects to pay.
In our roles within Human Resources (HR), we partner closely with leaders and managers across the university to provide guidance on compensation and performance practices. Each year, we see firsthand how merit decisions are shaped by Rice’s values, fiscal environment and our ongoing commitment to fair, consistent and market-aligned pay practices.
Rice's Compensation Overview
Rice’s approach to compensation begins with a commitment to competitive pay. Through the Total Rewards Initiative, the university is investing $20 million over four years to strengthen staff salaries and benefits (FY25 marked year one). This effort followed a comprehensive market study comparing Rice to peer institutions and major employers in Houston and across the country.
These investments reinforce Rice’s commitment to attracting and retaining top talent by prioritizing salary adjustments that support market alignment, particularly for employees whose pay falls below their assigned pay grade. For fiscal year 2027, additional investments will raise the base pay for hourly employees to $18 per hour, reinforcing leadership’s commitment to competitive pay and a comprehensive total rewards strategy.
Determining the Merit Pool
The merit pool is established each year to balance institutional priorities, financial stewardship and Rice’s commitment to attracting and retaining talent. Performance outcomes may influence merit increases, one-time payments or bonuses, depending on individual circumstances. However, available funding ultimately determines the size of the overall merit pool (the FY27 merit pool is set at 2%).
Annual increases, bonuses and promotions are administered through the Employee Merit Cycle (EMC) Workbook in iO, which ensures alignment with both performance and market competitiveness.
How Performance is Assessed
Performance is evaluated through Rice’s annual performance management process, also managed through iO. The process emphasizes clear goal-setting, ongoing feedback and an overall assessment of results.
Managers and employees are encouraged to engage in regular check-ins throughout the year, not just during the annual review period. These conversations help clarify expectations, track progress and address challenges early. Final performance ratings reflect both individual outcomes and alignment with organizational goals. When performance conversations are consistent and well documented, merit decisions are more transparent, fair and equitable.
Understanding the Merit Time Cycle
While exact dates shift slightly from year to year, the merit process generally follows a consistent sequence:
- Late January: Budget guidance is shared and performance evaluations start
- Early February: EMC Workbook opens for initial merit inputs into iO
- Late February: EMC Workbook closes
- Mid March: Performance evaluations close
- Mid April: EMC Workbook reopens to allow adjustments after performance ratings are finalized
- Late May: Staff salary letters are issued
- Early July: Approved merit increases take effect
This phased approach ensures that performance outcomes are incorporated thoughtfully before final pay decisions are made.
(For specific dates related to the FY27 budget cycle, view the Budget Calendar.)
Setting Clear Expectations and Finding Support
Clear expectations are the foundation of meaningful performance conversations and fair merit decisions. Employees and managers should discuss goals, priorities and success measures at the start of the year, and revisit them throughout the performance cycle. This ensures alignment with departmental and organizational objectives and provides a strong basis for merit considerations.
Employees are encouraged to proactively seek feedback, clarify expectations and leverage available resources to support their performance and development. Maintaining clear documentation of accomplishments, challenges and progress helps ensure performance outcomes are recognized accurately and that merit decisions are transparent, consistent and equitable.
The Compensation and Organizational & Talent Development teams are available to provide guidance throughout the year. HR open houses and office hours are available throughout the cycle to support both employees and managers.
Resources
- Compensation questions: compensation@rice.edu
- Compensation overview: https://knowledgecafe.rice.edu/compensation-overview
- Performance management support: otd@rice.edu
Understanding how performance and pay connect helps set clear expectations, not just during merit season, but year-round.