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Comparing compensation.

COMPARING COMPENSATION

How do you know at what level to compensate your employees? Did merit increases in your association match the national average last year? Does your association's fringe benefits package stack up against those for similar organizations? Having this kind of information can be critical when it's time to recommend a package of benefits to your board. Obviously, that's when you need more than hearsay to support your decisions. ASAE's Association Executive Compensation Study, Seventh Edition is the place to find the answers. Use it to make comparisons with your colleagues and with associations like yours.

Overview

The Association Executive Compensation Study reports on a survey ASAE conducts every two years. The survey is mailed to a representative sample of ASAE membership from across the United States. In 1990 more than 2,100 association executives responded. Their answers provided detailed information on compensation in key positions as well as fringe benefits and a range of personnel practices.

The report provides extensive compensation data for the chief executive, deputy executive, and 25 other top management positions in both trade associations and individual membership organizations. A total of 8,352 positions are portrayed in the latest study, broken out by association type, scope, income, and geographic location.

Many factors go into the determination of salary and benefits. Elements to consider include past levels of compensation at your association and levels of compensation in the industry or profession you represent. However, in assessing your offerings, it is helpful to have a point of reference and a view of the big picture. That is what makes these statistics valuable. Not that they are a mandate, but they do provide you with tools to make better decisions.

Table 1 summarizes total compensation trends for all survey participants and highlights changes since the last edition of the study. (Note: Although ASAE uses the same sampling method in every survey, the actual sample from survey to survey may vary substantially.) [Tabular Data Omitted]

Special benefits

In addition to the more commonly offered fringe benefits, such as life, health, and disability insurance, this study examines a host of other perquisites. Benefits pertaining to professional development top this year's list of offerings (see Table 2). More than a third of the associations surveyed reimburse their management staff for educational expenses. Thirty-seven percent of the associations pay for professional memberships as well. The percentages for these professional benefits are even higher - 44 percent and 46 percent, respectively - in international/national associations. Other top benefits, offered by nearly one quarter of associations, are business cars or allowances and professional liability insurance.

Those surveyed report receiving additional benefits, including club memberships, spouse travel reimbursement, and financial planning services. On the average, associations report allocating 19 percent of salaries to fringe benefits. [Tabular Data Omitted.]

Retirement benefits

Almost three quarters of the responding associations offer at least one International Revenue Service-qualified retirement plan (see Table 3). Of these associations, 63 percent offer a defined benefit-defined contribution plan. Eleven percent offer an individual retirement account, 16 percent offer a tax-sheltered annuity, and 17 percent offer a 401(k) plan. In 55 percent of the 401(k) plans, employers match salary deferrals, and 21 percent of employers make additional, discretionary contributions to the plans.

The study also explores issues related to employee participation in retirement plans. The most common minimum age for participating in a retirement plan is 21. Almost a third of the plans offer immediate vesting. Another 26 percent of the plans offer 100 percent vesting after five years of participation. Sixty-one percent of the plans set 65 as the normal retirement age, and 21 percent allow for early retirement at age 55.

Executive contracts

Although employment contracts for staff specialists are rare, they have become commonplace for chief paid executives (see Table 4). Only 13 percent of all associations surveyed report having no contract for their chief executive. More than half the chief executives are retained by formal, written agreements. The most usual term of contract is three to four years for chief executives and one year for deputy executives.

For both chief executives and deputy executives, the length of termination notice is typically three months. Forty-four percent of chief executives report having a severance pay clause in their contracts, as do 22 percent of deputy executives. Severance pay is based on "salary for a set period" for more than half the chief executives and deputy executives surveyed in this edition.

Compensation by gender

Although the published survey report contains no data comparing compensation by gender, ASAE collects this information for analytic purposes. The results of the 1990 study do not offer any evidence of marked improvement in the ratio of women's salaries to men's salaries since the last comparison in 1988. For example, female chief executives still earn only an average of 55 percent of what their male counterparts earn. The gap between male and female earnings remains wide in most association management positions, although there are notable exceptions (see Table 5).

Women's compensation is catching up with men's compensation in the position of chapter relations director. In trade associations, female chapter relations directors earn 88 percent of their male counterparts' earnings (up from 84 percent in 1988), and in individual membership organizations they now earn 92 percent of their male counterparts' earnings (up from 82 percent in 1988). Female foundation directors in trade associations new earn 97 percent of their male counterparts' earnings (up from 74 percent in 1988). Female Washington, D.C., office heads in individual membership organizations have narrowed the margin to 95 percent (up from 80 percent in 1988).

Director of consumer affairs is the only position in which there is near salary parity. In trade associations, female consumer affairs directors earn only 1 percent less than their male counterparts. In individual membership organizations, female consumer affairs directors now earn an average of 3 percent more than their male counterparts. For more observations on the compensation gender gap and closing that gap, consult Association Management's "Compensation: The Gender Gap Continues" (January 1989).

Laurel Viguera is ASAE's associate manager of research and information.
COPYRIGHT 1991 American Society of Association Executives
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1991, Gale Group. All rights reserved. Gale Group is a Thomson Corporation Company.

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Title Annotation:study on salaries and benefits of various associations
Author:Viguera, Laurel
Publication:Association Management
Date:May 1, 1991
Words:1016
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