Compensation includes:

• Salaries
• Wages
• Incentive awards
• Fringe benefits
• Pension plan costs
• Incentive pay

Comparability of Wages

• Pay at least minimum wage
• Base salary scales on training and experience
• Wages cannot be higher than those paid to individuals in area or in the area where previously employed, whichever is higher
• Based on up-to-date or updated survey
• Data primarily reflect service area or similar area
• Data from primarily non-profit/public human service organizations
• Considers agency type, scope, size, budget , qualifications

Cost of Living Allowances (COLA)

• Distribute as required
• Retroactive increases (if a raise in year was equal to or greater than COLA, no retroactive required)
• No COLA if it would increase salary above prevailing wage in service area
• Payment to separated employees (grantee written personnel policy)

Fringe Benefits

• Leave
  1. Leave policies, in general
  2. Policy on carryover from year to year
  3. Funding accrued leave
     
• Incentive pay and awards
  1. Reasonable
  2. Paid pursuant to an agreement prior to services rendered
  3. Pursuant to an established plan followed so consistently as to imply an agreement to make such payments

Source: Head Start Act - Sections 640 & 653, OMB Circulars A-87 & A-122 Employee Compensation