Compensation for Student Employment Positions
Effective January 11, 2021, the lowest paid wage (LPW) for student employees will be $12.15 per hour. Though NAU is only required to follow the federal minimum wage of $7.25, a higher starting rate (State of Arizona minimum wage) better balances the economic needs of our student employees, while preserving the number of student jobs we can offer.
Pay ranges by classification level
To ensure equitable compensation for student employees, the following pay ranges have been established for classification levels, effective January 11, 2021:
Level 1 & 2: $12.15
Level 3: $12.15-12.99
Level 4*: $13.00 +
Note: Any minimum wage changes will occur automatically; departments do not need to submit ePARs for these changes to go into effect. Please contact Human Resources with questions.
*Note for hiring supervisors: Student employees hired at or above $15.00 per hour require VP or Dean and Provost approval.
Guidelines for pay rate increases
- Increases should follow the guidelines for classification levels and pay ranges. (i.e. pay rate increases should not exceed the range for that position’s classification)
- Student employees should be in their roles a minimum of one semester before any compensation increases occur.
- Departments should not increase an individual student’s compensation more than once per academic year, absent a role change.
- Increases should factor in the student employee’s performance, with the requirement that students performing at or above expected proficiency levels for their role would be eligible for an increase, if department budgets allow.
- Increase structure should be equitable within departments, based on meeting or exceeding expected proficiency levels or a job change that places someone at a new level.
- Departments should be mindful of organizational climate and impact, both positive and negative, on employee morale when implementing increases. (e.g. were benefit eligible staff given increases that year)
FICA-adjusted NAU student wage
Per the IRS, NAU student employees enrolled at least half time do not personally pay Federal Insurance Contributions Act (FICA) taxes of 7.65% (Social Security tax of 6.2% plus Medicare tax of 1.45%). (FICA taxes are paid by the student if at any time they drop below half time enrollment requirement or during periods of time, such as summer, when they are not attending classes).
Steer clear of stipends
Stipends do not provide the appropriate structure to ensure compliance with the Fair Labor Standards Act (FLSA). In order to ensure that NAU complies with FLSA requirements, most student employees report their hours by clocking in and out via PeopleSoft Time & Labor and are paid for each hour reported.
Does my student employment position qualify for the “RA Exemption” from the FLSA? Accordion Closed
In summary, in order to qualify for this exemption (which will allow the person to be paid by salary, rather than hourly) the following must be in place:
- The person doing the work must be a student. This means you cannot hire graduating seniors, or non-students into these positions.
- The work must be tied to an educational program. The work performed must be tied to the instruction and guidance of the participants in the program. The program should not be one where NAU’s primary interest is in generating income.
- There must be a justified need for the person in the job to live in the residence hall (or other location) with the participants in the program.