The UC Board of Regents convened to review the University of California’s compensation policies, which have been under fire since November due to public salary transparency problems, but declined to admit wrongdoing until a university-led audit was finished.

The meeting, held at Price Center on Jan. 18, was described by several regents as a “very serious” matter, and the board heard the first presentation from the newly created special committee on compensation, chaired by Regent Judith Hopkinson, regarding proposed changes of the university’s pay policies.

Hopkinson said that as soon as an audit of executive salaries is complete, the university could “expect a fairly major overhaul of [its] compensation practices.”

“The current policies are difficult, unclear, divergent and unorganized,” Hopkinson said.

The university has selected a private company to conduct a three-phase audit into its pay methods over the past 10 years and to review compensation of the top 32 executive positions in the university, including chancellors and senior vice presidents.

The university has been scrutinized recently following reports published by the San Francisco Chronicle revealing that it awarded $871 million last year to top executives in addition to their base pay and overtime, which has prompted the state Legislature to request a separate, independent audit.

Gerald L. Parsky, chair of the Board of Regents, said the university would fully cooperate with any state audit into its compensation practices.

“We welcome this,” Parsky said. “We’re not paying lip service to this area.”

The committee report revealed that the university-commissioned audit would take at least six months to be full and accurate.

Phase one of the audit will entail an assessment of university payroll and personnel records, and, Hopkinson said, “a significant amount should be accomplished by the end of January.”

Phases two and three will examine the compensation of the previous occupants of the top 32 executive offices and the reimbursement of various expenses, such as travel costs.

In addition to hearing the special report, the regents voted to amend the current compensation policy in favor of a new method that establishes broad salary levels into which top employees would be placed by UC President Robert C. Dynes. The salary structure will be reviewed annually and adjusted by the regents. Assignments to particular tiers would be based on several factors, including national salary averages for similar positions, employee qualifications and performance. The top range would be capped at $791,600.

Currently, the board must approve annual salaries exceeding $168,000.

The new method would make compensation policies more “clear, comprehensive and accountable,” Parsky said.

However, under the new method, the regents would need to approve yearly salary increases greater than 15 percent.

Readers can contact Matt McArdle at [email protected].