FC 108/11 b)|
Hundred and eighth Session
27 September – 1 October 2004
Cost Analysis of Staff Remuneration and Benefits
1. The purpose of this paper is to respond to the Committee’s request at its 107th session1/ for details on the financial aspects of staff emoluments including, in addition to salaries, all the other benefits. The document provides descriptions of the various elements of remuneration and benefits and a summary table of the related actual costs for the Regular Programme.
2. The Committee took note of the information provided in document FC 108/11(b) regarding the costs of staff remuneration and benefits.
3. At its 107th session, in the context of its discussion of document FC 107/14, Adjustments to the Programme of Work and Budget 2004-05, the Finance Committee requested that details on the financial aspects of staff emoluments including, in addition to salaries, all the other benefits be submitted for review at its next session. This document responds to this request.
4. Following is a description of the various benefits and allowances granted, in addition to salaries, to internationally and locally recruited staff. Most of these benefits and allowances are those provided within the UN common system and have been reviewed by the International Civil Service Commission (ICSC) and approved by the UN General Assembly. A few of them are granted to the staff in the general service category to reflect the local prevailing conditions of service in accordance with the methodology approved by the ICSC (Flemming Principle).
5. The 2002-2003 actual cost of each item for the Regular Programme has been provided in the Table I.
6. The remuneration of staff in the professional and higher categories consists of two main elements: the base/floor salary and the post adjustment, both expressed in US dollars.
7. The salaries for professional staff are set by reference to the highest-paying national civil service (the Noblemaire principle), as determined by the International Civil Service Commission. The federal civil service of the United States of America has to date been taken as the highest paid national civil service.
8. The post adjustment system is designed to ensure that professional salaries have the same purchasing power at all duty stations. As the cost-of-living varies between duty stations, the post adjustment added to professional salaries is set at different levels to compensate for differences in living costs. Post adjustment classifications specify the number of multiplier points of post adjustment to be paid in addition to the net base salary at any duty station. One multiplier point is equal to 1 per cent of the net base salary.
9. Dependency benefits are provided in the form of higher net salaries and allowances for staff with dependants (dependency or "D" rate) than for those without dependants (single or "S" rate) and by flat-rate allowances for children and secondary dependants. A staff member receiving the higher dependency rate salary will consequently also receive a higher post adjustment, mobility and hardship allowance, assignment grant and separations payments. There is no dependent spouse allowance for professional staff.
10. Child allowances are available to eligible staff in the form of a flat amount. To qualify as a dependant, a child must be under the age 18, or, if in full-time attendance at a school or university, be under 21 years of age. Professional staff who have dependent children but no dependent spouse, qualify for the dependency rate of net salary and allowances in respect of the first dependent child. In that case, the allowance is not paid for the first child. The allowance for a disabled child is twice the usual amount.
11. Where there is no recognized primary dependant, a secondary dependant’s allowance may be payable for a dependent parent, brother or sister, for whom the staff member provides at least one-third of the dependant’s total income. A staff member may not concurrently receive more than one secondary dependant’s allowance.
12. A rental subsidy may be paid when a staff member’s rent exceeds a so-called threshold rental. At field duty stations the rental subsidy is 80 per cent of the excess of the staff member’s actual rent over the threshold amount. At headquarters duty stations, the subsidy is payable to newcomers only and starts at 80 per cent of the difference for the first four years, and is reduced to 60 per cent, 40 per cent and 20 per cent for the next three years, after which it is discontinued. The maximum subsidy payable is 40 per cent of the rent.
13. An education grant is available to internationally-recruited staff members serving outside their home country. The grant is payable up to the end of the fourth year of post-secondary studies or the award of a recognized first level degree, subject to a maximum age limit of 25 years. The amount of the grant is equivalent to 75 per cent of certain allowable costs, subject to the maximum established amounts. For disabled children the grant is equivalent to 100 per cent of allowable costs.
14. Staff members may be assigned for a substantial period of time to perform the full range of duties and responsibilities of a higher level post. Such staff may be granted a “special post allowance” which is equal to the difference between the current pay of the staff member and that which would be applicable on promotion to the higher grade. This allowance is temporary and non-pensionable.
15. This allowance is established for the Director-General by the Conference and is established by the Council for staff members at the Deputy Director-General and Assistant Director-General levels.
16. The evacuation allowance is granted to eligible staff who are evacuated from the duty station of assignment due to emergency situations as recognized and declared by the United Nations Security Coordinator.
17. Staff members assigned to field duty stations may be eligible for reimbursement of security costs (e.g. security bars or residential guards) due to the inherent security situation in the country.
18. This includes other entitlements of a special and/or temporary nature due to specific local conditions, such as hazard pay.
19. An assignment grant is paid to a staff member travelling at the Organization’s expense on recruitment or transfer/reassignment for a period of service expected to be of at least one year. The assignment grant consists of a daily subsistence allowance (DSA) portion (30 days’ DSA) and a lump sum portion (consisting of one or two months of net remuneration depending on the duration of the assignment and the classification of the assigned duty station).
20. The mobility and hardship allowance is designed to encourage mobility between duty stations and to compensate for service at difficult locations. The allowance is not pensionable and is based on net salary at P-4, step VI (D). The amount of this allowance is calculated according to a matrix which combines the classification of the assigned duty station (by level of difficulty in terms of living conditions) and number of assignments of the staff member concerned.
21. This includes authorized travel expenses of a staff member, including the travel expenses of eligible family members (spouse and dependent children), on: initial appointment; change of duty station; home leave or separation from service (e.g. removal and shipment costs). Also included are expenses incurred by the staff member on family visit travel and by a dependent child on education grant travel.
22. A Basic Medical Insurance Plan (BMIP) is provided by the Organization. The plan coverage is compulsory for all staff members wherever located, who hold a fixed-term or a continuing appointment. The coverage is extended to dependent family members as well. The contributions to the plan are shared equally between the staff member and the Organization, except that where the monthly contribution would represent more than 5% of the staff member gross salary. The amount actually charged to the staff member shall be 5% of gross salary, and the Organization’s share is increased accordingly.
23. The scheme applies to retired staff members and their family members provided that they have been participating in BMIP at the time of the staff member’s separation and have been participants in BMIP for at least 10 years. Contributions are shared equally between the Organization and the participant, whose contribution, however, should not exceed 4% of the full benefit from the United Nations Joint Staff Pension Fund.
24. The United Nations Joint Pension Fund (UNJSPF) provides retirement, disability and survivors’ benefits for the staff of organizations that are members of the Fund. The current rate of contributions to the Fund is 23.7 % of pensionable remuneration, with two thirds paid by the Organization and one third by the staff member.
25. A Compensation Plan Reserve Fund is established to cover compensation for death, injury or illness attributable to the performance of official duties. The fund is fully maintained by the Organization.
26. A repatriation grant is payable on separation to internationally recruited staff in respect of the period of services outside their home country. The amount of the grant is calculated by reference to the net salary of the staff member concerned, the length of service and the family status.
27. A termination indemnity is paid to a staff member whose appointment has been terminated by the Organization for abolition of post or reduction of staff; poor health or incapacitation for further service; unsatisfactory service and agreed termination.
28. If staff members have annual leave that they have not been able to use for reasons of service, it may be converted into a cash amount at the moment of separation. The maximum amount of leave that may be commuted in this way is 60 days.
29. The salary of staff in the general service category is established with reference to the best prevailing local conditions (the Flemming principle) through a comprehensive salary survey that is conducted locally by the International Civil Service Commission (ICSC) with regard to headquarters duty stations, and by the leading UN agency with regard to other duty stations. Normally the salary scales are expressed and paid in local currency.
30. A child allowance is provided as a social benefit and is paid as a flat amount equivalent to 2.5 per cent of the mid-point of the local salary scale. The allowance may be paid for up to a maximum of six children. The benefit for a disabled child is twice the normal amount.
31. An allowance for a dependent spouse is paid in accordance with the local practice. A dependent spouse is a spouse whose occupational earning does not exceed the gross salary of the general service salary scale applicable to the G-1 step I.
32. A secondary dependent allowance is paid in accordance with local conditions to a recognized secondary dependent (father, mother, brother or sister).
33. A language allowance is paid to general service staff who are proficient in two official languages and who have passed a language proficiency examination. The language allowance is pensionable and is established at a flat rate for each duty station. An allowance is also payable for a third language and is half that amount, also pensionable.
34. A non-pensionable differential is paid to staff who are assigned to work at night from 20:00 to 06:00 hours. The night differential at Headquarters is calculated at 30% of the hourly rate at step VII of the grade for staff members holding G-1 through G-6 grades and at step VI for staff holding the G-7 grade. At duty stations other than Headquarters, it is calculated on the basis of the practice observed by UN organizations at the duty station.
35. The service differential is paid to staff who are assigned to regularly-scheduled tours of duty exceeding the total hours of work of the established work week. The service differential is pensionable. No differential is payable for work for which overtime payment is made.
36. Staff members may be assigned for a substantial period of time to perform the full range of duties and responsibilities of a higher level post. Such staff may be granted a “special post allowance” which is equal to the difference between the current pay of the staff member and that which would be applicable on promotion to the higher grade. This allowance is temporary and non-pensionable.
37. In accordance with a decision adopted by the FAO Council at its Sixty-Fourth Session, this allowance is paid to those staff members in the general service category who were recognized as a non-local staff member as at 31 January 1975. There are now only 26 such staff members as at that time the Council decided that henceforth all general service staff members would be considered as locally recruited. The non-resident allowance is pensionable.
38. An education grant is available to those general service staff who were recognized as a non-local staff member (see para. 37 above). The grant is payable up to the end of the fourth year of post-secondary studies or the award of a recognized first level degree, subject to a maximum age limit of 25 years. The amount of the grant is equivalent to 75 per cent of allowable costs, subject to the maximum established amounts. For disabled children the grant is equivalent to 100 per cent of allowable costs.
39. This includes other entitlements of a special and/or temporary nature, due to specific local conditions, such as hazard pay and salary bonus. These payments are decided at common system level and normally are not pensionable.
40. It includes authorized travel expenses of a non-local staff member (see para. 37) including the travel expenses of eligible family members (spouse and dependent children) on: home leave or separation from service (e.g. removal and shipment costs). Expenses incurred by a dependent child on education grant travel are also included.
41. These benefits are provided by the Organization to staff in the general service category under the same conditions as for professional staff (see paras 22-25 above).
42. These benefits are provided by the Organization to staff in the general service category under the same conditions as for professional staff (see paras 27 - 28 above).
43. This payment is available to general service staff members who were recognized as a non-local staff member (see para. 37 above) on the same basis as for professional staff.
44. Within the UN common system, the terms and conditions of staff in the general service category are established to reflect the best prevailing local employment conditions (the Flemming principle). In conformity with this principle, FAO has for many years reflected the separation payment scheme that Italian labour legislation requires local employers to provide.
45. Prior to 1975, the value of such schemes was quantified and included as an element in the determination of the base salary. Effective 1 January 1975 FAO decided to replicate the outside practice within the Organization and established the separation payments scheme. At that time a non-pensionable amount corresponding to one month’s salary (8.33%) was separated from base salary and set aside under the Separation Payment Scheme. In January 1991, the monthly percentage was revised to 7.41% to reflect a change in local conditions.
46. As the scheme reflects the practice in Italy, it applies only to staff members in the general service category whose salaries are based on the Headquarters salary scale. Such staff members receive a payment on separation from the Organization for any reason, or on promotion to the professional category. This payment is calculated as net base annual salary in force at the time of separation divided by 13.5 and multiplied by the number of completed years of service rendered between 1 January 1991 and the date of separation. Where applicable, an additional amount is calculated as the net base annual salary in force at the time of separation divided by 12 and multiplied by the number of completed years of service rendered between 1 January 1975 and 31 December 1990.
47. In addition to the above listed benefits and allowances, all staff members are entitled to periods of leave as indicated below. During the leave periods, staff members continue to be paid the same salary, benefits and allowances.
48. Staff members accrue annual leave while in full pay status at the rate of two and one-half working days per month.
49. Sick leave is granted to staff members unable to work due to illness or injury. The duration of sick leave depends on the staff member’s length of service and may be up to a maximum of eighteen months (nine months at full pay, nine months at half pay) in any four consecutive years.
50. Leave with full pay is granted to staff for maternity purposes. Normally it commences six weeks prior to the anticipated date of delivery and extends for a total period of 16 weeks.
Posting Account Description
|Professional and higher categories|
|Base/floor salary and post adjustment|
|Base Salary||176 090 850|
|Post Adjustment||31 133 052|
|Child Allowance||4 224 463|
|Secondary Dependent Allowance||73 812|
|Other benefits and allowances|
|Rental Subsidy||2 291 117|
|Education Grant||15 552 789|
|Special Post Allowance||38 759|
|Representation Allowance||465 209|
|Evacuation Allowance||452 698|
|Security Costs||639 472|
|Other Staff Salary and Allowances||492 228|
|Entitlements relating to travel relocation and mobility of staff|
|Assignment Grant||4 320 481|
|Mobility & Hardship Allowance||5 509 756|
|Other Entitlement Travel||13 551 143|
|Basic Medical Insurance Plan||5 254 527|
|After Service Medical Coverage||6 244 685|
|Pension Plan||49 060 651|
|Compensation Plan||486 570|
|End of Service Payments|
|Repatriation Grant/Termination indemnity/Commutation of accrued annual leave||5 862 311|
|321 744 574|
|General Service Category|
|Base Salary||105 002 211|
|Child Allowance||2 491 944|
|Spouse Allowance||667 509|
|Secondary Dependent Allowance||64 230|
|Other benefits and allowances|
|Language Allowances||2 076 686|
|Night Differential||197 082|
|Service Differential||1 015 055|
|Special Post Allowance||13 952|
|Non-Resident Allowance and Rental Subsidy||10 500|
|Education Grant||425 776|
|Other Staff Salary and Allowances||281 587|
|Entitlement related to travel|
|Entitlement Travel||231 879|
|Basic Medical Insurance Plan||10 135 087|
|After Service Medical Coverage||2 579 196|
|Pension Plan||20 811 953|
|Compensation Plan||207 992|
|End of Service Payments|
|Commutation of Accrued Annual Leave/Termination Indemnity/Repatriation Grant||2 505 273|
|Separation Payment Scheme||4 634 212|
General Service Total
|152 896 102|
|Total Costs||474 620 946|
1 / CL 127/14, para. 67
2 / Entitlements listed under this item, although described separately, are costed through an actuarial evaluation and, therefore, accounted as a total cost in the annexed table.
3 / Entitlements listed under this item, although described separately, are costed through an actuarial evaluation and, therefore, accounted as a total cost in the annexed table, except for the separation payment scheme.