UNIVERSITY PARK, Pa. — Penn State is beginning the process to implement general salary increases (GSI) for faculty and staff, following action by the Pennsylvania legislature and governor to release Penn State's 2023-24 appropriations. New salaries will be reflected in January 2024 paychecks, and the salary increases will be retroactive to July 1.
The Applied Research Laboratory (ARL), as a self-supporting unit, will follow an internal process that will be communicated separately to ARL employees.
While the appropriation was delayed, the university temporarily redirected funding from GSI to support its in-state tuition discount and maintain its commitment to Pennsylvania resident students and their families.
At its July meeting, the Penn State Board of Trustees approved budgets for the 2023-24 and 2024-25 fiscal years that include 3% pools for unit executives to award merit-based general salary increases (GSI) for employees. Actual individual percentage increases will be determined during the employee review process and reflect employee performance, so individual salary increases may be higher or lower than 3%.
“We’re grateful that the General Assembly and governor have approved the funding that will allow us to move forward with processing GSI for our faculty and staff,” said Penn State President Neeli Bendapudi. “Our faculty and staff show their dedication to the mission of Penn State every day, and we’re thankful for their continued patience as we now implement the salary increases they have earned.”
“We had really hoped to be able to process GSI prior to the winter break,” said Vice President for Human Resources Jennifer Wilkes, “but, despite our best efforts and full focus on processing GSI, it will take a number of weeks to implement the new salaries for Penn State’s tens of thousands of faculty and staff.”
With the retroactive salary increases going back to July 1, some individuals may see that they are being taxed at a higher rate for this single paycheck. Tax withholdings will be calculated based on the gross taxable salary contained in the paycheck reflecting the salary increase and retroactive pay. The retroactive pay will be considered income earned in 2024 for tax purposes.
More information on the Compensation Modernization Initiative, including the new salary grades corresponding to the University’s updated job classifications, will be shared soon.