UW–Madison finalizes 2025–27 compensation strategy

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University of Wisconsin–Madison leadership has approved investments in employee compensation totaling $27.6 million across fiscal years 2025–27. These investments will be accompanied by a salary structure update.  

In the context of significant fiscal uncertainty and budget constraints experienced this year, UW leadership has worked deliberately to bring together available resources to address compensation priorities. The current approach is intended to support the university’s total compensation philosophy, which is to be a market-competitive employer that supports UW staff and faculty. 

Fiscal year 2025–26 compensation actions 

For fiscal year 2025–26, the university is providing $19.1 million in central funds to support compensation actions. These fiscal year 2025–26 actions include: 

• $10.5 million in one-time performance bonus funds for academic staff, limited appointees, university staff and faculty, designed to recognize sustained, above-and-beyond contributions, including work associated with the Workday implementation and navigating evolving state and federal requirements. 
• $7.6 million in Act 15 faculty market funds for high-demand fields. 
• $1 million for faculty post-tenure review salary adjustments.  

Together, these resources are intended to help schools, colleges and divisions address the most critical recruitment, retention and performance-related compensation priorities during fiscal year 2025–26. 

Fiscal year 2026–27 compensation plan

For fiscal year 2026–27, UW–Madison will continue to invest in its employees through a comprehensive, centrally supported compensation plan that builds on the investments made in fiscal year 2025–26. This includes: 

• $7.5 million in base-building central compensation funding for academic staff, limited appointees, university staff, and faculty. This funding includes $500,000 to support faculty members who were not designated as serving in Act 15 high-demand fields and were therefore ineligible for those funds, but whose efforts and contributions meaningfully advance UW–Madison’s teaching, research, and service mission. 
• $1 million in continued faculty post-tenure review salary adjustments.  

These actions are designed to sustain market competitiveness, support salary growth over time, and provide units with flexibility to address discipline-specific and market-driven compensation challenges. 

Pay plan increase effective June 28, 2026  

The central compensation funds will supplement general pay increases provided through the 2025–27 state biennial budget, which includes a 3 percent pay increase for Universities of Wisconsin employees that became effective June 29, 2025, as well as a 2 percent increase planned for July 2026. The 2026 pay increase will become effective June 28, 2026, for eligible employees with 12-month (annual) appointments, and Aug. 17, 2026, for eligible employees with nine-month (academic year) appointments. Additional details about implementation of this upcoming pay increase will be provided to employees at a later date. 

Salary structure update

To ensure that UW–Madison’s salary ranges remain aligned with external labor market data, UW–Madison will implement a 3 percent salary structure update effective June 28, 2026. This update increases the minimums, midpoints and maximums of established salary ranges across employee categories. 

The salary structure update does not automatically result in individual pay increases. Instead, it ensures that salary ranges remain competitive and support current and future compensation actions. 

Implementation of central compensation funds 

Each school, college or division is being asked to outline its processes related to employee eligibility and distribution of the central compensation funds and to share that information with employees in their unit. The implementation of these programs will require a collective effort by UW–Madison’s Office of Human Resources, Universities of Wisconsin, colleges, schools, divisions, managers and supervisors. 

As with previous compensation plans, units are encouraged to review their budgets and allocate funds to address salaries for positions that are not centrally funded. 

To be eligible to receive the base salary adjustments or one-time performance bonuses, employees must be considered in good standing based on position-specific compliance requirements; must have served at least six months in their current position; must not be serving a probationary period or evaluation period; and must have met performance expectations as identified in their last performance evaluation. Supervisors are required to complete performance evaluations for the employees they supervise. Additional criteria may apply at the college, school or divisional level.