- Jake Fromm/Daily
By Kyle Swanson, Daily News Editor
Published July 11, 2010
CORRECTION APPENDED: An earlier version of this story inaccurately reported that Hanlon would receive his deferred compensation of $75,000 every year through 2014. He is only receiving his deferred compensation in 2010.
Click above to download University Provost Philip Hanlon's contract.
When Philip Hanlon assumed his new post as the University’s provost at the beginning of this month, he not only inherited the many issues that confront the University’s chief academic and budget officer, but he was also given a 64-percent pay increase.
Details of the new University Provost’s compensation package were released to The Michigan Daily after months of inquiries into Hanlon’s new contract with the University. The requests had previously been denied several times by a University spokeswoman, who said the contract had not been finalized.
However, the contract released to the Daily last week was executed on Feb. 25. The spokeswoman said the contract had not been previously released to the Daily at that time due to a communication error.
Hanlon previously earned a salary of $286,000 as vice provost for academic and budgetary affairs at the University. In his new position as University Provost, he will earn a salary of $470,000.
Hanlon’s new salary far exceeds that of former University Provost Teresa Sullivan, who earned a salary of $366,000 in 2009. Sullivan is leaving the University at the end of the month to assume the presidency at the University of Virginia, where she will receive a compensation package valued at $680,000 a year including a base salary of $485,000.
In addition to his base salary, Hanlon also received deferred compensation of $75,000 this year.
Sullivan had a similar agreement with the University, through which she was set to earn $100,000 a year in deferred compensation. However, she surrendered the deferred compensation when she announced she would leave the University before the terms of her contract ended.
And while Hanlon’s new salary may seem a significant increase, University officials say the increase is in line with a competitive market salary.
University spokeswoman Kelly Cunningham told The Michigan Daily in an e-mail last week that Hanlon’s new salary was the result of a survey among peer institutions.
“As is often the case, the University Human Resources Office conducted phone surveys among peer institutions to determine the appropriate market rate,” Cunningham wrote in an e-mail to the Daily.
Raising the salary of a high-ranking official when recruiting a new individual to fill the post is not unusual for many organizations, including the University.
Earlier this year, when David Brandon was named as Athletic Director Bill Martin’s successor, University officials increased the athletic director’s salary by 47 percent. Martin left the position with a salary of $380,000, but Brandon assumed the post with a salary of $560,000 and an annual deferred compensation of $100,000.
The salary of the University’s athletic director is paid completely by the Athletic Department, which operates as a financially self-supporting entity of the University.
But neither Hanlon nor Brandon are the highest-paid executives on the University’s campus.
University President Mary Sue Coleman, currently the sixth-highest-paid president of a public university, makes $553,000 in base pay each year, and nearly $800,000 in total compensation when including deferred compensation, bonuses and other benefits.
And in her first year as the University’s executive vice president of medical affairs in 2009, Ora Pescovitz made $700,000 in base pay and was eligible for up to $150,000 in performance incentives and $100,000 in deferred compensation. Her pay was slightly greater than her predecessor Bob Kelch, who earned a base salary of $684,000 in 2008.