Brewer,
I am a newly tenured Professor at a major research University. Please heed my words.
First, rules and norms vary from institution to institution, as others have said. However, they generally follow a certain pattern.
First, one usually has between 6-8 years to apply for and get tenure. This sometimes depends on the “step” at which you are hired (e.g., if you are hired at a higher step, you sometimes, but not always, have less time available on the “tenure clock.”). The candidate is on a renewable one or two year contract until tenure. At any time, you can find your contract not renewed. However, this is fairly rare unless you are blatantly incompetent. Generally, if you are showing good and steady progress towards tenure, you will be renewed.
The tenure review process generally takes up to one year and is very involved. Your peers will vote in secret, confidential outside reviews will be sought, and every level of the administration will have its say. If there is trouble at any of those levels, you will almost certainly not gain tenure.
If you are denied tenure, you are not “fired.” Your contract is merely not renewed. In general, the institution must give you tenure or they must let you go within their 7 to 8 year limit – one or the other. At most institutions, you are not permitted to linger (a severe demotion to below that of the Academic Senate level might permit you to stay, but you won't want to).
If you are not given tenure, the norm is for a “terminal year” and often longer depending on when you are informed of the failure of your bid. This is because the hiring cycle is a year long, and any less would leave you without any reasonable possibility of finding a new job without a long period of unemployment.
The proportion of people gaining tenure varies drastically from institution to institution. At many public Universities, the ratio of success is reasonably high – let’s say something like 80%. This is because the institution is very careful when they hire you, and they are afraid of lawsuits, and so at some level they have committed, up front, to giving you tenure – it’s “yours to lose.” That said, don’t believe it!
At private institutions, the systems can be more arbitrary. A number of private Universities are famous for granting tenure to virtually no Assistant Professors. If you hear rumors like this, let’s say the success ratio can be as low as 10% or less.
At most institutions, figure on a 50% success ratio.
However, don’t believe any of it! If you are the one that is not granted tenure, it will be the most miserable experience of your life, and the administration will absolutely seem to have engaged in capricious and evil targeting of you as an individual. Also, don’t believe you can fight and win it if the tide is against you – most Universities will fight any battle and spend any amount of money to make sure you lose so as not to set a precedent that would limit their ability to deny tenure in the future.
Should you find yourself believing that you will not be granted tenure, the best advice is to leave as early as possible (e.g., year 3 or 4). Otherwise, it will become obvious to hiring committees that you believe you won't get tenure, and they won't wish to hire you either.
If you are denied tenure, it’s not absolutely the end of your career, but it’s very damaging. One always hears of success stories, where someone was unfairly denied tenure and wound up somewhere better. But on average, your career will suffer a great blow. You will be hard pressed to find a job at an equally-ranked institution and will more likely have to leave academia or settle on an inferior position.
At most institutions, tenure does not mean more money. A little more, yes, but just a normal merit increase. It also does not mean that you can do what you please. At most institutions (especially public ones), you will still be reviewed frequently and can still lose your job. It just means that there are stronger due-process safeguards against arbitrary firings.
The biggest change is a sense of relief and lowering of stress – you have passed the gauntlet and at least you know you won’t likely have to look for a new job any time soon.
Now, a warning: Getting tenure is one of the most difficult and stressful goals you can imagine. It is seven years of running as fast and hard as you can, with 10 people willing to step into your shoes at any sign of weakness. At any reasonably high-ranking University, attaining tenure requires a brutally-relentless focus on the goal. “Publish or Perish” is not a joke, and it’s just the beginning! Starting at, say, the top-40 rankings of institutions (and every place that aspires to that), expect to have to write a few dozen peer-reviewed papers, gain multiple millions of dollars in research funds (the amount depends on your field), teach in a praise-worthy fashion, graduate a number of Ph.D. students, win a couple of research and teaching awards, serve on numerous committees, perform “community service,” and generally kiss butt at every level. Also, keep your mouth shut! You have nothing to add to the wisdom of those who are tenured! You also do not have “3 months off a year,” by the way. You will spend that time supervising and writing.
Of course, even gaining a tenure-track position is far from easy, as the competition is fierce. If you have not graduated from a top-tier school (with a Ph.D.), and have been out of academia for a while, and have not steadily published several dozen papers in the years directly preceding your applications, you will not likely be regarded as a good candidate. There is also a fair amount of unspoken age discrimination. Most institutions prefer younger candidates who are fresh out of top-tier schools, in cutting-edge fields that are "hot," who have written a rash of recognized papers (preferably winning an award or two), and who are willing and able to put in those years of the 12 hour days that it takes to succeed.
Best of luck.