University Times

The lawyers have had their say. Now Pitt senior administrators are weighing the merits of four different models of a new early retirement incentive plan for Pitt full-time, tenured faculty.

"We're at a point where outside legal counsel has completed its review of the legality of the various options. Now it's a matter of [the administration] choosing among those options, and then putting a proposal out there to the University community for discussion," said Robert Pack, vice provost for Academic Planning and Resources Management.

Provost James Maher said yesterday, Nov. 20, that the administration isn't ready to release the draft plan but will do so soon.

Administrators and University Senate leaders say they want to make a plan available to Pitt faculty by the start of the next fiscal year in July 1997.

Pack gave a progress report on the early retirement plan at the Nov. 15 meeting of the University Senate budget policies committee (BPC).

Despite repeated requests from BPC members, Pack declined to reveal details of the options being considered. And the vice provost disagreed with BPC members' arguments that the Senate should have been involved earlier in drafting the new early retirement plan.

"We're trying to walk a thin line between giving faculty the opportunity for input, and putting forward something that we're confident will meet the broad goals of the University and is legally defensible," Pack said.

"The real question is, do you start [in soliciting feedback] with something or do you start with nothing?" he asked.

BPC members disagreed. Phil Wion, of the English department, said: "It's not something or nothing. It's one thing versus three other things.

"It seems to me that the question is, when is the appropriate time to go to Senate committees for their advice — when you've got it down to a discussion of four options that are all legally acceptable, or when the administration has picked one option that it thinks is best for the faculty?" James Holland, of psychology, said faculty could have provided valuable input throughout the process of drafting a new plan.

Holland said faculty and administrators worked well together in developing Pitt's previous early retirement plans, which became illegal after Jan. 1, 1994, when the federal government outlawed mandatory retirement ages for faculty.

But Pack said the administration is meeting its original pledge of proposing a plan that will be based on the recommendations of a February 1996 report by the Faculty Retirement Policy Review Committee — the so-called "Ochs Report," named after committee chairperson Jack Ochs, a Pitt professor of economics.

The administration had hoped to have a plan in place by the end of December 1996, but the process has been delayed by a number of legal questions. Pack cited the following issues, among others: * To encourage faculty to retire at earlier ages, it makes sense for an early retirement incentive plan to offer a benefits package that declines the longer the faculty member waits to retire. But the courts could rule that such a plan constitutes age discrimination, especially if benefits declined significantly after age 65 — generally used as a cut-off point in discrimination cases because it is the age at which retirees qualify for full Social Security benefits.

Pack said the University administration is considering a plan in which eligibility would be determined based on a combination of a retiree's age and years of service.

* Under federal law, employees who take advantage of early retirement plans generally must pay taxes on the total value of their early retirement benefits within a year after they retire. Pack said the administration hopes to provide first-year benefits that would be sufficient to offset the heavy upfront tax liability.

— Bruce Steele