University Times

The Faculty Early Re-tirement Bonus Plan Committee recommends that Pitt offer the following two plans, beginning Sept. 1.

The Window Plan Who would be eligible: Full-time and part-time tenured faculty, full-time and part-time faculty librarians whose contracts provide the expectation of continuing employment, and full-time administrators holding faculty tenure. Members of the medical school faculty, practice plans and practice corporations would be excluded.

Eligible employees must have completed 15 years of service at Pitt and reached age 62 within the plan's three-year enrollment period. Or, the sum of their years of Pitt service and their ages must be at least 90 prior to the end of the enrollment period.

Enrollment period: The report recommends a three-year "window" of Sept. 1, 1997, through Aug. 31, 2000.

However, committee members said an enrollment period of Jan. 1, 1998, through Dec. 31, 2000 might be more realistic, given that Chancellor Mark Nordenberg received the proposal just last week, and academic units already have made teaching assignments for many fall courses.

Bonuses: Faculty who met the plan's conditions would receive a payment equal to 2.5 times the sum of their contract salaries plus a 12 percent University supplement if they retired in the same year they first became eligible.

If they waited until the following year, the payment would be 2.1 times their salaries plus the supplement.

If they waited still another year, the multiple would be 1.7.

Faculty who became eligible for the window plan after its first year of operation would still qualify for the 2.5 multiple if they retired in the same year they first became eligible.

ALTERNATIVE MULTIPLES: At the committee's final meeting on June 13, five of the six faculty members of the committee voted to recommend the multiples of 2.5, 2.1 and 1.7. (The sixth faculty representative on the committee was out of the country.) But one of the two administrators on the committee — Robert Pack, vice provost for Academic Planning and Resources Management — voted against the recommendation. The other administrator, Interim Vice Chancellor for Finance Art Ramicone, abstained. The administrators questioned the plan's affordability.

As a result of the mixed vote, faculty representatives agreed to recommend, as an option, the multiples of 2.0, 1.5 and 1. But they made it clear that they preferred the multiples of 2.5, 2.1 and 1.7. In their report to Chancellor Nordenberg, the faculty stated that the lower multiples "would not achieve a satisfactory turnover because the incentives in this option are less than the payments made in the immediately preceding [Pitt early retirement] window plan which failed." Bonus cap: As noted above, payments would be based on employees' salaries plus a 12 percent Pitt supplement. This supplement would be in lieu of the University's contribution to employees' retirement funds. The total payment base (salary plus the supplement) would be capped at $100,000.

Payment schedule: The committee report does not specify whether the payment would be made in one lump sum or spaced over a number of months or years.

But committee members agreed that the tax burden on retirees probably would be lighter if the payment was extended, with payment amounts increasing over time.

Phased-Down Employment Plan Who would be eligible: Full-time and part-time tenured faculty, full-time and part-time faculty librarians whose contracts provide the expectation of continued employment, and full-time administrators with faculty tenure. Like the window plan, the phased-down plan would exclude medical faculty and members of practice plans and practice corporations.

Eligible employees must have completed 10 years of service at Pitt and have reached the age of 59 during the enrollment period.

Enrollment period: Faculty members of the early retirement committee recommended that Pitt offer this plan for five years, beginning Sept. 1, 1997, with participating faculty guaranteed a minimum two-year contract. If the enrollment period is limited to three years, the minimum contract would be for one year.

Bonuses: Faculty would reduce their workloads by half and receive two-thirds of their salaries for the length of their phased-down contract, if they commit to retire at the end of that period. This phased-down contract would not exceed five years.

During the phased-down period of employment, faculty in the plan would remain eligible for the same medical insurance available to full-time faculty.

At the end of the phased-down period, the faculty member would receive a bonus equal to his or her contract salary at the time of signing the phased-down contract, plus a 12 percent University supplement. This final payment would be adjusted to include faculty pay raises awarded in each of the phased down years.

Bonus cap: For the final payment, the contract salary plus supplement would be capped at $100,000.

— Bruce Steele