Faculty Senate

February 4, 2004

 

Attendees: Henry Scarton, Lou Padula, Curtis Powell, Robert Block, Tamar Gordon, Patricia Search, Ash Kapila, Bruce Nauman, Cheryl Geisler, Wesley Huang, Jim Stodder, Peter Persans, Debbie Kaminski, June Deery, Bill St. John, Bill Puka, Ed Rogers, Terry Blanchet, Sharon Anderson-Gold, Bernie Fleishman, Richard Leifer, Bolek Szymanski, John Harrington, Joel Plawsky, Jeff Durgee, Achille Messac, Mark Goldberg, Gary Gabriele, Pamela Theroux, Tom Apple, Mary Anne Waltz, David Bell

 

Agenda

Approval of Minutes from 12/5/2003 Faculty Senate meeting and 1/21/2004 General Faculty Meeting

Compensation – June Deery, Faculty Advisory Group

Retiree Benefits – Ed Rogers

            Wellness

            Income

College Consortium Benefits – Bill Puka

Report on Benefits – Curtis Powell

            Response to College Consortium

            Comments on Retiree Benefits Report

            Healthcare Costs

            Rensselaer’s Goal and Objectives

            Industry Update

            Changes for 2004        

            Long-term Disability and Workers’ Compensation

            Rensselaer Health Plan

            Rensselaer Payroll Deductions

            Benchmark

Benefits Q&A

Results of the Core Curriculum Vote – Bruce Nauman

Working Groups

Adjournment

 

Approval of Minutes from 12/5/2003 and Delay in Approval of 1/21/2004 Minutes

The Minutes from 12/5/2003 were approved with minor changes:  11 in favor, none opposed, no abstentions.  Due to many suggested revisions, the approval of the 1/21/2004 Minutes was delayed until the next senate meeting.

 

Compensation – June Deery, Faculty Advisory Group

June Deery reported on the activities of the Faculty Advisory Group on Compensation.  The group was charged with helping categorize faculty performance, determining how to reward those who were doing well and determining how to retain and attract top faculty.  The committee was told that Rensselaer was going to make a concerted effort to compare the salaries of Rensselaer faculty with those of the top 25 universities nationally.

 

In July 2003, there was a report to the Deans and Chairs (see attached).  The general idea was for Deans to guide faculty on how to assess individuals in their own field with some indicators of performance. Evaluators would also have some flexibility.  Base salaries would be normalized by looking at the market yearly and if there were salary adjustments needed, it would start with those most out of alignment.  The report, while trying to be comprehensive, could not cover everything.  There was some reassurance that faculty salaries would not decrease and that salary adjustments would come from a separate fund, not those designated for salaries or merit increases.  This would occur during a one-time major adjustment as opposed to an annual evaluation. 

 

Some questions not addressed include:

Where is the salary information being kept and who has access to it?

With current budget cuts, will this actually ever happen?

Is there a separate budget for such a process?

Will this eliminate any gender inequities, or adjust for deflated starting salaries?

Will any back pay and fringe benefits be included?

 

The report does not address when all departments would follow the new template and whether each department would have their own criteria or whether they would follow universal standards.  It is not clear if demotion will occur or if it does, whether there is an appeals process.  It is not clear how this relates to Promotion & Tenure and whether it will involve a peer review.  There was no discussion in the report on getting rid of tenure.

 

Richard Leifer, a Faculty Advisory Group member, stated that there is always some kind of trepidation with a faculty/administrator committee.  In his opinion, Curtis has done a great job in letting faculty participate and in playing the role of a facilitator. 

 

Ash Kapila asked if there was any discussion about what would happen if someone were put in a particular range in the salary table and wished to be reevaluated. He asked how long it would be before the next evaluation and the possibility of a change.  June Deery thought that it would be done on an annual basis.

 

Cheryl Geisler, President of the Faculty Senate, asked if faculty will see a statement on how they rank during the annual review process after this new system is implemented.  June stated it was a good question, but not addressed by the report.

 

Cheryl Geisler asked Curtis Powell to comment on the timeline for implementation of the new system.  Curtis replied that right now each Dean has been asked to work within their school to define criteria.  Once those are completed, they will be used to develop Rensselaer standards which will not be the same for each school.  It would be desirable to have the deliberations on core Rensselaer standards done by July 1, but with the current results and comments, Curtis doubts very seriously it will be done by then. He then added “But we’ve already made some key changes, equity changes, across each school and among faculty in the last two to three years and I shared that with the committee that some of you may have been recipients of those changes.  It’s not that we’re sitting back and not doing anything, we want to correct immediately any inequities that we see. When it’s all said and done, obviously we want faculty and staff to have salary plans and salary structures in place that they can recognize as what they are.  It’s not some secret in the Deans office or the HR office or in the Provost office.  We want to make them known to the faculty.”

 

Wesley Huang, member of the Faculty Advisory Group, said when this was originally proposed, there was a lot of concern.  The administration agreed there are good reasons to revise the compensation system and he feels that if the committee devises criteria, the administration is willing to allocate money to correct the inequities.  It seems there will be a certain amount of structure imposed by administration such as salary ranges based on the market and rank and evaluations done by department Chairs and Deans.  There are still some details about structure that are vague such as salary stability and base pay vs. merit raises.  A faculty range is judged by long term accomplishments in a 3-5 year period, where merit raises are based on the previous year.

 

Sharon Anderson-Gold, Senator-at-Large, asked if there is any more information on a separate budget for this project.  Curtis Powell stated there is a separate fund for this.  Sharon voiced concern since she has heard there are budget cuts.  Curtis assured her there are no budget cuts, but perhaps budget normalization.  President Jackson asked for this to be completed last fiscal year.  He said the funds are still available to do this.  Rensselaer is investing in capital such as buildings and centers and the same investments must be made in people.

 

See attachment for slides of June Deery’s presentation.

 

Retiree Benefits – Ed Rogers 

Ed Rogers, Emeritus Faculty, began his talk with “Each of you who retire will have some serious concerns that are certain to grow with time including wellness, income and the passage of friends and family.” Ed went on to say that he would focus of wellness and income.

 

Wellness

Health insurance is currently a big issue.  Active employees have a health plan just as retirees have one, however the one for active employees will probably not be the same as when you retire. 

 

Medicare will help although medical premiums will go up even though Medicare becomes the primary source of insurance.  An interesting thing that has come along is the new prescription plan.  How it will affect Rensselaer is still unknown.  He added that dental insurance ends 18 months from the date of retirement.

 

Income

Sources in retirement include social security, Rensselaer pension, savings, IRAs, and any pensions from previous employers.  Most people receiving pensions are receiving them in the form of a fixed income.  On rare occasions, Rensselaer has granted a cost of living adjustment for the fixed portion of these benefits.  The last such adjustment was in July 1991.  In the years since, the cost of living has increased 40%, thus a current concern of retirees is updating these fixed pensions to better reflect the current cost of living.

 

Under discussion in the retiree’s forum with Rensselaer Human Resources are two possible adjustments.  One is a 70% recovery of net compound loss to inflation from 1990 to 2003 and a stop gap for the neediest which will consist of a minimum pension of $25 per month per year of service.

 

A major problem is that $18 million of funding will be required from Rensselaer just to keep the defined benefit retirement plan properly funded for active employees and those already retired.  Understanding how this has happened is crucial. 

 

In his closing thoughts, Ed stated that all benefit programs are complex, advised everyone to pay close attention to information and correspondence from HR and also stated that retirees take an active interest and pride in Rensselaer’s on-going accomplishments.

 

(Details of presentation available here)

 

College Consortium Benefits – Bill Puka

When Bill first came to Rensselaer 20 years ago, although the salary was low, one of the perks was that children could go to almost any other school for free or at 75% tuition.  However, that policy has been eliminated and dependents only get $1500 per semester or per year.  He suggested that one way to get total compensation without costing RPI anything would be for RPI to join a college consortium that has a tuition exchange program.  This would allow faculty to send their children to school 75% or 100% tuition-free as an exchange with other schools.  He suggested that Rensselaer create one for top-notch schools.   Alternatively, there is a consortium that exists at tuitionexchange.org which has 530 colleges in it in 47 states plus Great Britain.

 

To be a candidate for this, a family member must be an eligible employee at a participating institution and certified by the sending institution.  Once this is done, normal admissions apply.  The main benefit is that it attracts outstanding employees and attracts people to the school.  The list includes Smith, Trinity, GWU, Syracuse, University of Pittsburgh, DePaul, American University, University of Hartford, Pratt Institute, Emerson College, Wheaton, Seton Hall, Fordham, Skidmore, Hobart and Franklin & Marshal. 

 

Schools that join can set their own conditions as to how many scholarships they allow, how many exchanges are allowed and what tuition percent is covered. 

 

(Click here for additional information.)

 

Report on Benefits – Curtis Powell

Response to College Consortium

Curtis Powell stated that the consortium was looked at by Human Resources but was not appropriate due to the cost effectiveness.  If the protocols have changed, he would be willing to review it. 

 

Comments on Retiree Benefits Report

He complimented the report on retirees and agreed that retirement planning is important.  HR has improved the process of disseminating benefits information not just with new employees, but with current faculty and staff.  There are ongoing discussions with TIA-Creff, Fidelity, and Scudder reps that are available to talk to faculty and staff regarding retirement. 

 

Healthcare Costs

Obviously healthcare costs are extremely important.  Individuals running for President are all talking about healthcare and universal healthcare which has an impact on all employees. 

 

Rensselaer’s Goals and Objectives

Rensselaer is driving the platform of being an employer of choice.  Over the last few years, in the Business Review, RPI is the #2 private sector employer in this region.  Nationally, RPI is finally being recognized as well.  There are still challenges but there is a lot to be proud of. 

Industry Update

Regarding health care costs over the last few years, average national benefits increases were 15%, 14% and 12%.  Some individuals have plans that increased by 20-30%.  The national cost is now up to $7,000 per year for each employee.   Rensselaer’s average cost per employee is $6600.  Rensselaer has maintained that without increasing costs to faculty or staff by making some changes to the plan. 

 

Changes for 2004

The adoption benefit increased from $1,000 to $1,500.  The annual dental maximum increased from $1,250 to $1,500.  Rensselaer is trying to manage with our carrier what the needs and requests are of faculty and staff based on feedback.  In addition, the maximum of the flexible spending account have increased from $2,000 to $3,000.  Up to $3,000 can be deferred tax free for over the counter drugs or co-pays that are not covered under the plan.

 

Long Term Disability and Workers’ Compensation

Long term disability is now free for regular employees and paid at 100%.  Rensselaer does have an insurance carrier for Workers’ Compensation and has been working towards informing employees how to submit a report when injured on the job.  This coverage helps insure that medical bills are paid and paid in a timely fashion.

 

Rensselaer Health Plan

The Rensselaer health plan will cover dependent children up to the age of 19 unless they are enrolled in college and then they are covered to age 25.  Two of Rensselaer’s HMOs have this provision in place and the Rensselaer plan needed to be consistent.  This affected approximately 5% of RPI employees.  Emergency room visits are extremely costly to a medical plan.  With the new changes, if an individual goes to the emergency room and is admitted, the $50 co-pay is waived.  If the individual is not admitted, a $50 co-pay will be incurred.  Rensselaer health plan vision benefits have changed, too.  Now an individual can go to any eye practitioner and the 10% co-pay on glasses and lenses has been eliminated.

 

Rensselaer Payroll Deductions

There was no change in the Dental plan premiums.  The Medical Plan employee portion increased from $2.38 to $7.96 per pay period.  He noted that the average increase according to the Kaiser Family Foundation is between $239-$276/year where the RHP and R-HMO will be between $62 and $191/year.

 

Benchmark

The normal contribution to a Medical plan is 70/30 where the employer pays 70% and the employee pays 30%.  At Rensselaer, the employer pays 81% and employee pays 19%. 

 

(See attached for slides from Curtis Powell’s presentation.)

 

Benefits Q&A

Ash Kapila asked that since the faculty has input into the compensation plan, why isn’t input on benefit changes sought from the faculty?  Curtis stated that there are no major changes being made to the plan.  He first puts together an RFP (request for proposal), evaluates the plan document and what the laws recommend and lastly what the trends are.  Curtis must share these recommendations with the Board of Trustees, members of the Cabinet and President Jackson.  The most important thing that Curtis looks at is to have an effective and competitive benefit program to recruit and retain top faculty and staff.  Rensselaer’s benefit program is one of the best in the country and he wants to continue to have that.

 

Ash thought that with any change there would be some formal way in which input from faculty and staff could be taken, perhaps some sort of an institute-wide committee to look at healthcare benefits.  Ed Rogers stated there had been a healthcare task force but now the Faculty Senate generally has a compensation committee.  Henry Scarton said he had previously been on the fringe benefit committee but then it disappeared.  He believes that much of this negativism could be ended if there were some sort of informal conversations regarding benefits.  Curtis responded that when those committees were put together, it was for major changes to the healthcare benefits.  Henry Scarton suggested grandfathering people in when changes are made to avoid people misunderstanding what their coverage is.  Curtis responded by explaining there is an effective communication campaign that goes out to all faculty and staff explaining what the changes will be to allow people to understand coverage.

 

Jim Stodder, Senator from Hartford, asked Curtis Powell if his goal of making Rensselaer an 'employer of choice' extends to the Hartford campus.  Jim mentioned Rensselaer-Hartford's poor record on attracting tenure/tenure track faculty. There were three Lally positions open last Fall, for which there were both internal and external candidates.  None of the three was filled.

 

Curtis replied that it's 'one Rensselaer'.  Keeping that in mind, he has put in place at Hartford an HR manager, Jody Danielson.  She is part of the HR team and Curtis works with her on the total compensation package. For the first time this year, HR has looked at the medical plans on the Hartford campus and they will be brought in line with what is done in Troy.

 

Bruce Nauman asked about the $18 million expense.  Curtis responded by saying that due to the funding level required by the IRS, Rensselaer may experience a $50 - $70 million deficit over three years.  Curtis builds a projection over a three year plan to know what has to be put in each year based on the market to contribute $70 million into the plan.  This year $18 million has to be contributed, but it may change next year depending on the market. Bruce then asked what would happen to that expense if the minimum benefit was raised to $25 per month per year of service.  Curtis said they are looking into that.

 

Tamar Gordon, Senator-at-Large, stated that what is missing from the summary of changes is the increase in the drug co-pay.  It went from $10 for a brand name drug to $25 which is a 150% increase.  Along with the addition of the $50 co-pay for an emergency room visit, she felt that these changes are not minor changes as Curtis suggested, but rather major ones.  Curtis responded that the prescription drug change was changed a year ago and discussed at that time.

 

Bernie Fleishman, retired faculty member, pointed out that regarding the $11 million that arose, there were times when the institute put nothing into the pension fund.  If the Institute stresses to its employees to plan for retirement, the institute should do the same.  He added that prudent provisions for the future are to anticipate market ups and downs.  Curtis responded by saying that even during years where the market was good and the actuaries stated that the Institute did not have to make contributions to the plan, they did anyway.

 

Ash Kapila made an observation that the change in the coverage for dependents that normally covered them to age 25 and now only covers them to 19 places a burden on the 5% of those that it affected.  He stated that although Curtis mentioned in his presentation that it was a loophole, it was a benefit that people had.  Now if the faculty covers the cost of their dependent’s medical coverage, it is essentially cutting their salary by $4,000.  Curtis responded by stating he has a dependent that will graduate college and may not get a job and receive benefits.  He felt it would not be fair to rely on the people in the room to cover the medical benefits of his dependents.

 

Bob Block, retired faculty, stated that recruitment and retention of faculty was emphasized but retired faculty is not.  He felt that the whole package must be looked at including how well faculty will do when they retire and how well RPI retirees do compared to retirees from similar colleges.  Curtis said that he is meeting with the retiree’s forum to discuss how these individuals can get the best benefit plan.  He added there are only 25% of businesses and employers who offer medical benefits to retirees.  President Bush has stated that if employers offer medical plans for retirees then the federal government will discuss supporting it.  RPI can strengthen the medical and prescription program.  It is very complex, it is not easy and it is not one size fits all.  When discussing financial planning it is surprising to note that there are people not enrolled in the contribution program.  A 457b program was just initiated where people can defer money.  There is also a 403b program however only 25% of faculty and staff are enrolled in the program.  These tools are there for individuals to get ready for retirement.

 

Results of the Core Curriculum Vote – Bruce Nauman

There were 208 votes received, 144 against the Core Curriculum Proposal and 64 in favor.

 

Working Groups

President Geisler noted that if any of the working groups have action items that need to be addressed, they should be brought to the Faculty Senate Executive Committee.

 

Adjournment

Meeting adjourned to working groups at 3:24.