by Daniel McCabe
For some longtime employees, it could be the ticket to an exciting new life. For the University, it could be a crucial way to effect savings in the face of further funding cuts.
McGill's much anticipated Special Voluntary Workforce Reduction Plan is being unveiled. The plan is chiefly directed towards faculty and staff over the age of 55. About 560 employees with either tenure or job security will have one monthfrom April 15 to May 15to decide if the plan is right for them. According to a recent presentation by Principal Bernard Shapiro to the Board of Governors, this is the only such plan his administration intends to offer.
"This is an opportunity that could be very attractive for people," says Vice-Principal (Administration and Finance) Phyllis Heaphy. "If they take this package over a period of several years and add it to what they'll be receiving from the Quebec and McGill pension plans, some staff who are 60 or older will be in a position to retire with 85 to 100% of their current earnings. Some staff who are 55 years old will be in a position to receive 60% of their current earningsmore than enough to start you on a second career."
Every staff member eligible for the plan will receive a letter in early April detailing what the plan could mean for them specifically, and will include the name and phone number of a resource person who could be contacted for additional information. "The letters will be very clear about what the plan has to offer every employee who is eligible for it," says Heaphy.
The plan has been designed to be very flexible. "You can receive a lump sum, spread it over three years or receive it in instalments over your lifetime. You can also roll it into your RRSP if you want," she says.
McGill will sponsor a series of seminars in April to elaborate on the plan and every eligible employee will be entitled to an hour-and-a-half of personal financial counselling at University expense.
"All employees will have the information they require to make an informed decision," says Heaphy.
She makes no apologies for the short time frame in which the plan will be available.
"The nature of such plans is that they work best when they're presented as a short, sharp shock. I'm not sure we would be doing anyone any favours by having them agonize over it for five months. Besides, we feel that the people who take this plan will be those who've been seriously considering retiring for awhile. Many have just been waiting for this sort of offer. Also, this has to be completed by the end of the fiscal year so we can plan for it properly."
In a memo sent to all members of the Board of Governors (and currently accessible on infoMcGill and on the Web at http://blizzard.cc.mcgill.ca/uro/News/work.htm), Shapiro argues that such a plan is necessary if McGill is to absorb more cuts from the province, while still dealing with urgent priorities such as paying off the University's accumulated deficit, hiring new staff and attending to deteriorating facilities.
While Shapiro has been consistent about the need to address the University's financial challenges, he has also often stated that change must be driven by academic priorities rather than by economic factors. He says the plan is consistent with that philosophy.
"Given the budgetary compression we're facing, if we don't do something like this, we won't have any opportunity at all to replenish our academic or non-academic sectors," stresses Shapiro.
According to Heaphy, McGill will hire one new employee for every five who leave as a result of this offering. "That applies to academic and non academic units," says Heaphy. "How will we decide who gets hired? That won't be an easy question to answer."
Under McGill's existing early retirement schemelimited to academic staffabout 30 faculty retire each year. The existing plan provides a retirement allowance equal to either five percent of current salary for each year of service or 75% of the total salary that would have been earned to age 65whichever is less.
The enhanced early retirement allowance will offer all the benefits of the current plan, but to faculty and non-academics alike. In addition, academic staff (including those who are 65 and older and not entitled to the provisions of the existing early retirement plan) will be offered six months salary.
Administrative staff will receive different amounts depending on age. Those 55 to 58 years of age will be offered nine months salary, 59- to 61 year-olds can get six months salary and staff aged 62 or over could receive three months salary.
Certain categories of staff won't have access to the new plan. These include members of the Service Employees' Union and the Canadian Marine Officers' Union, as well as staff who are either wholly supported by research funds or who work in self-funding units.
Academic staff over 55 will also be eligible for a related program involving a reduced workload leading to early retirement. Faculty willing to commit to early retirement, preceded by a period of reduced workload and salary, would receive a bonus based on a proportion of their salary as an inducement. This offer, too, is only open for one month.
Faculty who accept the plan will retain life and supplemental health insurance, education assistance, library privileges and membership in various university-related entities. Depending on their departments, there may also be the possibility of teaching on a contractual basis, use of office space and access to computers.
At Senate earlier this year, Shapiro warned that unless early retirement schemes were carefully designed, they could do unexpected damage to a university's academic programs. "The great danger with these plans is that academic units can be undone by accident if a number of people in an important area all decide to leave."
This is why the University's plan will include a "mutual benefit clause," to protect departments and units from losing a critical mass of staff all at once. As a guiding principle, the administration will try to ensure that no department loses more than 10% of its staff as a result of this offer.
"Departments and faculties will be protected. That isn't to say that there won't be difficulties created by this. In some cases, deans and chairs are going to lose people they would prefer not to lose," says Shapiro.
Heaphy emphasizes that the University will accommodate as many early retirement requests as possible. "We will try and grant every single request. We want people to take this packagewe don't want any roadblocks put in their way."
If the administration has to put a cap on staff who receive early retirement inducements, "any decision we make will be based strictly on seniority as defined by age and years of experience.
"The administration will encourage units to rethink their areas and give them some assistance so that they can," says Heaphy. "We're definitely encouraging units who wish to work closely with others. We'll put our money where our mouth is in that regard."
The administration is still working on another component to its plan, one directed towards younger staff. A permanently reduced workload scheme would see faculty and administrative staff volunteer to restructure their jobs and work fewer hours with a corresponding decrease in salary. In return, they would receive a full year's salary during the first year of their reduced workload.
"I know a lot of younger people who might be interested," says Heaphy. "People who might want to spend an extra day each week with their families. Others who want to start to prepare for a second career could go to school, while still working three days a week."
McGill Association of University Teachers president Professor Ted Meighen gives the plan qualified approval. He thinks it provides a fair incentive to faculty over the age of 60, but is disappointed that academics without tenure or job security aren't entitled to it. He also wishes that faculty who accept the plan, but wish to stay active in research, could be given more assurances that they would have access to their labs.
"Still, this is a reasonably good attempt to accommodate everything involvedour financial situation and the difficulties we could face if we lost a huge number of people."
Heaphy says there is no need for a mad rush to get applications in once April 15 rolls around. "An application received first thing in the morning on April 15 will receive exactly the same consideration as one handed in on May 15 at 4:30 in the afternoon."