Harvard Staff Wrestle With Buyouts

Approximately 1,600 eligible staff workers received a crimson folder containing details about their early retirement packages on Tuesday, posing a challenge for recipients weighing the offer’s benefits against the possibility of being laid off after choosing to stay.

A longtime staff worker said she will likely accept the “generous” benefits of the package, including a year’s salary and improved insurance plans. She and two other staffers quoted by The Crimson in this article all asked that they not be named in order to protect their relationship with University officials.

Despite the new incentives, the package’s arrival has alarmed staffers faced with the possibility of leaving Harvard, voluntarily or not.

“Everybody knows. It’s general knowledge,” one administrator who recieved the package said of the possible staff cuts. “I can’t imagine there won’t be layoffs, so those of us who feel vulnerable have to make a decision.”

In addition to detailed descriptions of the program and a list of support resources, every package includes an individualized statement detailing the recipient’s potential benefits—a figure determined by the employee’s age, salary, and length of service.

University staffers who retire under the incentive program will receive one-time pension benefits equal to their annual salaries, reduced by any severance packages they had been entitled to receive. Individuals may receive the benefits as a single lump sum payment or as an annuity.

Those under the age of 62 will also receive a special “bridge benefit” of $750 a month until they become eligible for Social Security.

Though retirees are eligible for “enhanced” medical, dental, and life insurance coverage, the package repeatedly notes, in italics, that employees are not guaranteed such coverage because the University can “change or end its retiree benefits in the future.”

In a time of economic uncertainty, it remains unclear whether eligible staff workers will opt to leave their jobs. Choosing retirement would have a certain finality: those who leave under the plan will not be eligible for re-employment with the University for at least one year from the date of retirement, according to the package.

One FAS staffer working in an academic department said that the current package is not generous enough to appeal to staffers below the cusp of retirement. Of the 516 FAS staffers who are eligible for the program, only 87 are 65 years of age or older, according to the package.

Eligible employees—those at least 55 years of age who have worked at the University for a minimum of 10 years as of June 30 of this year—will have 45 days to accept or decline the package, which repeatedly advises recipients to consult with an attorney prior to signing the form indicating their choice.

A staffer who accepts the plan and signs the form within the 45-day “election” period—slated to end April 6—would have seven days to revoke the decision.

The countdown has already begun, and, according to one administrator, the plan’s progress has been moving at an alarming rate since the University’s announcement of the plan last Tuesday.

“June 30 is really not that far away,” the individual said. “Lives are going to change radically.”

In meetings with department administrators last week, FAS finance officials said the University will reassess budgets after the end of the 45-day period and begin discussions about layoffs with the Office of the General Counsel and human resources officials.

“We’re in a weird position because there’s always the threat of layoffs hanging over our heads,” said the administrator citing heightened levels of anxiety among staff. “It’s causing a lot of stress and angst among the people I know.”

University President Drew G. Faust said in a letter to the community yesterday that the financial crisis will “entail hard choices about what matters most—not an easy exercise for a university like ours.”

But the president’s tone rubbed some staffers the wrong way.

“She pissed off a lot of people here with her attitude, ‘Oh, we’re all in it together, we’ll get through this,’” said one staffer.

—Staff writer Bonnie J. Kavoussi can be reached kavoussi@fas.harvard.edu.

—Staff writer Esther I. Yi can be reached at estheryi@fas.harvard.edu.