Furlough/Salary Reduction Q & A
Questions and Answers About the Implementation of Furlough/Salary Reduction
The UC Office of the President (UCOP) Web site is the authoritative resource regarding the Furlough/Salary Reduction program. These questions and answers are provided by the Human Resources Office to supplement those published on the UCOP Web site.
Q: Who will be subject to the Furlough/Salary Reduction Plan effective September 1, 2009?
A: The plan covers the following types of employees:
- Faculty.
- Academic Senate.
- Non-senate.
- Non-senate academics.
- Health Sciences Compensation Plan faculty members.
- Policy-covered (non-represented) staff.
- Career, limited, per diem, and partial year career appointments.
- Regular status (career employee who is not required to serve a probationary .period or who has passed probation) and probationary employees.
- Full-time and part-time.
- Senior Management Group members.
- Rehired retirees.
- Recalled faculty.
Contract employees (employees on individual employment contracts) will be asked to voluntarily participate in the Furlough/Salary Reduction plan based on their respective pay band.
Implementation of the plan for union-represented employees will be subject to collective bargaining agreements and all applicable laws. The Office of the President is engaging with union leadership to to seek their concurrence to permit the represented staff and academic employees (subject to obligations under the Higher Education Employer-Employee Relations Act) to participate in the furlough program.
Q: Is this a permanent pay reduction?
A: The Regents approved furlough/salary reductions for one year starting September 1, 2009. The Regents may take action to approve an extension of furlough/salary reduction measures at the end of this period.
Q: Is the reduction taken on my total salary or my base salary?
A: The salary rate is defined as the monthly salary the employee is appointed to receive under an academic, nonacademic, and/or administrative title payable through the university. This includes stipends. It does not include:
- Overtime payments.
- Shift or other differential pay.
- Consulting fees or payments in lieu of private practice.
- General assistance "by-agreement" payments.
- Compensation for extension teaching.
- Any remuneration received which is in excess of 100% of full-time equivalent of your regular and normal position.
- Perquisites and any bonuses or other special compensation.
Q: What part of my salary will be used to determine the respective salary band?
A: An employee's 100% salary rate, as of January 1, 2009 (or the hire date, if later), will be used to determine the salary band.
Q: What if my salary has changed, or will change, after January 1, 2009?
A: Furlough days and the corresponding salary reduction will be determined by an employee's salary rate as of January 1, 2009 (or the hire date if later) for the term of the furlough plan. If an employee receives a salary increase after January 1, 2009, there will be no adjustment to the furlough days and the corresponding salary reduction.
Q: How will furlough days be accrued and usage tracked?
A: The Office of the President is programming the Payroll Personnel System to automatically accrue the appropriate number of furlough hours each month and a method for departmental payroll processors to report use of accrued furlough hours in the Payroll Personnel System. Departmental timesheets should be modified to allow employees to indicate use of furlough time separately from the use of sick leave and vacation hours.
Q: How much flexibility will employees have in taking furlough days off?
A: Will there be mandatory furlough/closure days at UCR? Furlough days have been formally proposed by the campus on the following days:
- December 21, 22, 23, 28, 29, and 30, 2009
- March 25, 2010
Any leftover furloughs that have been allotted to an employee may be discretionary days off with agreement from the employee's supervisor; the intent is for the days to be used each month as the days are accrued during the 12 months the plan is effect. Furlough time that is not used as expected during the plan term will expire at the end of the plan term and is not carried forward.
With supervisor's approval, accrued furlough days may be:
- Saved up and used in blocks prior to the end of the furlough period
- Used before they actually accrued to cover the scheduled furlough/closure days
- Used as early as September 1, 2009. Supervisors have the authority to approve the use of furlough days in advance of accrual in order to manage employee schedules during the term of the plan.
Q: During the furlough/closure days, will exceptions be made for employees involved with critical services?
During closures, essential services will continue to operate at a minimal level. Deans and vice chancellors will determine the facilities and/or operations within their purview that need to remain fully or partially open during the closure periods and arrange for appropriate staffing. These decisions must be approved by the executive vice chancellor and provost, in accordance with university personnel policies and applicable labor agreements and subject to discussion or collective bargaining. In instances where essential employees participating in the furlough program must work during the closure period, their furlough days may be taken throughout the remainder of the year, with the approval of their supervisor or department chair.
Q: Can employees take partial furlough days or must they take full days?
Furlough time should be recorded the same as vacation - in one-day increments for exempt employees, quarter hour increments for non-exempt employees. Furlough time for employees on alternate work schedules should be recorded in the same manner that vacation or sick leave is recorded.
Q: Will the vacation maximum be raised to account for furlough time?
Furlough accruals will accumulate in a separate bank from vacation hours. At this time, no change to the vacation maximum, prescribed by Personnel Policy 41, Vacation, has been approved .
Q: Will employees in positions that are split-funded have the same percentage of furlough assigned as those who are paid by General Funds?
For employees with salaries that are partially funded from extramural funds, an exclusion will apply to that portion of their salary; they will also receive the corresponding proportional share of furlough days/hours. For example, an employee with a $50,000 annual salary, 60 percent funded from General Funds and 40 percent from extramural funds, would be in Salary Band 3 based on his/her full-time salary rate. He/she would accrue 9.6 furlough days during the year (60 percent of 16 days), and his/her salary would be reduced by $1,800 (6 percent of $30,000).
Q: How will furlough balances be handled when an employee separates?
Unused furlough days will expire at the end of the term of the plan or upon separation of employment, if earlier.
Q: Are employees on individual employment contracts subject to the furlough program?
Employees with contracts that cannot be changed unilaterally by the university will be asked for a voluntary salary reduction appropriate for their respective pay band. If the employee agrees to accept the salary reduction and furlough, the contract must be amended to reflect that the agreement is made by mutual consent as an addendum to contract which is signed and dated.
Q: What happens if employees on individual employment contracts won't agree to voluntarily take a pay reduction?
The university must honor the terms of the contract, but most contracts include an option to terminate the contract early. If voluntary agreement is not reached, the department may elect to terminate the contract appointment early to obtain the cost reduction. This option could be exercised if circumstances indicate that would be an appropriate course of action.
Q: Will hardship exemptions be offered?
There is no indication that this topic is under consideration by the Office of the President.
Q: How will the plan work for part-time employees?
A: Part-time employees will be allotted furlough days and have their salary reduced in proportion to their full-time equivalent salary. For example, an employee who has a 60% appointment and earns $60,000 per year ($100,000 full-time equivalent) is within salary band 5 that allots 21 furlough days and an 8% salary reduction; employee will receive 12.6 furlough days and a $4,800 salary reduction (8% of $60,000).
Q: If an employee is appointed at 50% time, will they lose their benefits when the furlough is implemented?
A: No, the program was designed to ensure continuance of benefits eligibility and retirement service credit at the individual's pre-furlough rate. By implementing the furlough through crediting of furlough days and a corresponding reduction in pay, employees time worked will not be reduced in the payroll system.
Q: Will monthly health insurance premiums be adjusted for the rest of 2009 if the furlough/salary reduction drops employees into lower medical plan salary bands?
A: No.
Q: If an employee is currently working at a reduced percentage, but is not on START, can they increase their percentage to offset the furlough deduction?
A: No, the intent of the program is to generate salary savings. Allowing such an action undermines the principle of shared sacrifice and produces localized inequities among departmental staff.
Q: Will employees be permitted to choose START before/after the Furlough/Salary Reduction Plan is implemented?
A: The START program continues to be in effect through June 30, 2010. Employee participation is voluntary, and is dependent on the approval of the department head. While on START, participants do not receive furlough days. Employees whose START contract expires during the plan term (i.e., START ends June 30, 2010) will be placed in Furlough/Salary Reduction Plan the day following the expiration. All START participants will be placed in the plan, there are no exemptions.
Q: Can an employee participate in START and the Furlough/Salary Reduction Plan simultaneously?
A: Employees whose START reduction is less than required under the plan will require individual handling; departments will need to work with employees in this situation to (1) either increase the time reduction under START so that it equals or exceeds the plan, or (2) cancel START so that only the plan would apply. Employees whose START reduction is equal to or greater than that required under the plan are exempted from the Furlough/Salary Reduction Plan.
Q: Are new hires subject to the furlough program?
A: The employees hired into positions that are subject to the salary reduction and furlough plan will participate in the program. For guidance on how to communicate this to candidates, contact Human Resources. Revised sample offer letters will be available on the Human Resources web site shortly.
Q: How do furloughs impact 9/80 or other alternate work schedules?
A: Furlough hours are a separate bank of hours that must be used within the 12-month period of the program. The furlough program does not directly impact alternate work schedules. However, alternate work schedules are a privilege, not a right of employees. Given the severity of the budget crisis, and the potential impact off that additional days off may have on operations, managers may have the need to cancel alternate schedules for some or all employees.
Q: How does this program impact rehired retirees?
A: Rehired retirees are expected to participate in the program if they hold positions that are part of the salary reduction and furlough plan. Their pay will be reduced and furlough time will be accrued in a manner consistent with other employees in similar personnel programs, appointment types, and appointment percentages.
Q: Will the furlough program impact severance payments if employees are laid off?
A: No, severance payments will be based on the employee's pre-salary reduction rate of pay.
Q: If an employee separates, will the terminal vacation pay be reduced because of the furlough program?
A: There should be no impact on the vacation pay-off (terminal vacation pay) because the two banks of hours are defined and handled separately.
Q: How does this program impact represented employees?
A: Existing rights under law or contract will be used to implement the plan. Where bargaining is required, the university will bargain in good faith so as to avoid implementing layoffs to the greatest extent possible.
Q: Will non-represented employees' salary be reduced even if the represented employees don't participate?
A: Yes, all employees identified as being subject to the salary reduction and furlough plan will be required to participate in the program.