Wage Cut Proposal from Administration

Dear Colleagues,

On Tuesday, President Chris Sinclair and Executive Director Dave Cecil met with the UO’s Director of Employee Relations Missy Matella and Executive Vice Provost Janet Woodruff-Borden. They discussed the administration’s wage cut proposal for two hours. They had a follow-up meeting yesterday afternoon.

The email below describes the wage cut proposal, UA leadership’s questions and problems with the proposal, ideas we raised during that discussion, and consequences of not agreeing to their proposal. Because these conversations are less than 36 hours old, the email below is not a full summary of all points of the plan or a full account of the discussion. More information will follow and we welcome your questions.

Executive Summary
The administration wants faculty to agree to a wage cut plan in the event of revenue loss. United Academics leadership has concerns about the proposal and would like to bargain the plan. If UA does not agree to the wage cut plan, the administration intends to either non-renew all 211 Career faculty who are up for renewal this spring or offer them only 0.1 FTE contracts. In order for a wage cut plan for faculty to go into effect, the membership of United Academics would have to vote in favor of the plan.

The administration proposed a wage cut system that would be triggered if there was a decrease in revenue due to an enrollment decline or a loss in state funding. The administration’s plan is driven by a reasonable fear that enrollment might decline, or more likely, there will be a large reduction in state funding. A decline in enrollment or a loss of state funding would likely be a loss of millions of dollars, almost all of it to the E&G budget, which is the budget “bucket” that funds the UO’s academic programs including faculty salaries and other instructional expenses. This is partly why the administration thinks that cuts to faculty salaries is the solution to fill the projected hole.

The cuts would impact almost all university employees.* They proposed five levels of cuts depending on how much the university needed to raise. The five levels are designed to fill any budget hole caused by a decrease in funding, so they are almost 1:1. In other words, if we lose $10M, the $10M plan would be triggered. If there was a $25M shortfall, the $25M plan would be triggered. If there are multiple shortfalls, under the plan, the level for the cumulative decrease in funding would be implemented.

If a triggering event happened, the cuts that result from that event would last for two years, then salaries would be restored. If a triggering event happened at the end of the two-year window, the cuts would last for two more years. Under this plan, it would be possible for faculty to have four years of wage cuts.

The cuts would be progressive based on salary, starting for those who make between $40,000 and $50,000 and increasing until $200,000. You can see the progressive plan at this link. Proposed cuts are ~1% or less for employees earning $40,000 to $50,000 and go up incrementally from there with all people making more than $200,000 receiving the same percentage cut.

Our initial reaction to the proposal was that, in addition to preferring that wage cuts be voluntary, it seemed to us that they needed to start at a higher salary level and needed to continue increasing the size of the cuts to a higher top end. Sinclair said that in our conversations with faculty, there were many people who wanted to be part of a wage cut program, but almost everyone thought the program needed to start higher – closer to $100,000 – and be capped much higher than $200,000. Most of our senior administrators earn well north of $200,000 and it didn’t make sense not to ask them to take a larger share of the cuts, since they enjoy larger salaries.

We also argued that in exchange for salary cuts, the administration would need to allow for more oversight and input into budgetary decisions. Many of the faculty we have talked with through the union meeting, Tuesday and Thursday Zoom lunches, and informal conversations have expressed a keen desire to help their fellow faculty – particularly the Career faculty – by taking a temporary wage cut. We wanted some assurances that the administration would not use the wage cut money to hire new deans or embark on new projects while continuing to cut faculty or other employees.

Throughout bargaining, the administration has not been receptive to the idea of increased shared governance or faculty input or review of administration decision making. They have expressed to us that how the university spends money is a management prerogative and that faculty input is not needed. These sentiments were repeated in our conversations this week. Administration’s perspective is that the COVID crisis would be the sole cause of a budget crisis, so no change in budgetary practices or faculty input is warranted.

The administration is proposing no other money-saving measures at this time. The hiring freeze and wage cuts are the only proposed solutions to an anticipated budget crisis. While the administration has not said that they will not listen to faculty ideas on where or how to save money or find new revenue, they have so far demonstrated no willingness to implement or even entertain any other suggestions.

The administration made it clear that if we do not accept a wage cut plan, they will either non-renew all Career faculty up for renewal this spring, or offer them only 0.1 FTE contracts on May 1. We have 211 Career faculty who are up for renewal this year. These faculty are not evenly distributed around campus; they just happen to be on contracts that are up for renewal at this time. For instance, there are 17 Composition faculty who are up for renewal, many of them long-time instructors who have won multiple teaching awards. There are 18 faculty in the Lundquist College of Business up for renewal. Landscape Architecture could lose 13 Career faculty. In these and other areas, faculty could lose their jobs and departments could lose valued faculty not due to poor performance or disciplinary issues, but merely because these contracts are up for renewal during the pandemic.

The administration insists that their promise to either non-renew or renew at 0.1 FTE is not a threat to try to get us to agree to a wage cut package in two weeks. They insist it will be their only choice. Their assertions, however, run contrary to all messages from deans so far who are telling departments and units to anticipate few non-renewals. Moreover, the deans say it would not make any sense to non-renew everyone who happens to be up for renewal. There is no thought that a dip in enrollment would mean that Composition would be in a position to cut 17 faculty members or that Romance Languages could have a need for 18 fewer faculty members.

We firmly believe that the administration is holding these contracts hostage and using them as leverage in an attempt to bully the faculty into quickly agreeing to the administration’s wage cut plan. We asked if waiting until the May 10 deadline for new freshmen to put down a deposit, and thereby giving everyone more information about enrollment, would help, but we were told that we had to agree to the wage cut plan or it was 0.1 FTE or non-renewal for all 211 faculty. 

To be clear, we are not automatically opposed to a wage cut plan. In our conversations, we suggested that a wage cut package should be part of our bargaining conversation, so we had more flexibility to exchange proposals and ideas over a longer period of time. We believe that temporary wage cuts can be part of a solution to a budgetary crisis, but there needs to be careful planning, full understanding, and thoughtful consideration before drastic actions are taken. You probably have a million questions about how all of this would work – so do we! We think that talking it out over the course of bargaining is the best solution to ensure that we get a fair deal for all faculty. 

Any wage cut plan could only be implemented with majority approval of the full members of United Academics who participate in a vote on the proposal. If the leadership of UA believes the administration has made a reasonable proposal, we will refer it to a vote of the membership for ratification. There will be a period of time for discussion before any vote is held.

At this time, we do not feel like the proposal addresses enough of our concerns to bring it to a vote of the membership.

Again, if you have questions, please ask them. If we don’t know the answers, we can ask the administration for clarity. You can also check out the FAQ page, where many questions are asked and answered.

*Positions funded by external grants are exempt from the program, as their funding does not rely on either tuition or state funds. We do not know if the salaries of coaches or other athletics department personnel will be cut under this plan.