The University of Tennessee at Knoxville will implement a voluntary retirement plan for faculty. It has the potential to free up nearly $ 50 million for the university.
Provost and Senior Vice Chancellor John Zomchick announced the plan on Thursday at the UT System Board’s Finance and Administration Committee. The council approved the plan on Friday.
“We see this as a benefit for the university as it will create flexibility for us to align our resources that will be released by the pension plan with the new strategic vision,” Zomchick said.
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Who is eligible?
Zomchick said 386 employees would be eligible for the voluntary retirement scheme.
Employees are eligible for the voluntary program if they hold a full-time faculty position, have at least 20 years of service, and are part of the Tennessee Consolidated Retirement System, Joint Contributory Retirement System, or Retirement Program. optional. Permanent and non-permanent employees may be eligible.
The plan is only available to faculty at the Knoxville campus, including the UT Institute of Agriculture and the UT Space Institute.
Most eligible professors are found at the College of Arts and Sciences, the university’s largest college.
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What does the plan include?
The university has provided different incentives based on the working hours of faculty members at the university.
Incentive premiums are:
- 20-25 years of service: 6 months base salary
- 26-29 years of service: 9 months of base salary
- 30+ years of service: 12 months of base salary
Base salary is the amount of money a salaried employee regularly earns before any additions or deductions are applied to their earnings.
How does this affect the university?
The voluntary pension scheme will free up money across the university that would otherwise be spent on faculty salaries.
If everyone who qualifies participates in the plan, the university could see nearly $ 50 million in salaries affected.
However, it is unlikely that all eligible teachers will attend. Of the 386 teachers eligible for the plan, Zomchick estimates that 30% of them will register. It will cost the university $ 12 million to pay for the incentives.
Zomchick said one of the strategies in the plan is to embrace changes at the university.
“Just as automation comes and brings changes in business, higher education also has changes,” Zomchick said. “Changes in the orientation of our research and development, changes also in the orientation of our students. “
When will this happen?
The plan is voluntary, so even though faculty members are eligible, they do not have to participate.
Zomchick said a message will be sent to all eligible professors by next week with more information on the plan. There will be a 60 day training period to learn more about the program from the UT Human Resources Office.
If a faculty member chooses to participate, they must commit to retire by February 15. He has 14 days to revoke this commitment.
June 30 is the retirement date for participating teachers.
In an email obtained by Knox News, Zomchick informed faculty members of the plan two weeks before the presentation to the board.