Report recommends scaling back fringe benefits

In a few years, University employees may be denied full tuition compensation for themselves and their children, as the administration looks to correct a widening gap between fringe benefits expenses and resources.

According to a 38-page preliminary report released by the Task Force on Fringe Benefits, which is co-chaired by Provost Claude Steele, Executive Vice President Robert Kasdin, and Dean of the Faculties for Health Sciences and Medicine Lee Goldman, future University officers may be looking at limited tuition benefits, a vesting period to accumulate retirement benefits, and increased copays, deductibles, and coinsurance for healthcare benefits.

At Columbia, compensation for employees comes in the form of salaries and fringe benefits, and ever since the 2008 financial crisis, the central administration has been exploring ways to reduce the cost of fringe benefits, which began increasing faster than revenue in recent years. The Task Force on Fringe Benefits, which includes University officers from various departments and schools, formed in August 2010 to assess potential cuts.

In an email sent to benefits-eligible officers last week, Steele, Goldman, and Kasdin wrote that the task force hoped to incorporate the opinions of the community into its recommendations.

“We would like to thank the Task Force members for their diligent and thoughtful work. They have met the dual challenge of proposing a set of programs that will help the University continue to provide high-quality, competitive benefits while addressing the financial imbalance that has developed in recent years,” the email said.

Engineering professor Paul Duby chairs the University Senate’s Task Force on Fringe Benefits, separate from the administration’s task force. He said he was concerned about the costs of the lower contribution, high-deductible healthcare plan that the report recommends implementing for all University employees.

“There are no numbers on the healthcare, so that’s a question that’s not answered ... You know healthcare costs have been going up, so most likely the cost of healthcare will increase, and there’s no number on that, there’s no information on that,” he said.

To finance fringe benefits, the University charges schools and departments for a percentage of their employee’s compensation and then combines the money together into a “fringe pool.” According to the preliminary report, the fringe pool is expected to run an annual deficit of $25-35 million, after the pressures of the economic downturn reduced the rate of growth in fringe revenue.

According to the email from Steele, Kasdin, and Goldman, the task force suggested introducing grandfather clauses wherever possible in order to guard current University officers against the new set of changes. The report recommends that officers hired before July 1, 2011 maintain their child-related tuition benefit program and tuition exemption program, which allows them to enroll in courses in Columbia’s undergraduate and graduate schools for free. Officers hired after that date would be given tuition benefits for just one child, and only 80 percent of their undergraduate degree tuition would be covered.

Duby said the report does not list information about the other universities’ benefits packages, which it claims to have surveyed. He said he and others worry changes to the benefits packages will make recruiting faculty and staff more challenging.

“They say it will remain competitive, but I don’t know.”

Sammy Roth contributed reporting.
leah.greenbaum@columbiaspectator.com