Staff and Students React to Possible Health Care Cuts

Three weeks ago, College Treasurer Suzanne Welsh and Vice President of Human Resources Melanie Young held several meetings for staff to discuss the college’s financial situation and possible cuts to staff salary and benefits. Students and staff were alarmed by the potential cuts to health care benefits.

Last Sunday, a group of concerned students met to discuss these possible cuts and how to influence the administration’s decision. The meeting was organized by Dermot Delude-Dix ’10 who first became involved when he spoke with a concerned staff member. Maurice Weeks ’09 noted “We [students] realize we are only part of this, it is about the staff.” Delude-Dix clarified the group’s purpose by stating, “We are not claiming to speak for the staff, or lead this. We try to take direction from the staff wherever we can. We recognize that we are in a privileged and strategic position to pressure the administration because our jobs and health care are not threatened.”

The staff were not initially aware of the purpose of the meetings with Welsh and Young. Young’s notification email stated the meeting’s purpose was to “provide additional background information on the finances of the College which will help us continue to discuss the situation, including the recommendations from the ad hoc committee on financial planning that will be developed later this year.”

The meetings opened by discussing the recent endowment losses and then planned and possible budget cuts. “The information was so overwhelming with all the facts and statistics. To me they hinted most at cutting health care benefits.” said Education Department Administrative Assistant Kae Kalwaic, who was present at all three meetings.

The most significant cut discussed was the benefit bank. The benefits bank is a Swarthmore College fund that allows employees to choose between a premium health care plan and a cheaper health care plan. If an employee chooses lesser health plan, the college then pays the market difference in price to employee. The majority of staff opt for the cheaper health care plan, allowing them an extra $1400 on average in take home pay.

Eliminating the benefit bank would impact staff disproportionately. For the lower pay grades, $1500 pay cut represents a 2-5% loss in take home income. These lower pay grades include Dining Services, Environment Services, and Administrative Assistants. Kalwaic noted, “if I made over $100,000 I wouldn’t be concerned at all about losing the benefits bank.”

Young stressed that “everyone agrees that pay and benefits must remain competitive in order for the institution to continue to be strong, so I have to believe that any changes would preserve our comparisons with the market.”

The student response is still in the preliminary planning stages. A major issue in organizing opposition is the uncertainty surrounding the actual cuts. “Because any cuts are not definite, it is hard to organize since we do not know exactly what to oppose.” said Kalwaic . “It is difficult to suggest alternatives because the administration refuses to make budget transparent. If we cannot see why specific cuts are necessary then there can be no administration accountability,” said Delude-Dix.

“With a billion dollar endowment still, cutting health care is a choice, not a necessity, especially when you consider the exorbitant salaries the college pays. Al Bloom makes over $500,000 while cutting [benefits banks] would save $600,000.” Delude-Dix said. Haverford College President Stephen Emerson recently announced that he would be giving back 10% of his salary to minimize the need for staff reductions. “The college was planning on cutting this five years ago even before the current endowment crisis during the Living Wage Campaign,” said Maurice Weeks.

The college has also held meetings with faculty about possible cuts. Professor Barry Schwartz said that “the faculty has been engaged in conversations about prioritizing 10-15 million in cuts, should that become necessary. People seemed to agree that salary cuts were referred to benefit cuts, and that salary cuts should be targeted disproportionately to the highest paid people.”

Any final decision will not be made until next year. At this point, the Faculty/Staff Benefits Committee and College Budget Committee are making recommendations about the benefits. The final decision will be made by the President and the Board of Managers. Professor Schwartz urged restraint, stating, “The fact that something gets mentioned as a possibility does not mean that it will end up as a candidate for cuts, or even that it will be given serious consideration as a candidate for cuts.”

Any student interested in more information or getting involved should contact Dermot Delude-Dix.


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0 comments

  1. 0
    Jenny Akchin says:

    In answer to these comments–essentially the decision will be made in December by the board of managers and the financial planning group and will effect the budget for 2010-2011, should economic circumstances remain as they are or worsen. While no one has indicated that health care benefits will be cut, they remain on the table along with a number of other budget cut proposals. This is not a "hint," as administrators on the FPG have explicitly said that health care benefits cuts ARE and continue to be "on the table" for next years budget cuts. So while there is no evidence that this will definitely happen, its certainly not a completely unfounded concern.

  2. 0
    Jeffrey Lott ( User Karma: 0 ) says:

    This report is premature and unnecessarily alarming. It is based on "hints" rather than facts. Let's wait until we hear what the Board of Managers decides this weekend about the 2009-2010 budget before manning the barricades.

  3. 0
    swat '09 says:

    "Students and staff were alarmed by the potential cuts to health care benefits."

    Alan, what facts do you have to back up the claim that the administration is considering health care benefit cuts to staff? I have heard this is a rumor with no foundation to it.

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