MINUTES

EMPLOYMENT BENEFITS COMMITTEE

March 11, 2010

Members Present

Don Clothier / Darryl McCullough – Vice Chair
Debbie Copp / Scott Moses
Alisa Dougless / Sue-Anna Miller
Brenda Freese - Chair / Jannie Porter
Suzanne Gilmore / Will Wayne
Chad Johnson / Justin Wert
Frank Lawler
Members Absent / Other Attendees
Barbara Abercrombie / Ladonna Sullivan
Don Harrison / Theta Dempsey
Simone Pulat

Ex Officio Members

Julius Hilburn

Nick Kelly

The meeting was called to order by the Chair at 1:30 pm.

I.  Approval of Minutes

·  The February 2010 minutes were approved with no changes.

II.  Defined Contribution Plan

·  As decided in the February meeting HR prepared additional scenarios for the Committee’s review and consideration. Julius began with a discussion about the need to reduce benefits cost, and some background on why HR began modeling defined contribution scenarios, rather than other programs, to absorb the impact of potential reductions to benefit spending.

·  Scenarios were presented which outlined the potential cost savings using the following programs:

·  Voluntary reductions in FTE/Unpaid Leaves

·  Phased Retirement

·  Early Retirement or Termination Incentives

·  Benefit Reductions

·  Furloughs

·  Voluntary Leaves

·  Reduction in FTE

·  Voluntary furlough

·  Unpaid leave of absence

Question: What happens to benefits if someone were to take a voluntary leave of absence?

Response: Julius told the committee that a voluntary plan could be designed which would allow benefits to continue. He also stated that based on research of other universities offering voluntary leaves, they are generally offered in conjunction with other programs.

·  Phased Retirement

·  Current program is phased over 10 years. A new program would be established to reduce FTE over 1 to 3 years.

·  Could have OTRS impact. Retirement benefit would not be reduced, but would not increase either.

Comment: Several committee members voiced the opinion that a phased retirement program, if offered, should include staff as well as faculty.

·  Retirement Incentives

·  OU would determine what employees and/or employees are eligible

·  Savings would only be realized if departments agreed to a permanent reduction and vacated positions are not filled, or if hiring of replacements is aggressively managed

Comment: Several committee members expressed concern that a retirement incentive program may be too risky.

·  Furloughs

·  Savings will be immediate

·  Employees’ take home pay will be affected

·  It would take 7 to 8 furlough days per employee to achieve the same level of savings as the DC reductions

·  The number of furlough days could increase or decrease depending on whether they are administered through a tier system, and if certain employee classes (i.e., grant funded, clinical, etc.) are excluded

Question: One committee member asked what would happen to health insurance costs, due to potential shifts in tiers for employees, in the event of a furlough.

Response: Julius indicated that employees on the line between two tiers would not be moved to the lower tier because of a furlough, so, there would not be an increase in university contributions.

Question: A committee member inquired as to whether or not temporary workers would be needed to replace critical functions during the furlough period.

Response: Julius told the group that all issues such as this would need to be addressed prior to implementing the program.

Comment: It was the opinion of one committee member that given what is currently known about the situation and the caveats in the EBC recommendation to President Boren, the DC reduction appears to be the better option.

Comment: Julius stressed to the committee that it is currently unknown how long any recommendation to President Boren will be in effect as the full budget impact is still uncertain.

Comment: There was significant discussion about the apparent faculty preference for furloughs vs. the staff preference for the DC reduction. One faculty member on the committee indicated that faculty opinion may shift if there were to be a timeframe, such as 1 year, stipulated in the recommendation.

Question: A committee member asked if there is any indication from the President’s office whether the $4M savings directive for the Norman campus will change.

Response: Julius indicated that the budget situation changes monthly and HR will continue to seek direction from the administration. He also clarified the statement by informing the group that the severity of the budget constraints may vary between Norman and HSC.

·  Defined Contribution Plan Reductions

·  The EBC has recommended that if DC reductions are necessary, an across the board approach is best

·  Employees’ take home pay would not be negatively impacted

Motion: A motion was made by Debbie Copp to amend the memo sent to President Boren to include a stipulation that the 20% reduction to DC, if necessary, be reevaluated on an annual basis. Justin Wert moved to second the motion. Prior to all parties voicing a vote, Don Clothier made another motion to table the motion made by Debbie. Scott Moses moved to second the tabling motion and the Committee voted to approve.

III.  Updates from the Chief Human Resources Officer

·  There were no additional updates

IV.  Other Business

·  There was no other business

The next EBC meeting will be Thursday, April 15, 2010.

There being no other business, the meeting was adjourned at 3:35 p.m.