Continuing deterioration of compensation and benefits

A year ago, the Berkeley Faculty Association drew the attention of faculty across the ten campuses of the University of California to the continuing degradation of their pensions, benefits and salaries.

Faculty were, they noted, still underpaid in relation to their peers at competitor institutions. Despite this salary gap they were being increasingly asked to pay more but get less from their health insurance and pensions. Moreover, the introduction of a new and less generous pension ‘tier’ for those hired after 2013, last year’s chaotic roll out of the new health plans with the prestige UC Care option working only on campuses with medical schools, and the cutting adrift of out of state retirees from all health plans with a good luck lump sum payment of $3,000, created new inequities between UC faculty.

This analysis has recently been confirmed by UCOP’s own study of total remuneration. The executive summary of this document contains the following depressing bullet points:

• Between 2009 and 2014, UC’s total remuneration fell from 2% below market to 10% below market.

• Health and welfare benefits fell from 6% above market in 2009 to 7% below market in 2014, primarily caused by higher medical employee contributions at higher salary bands compared to the market.

• Changes to retirement plan designs since 2009 reduced positioning against market from 29% above market to 2% below market.

• Total retirement decreased from 33% above market to 6% above market.

• Total benefits decreased from 18% above market to 1% below market.

It is the first UCOP study to compare the new (2103) and old (1976) tier benefits for UC faculty with equally depressing results.

• New tier retirement benefits (the defined benefit plan) are valued 16% below old tier retirement benefits.

• New tier retiree health benefits (medical, life, dental) are valued 23% below old tier retiree health benefits.

• New tier retirement benefits (defined benefit plan plus retiree health) are 17% lower than the old tier.

In short, we have moved to a new system where the old deferred benefits of our pension and healthcare helped offset lower salaries to one in which the cash compensation of salaries still lag behind our competitors and in addition benefits have now also been reduced to a point where they are below comparable institutions. In 2009 UC cash compensation by salary represented 68% of total remuneration, yet for assistant professors in 2014 it represents 86%.

The IFA and the Council of UC Faculty Associations (CUCFA) believe that it will be difficult to retain and protect the quality of UC faculty if their salaries remain uncompetitive and their benefits and retirement packages continue to erode.

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