Salary and Wage Increase Update - 2009 Budget Reduction Process


Today we are distributing to Deans and Directors the guidelines for implementing salary and wage increases for the coming fiscal year for UNL faculty and staff. A salary increase pool of 1.5 percent for faculty and staff has been approved. Raises associated with faculty promotions need to be accommodated within the total salary pool. This leaves 1.16 percent available for general increases for faculty. The staff increase pool remains at 1.5 percent. A recent memo from President Milliken indicates that the funds are not to be used for across-the-board increases, but rather to address issues of competitiveness. The funds allocated for salary increases must be used for salaries and may not be used to reduce budget deficiencies. I realize that the competitiveness of our salary structure to recruit and retain top talent for both faculty and staff positions differs from unit to unit. Because the average increase is small, I am giving the entire increase pool to the Deans and Directors to distribute through the departments. We have asked each Dean and Director to provide us with a justification of how his or her allocation among departments complies with the competitiveness guideline, and each chair or head will be asked to do the same for allocations among faculty and staff.

There is some good news related to benefits this year. The university will cover the projected Jan. 1, 2010 increase in health insurance premiums for participating employees. This represents a real savings for employees who will not be responsible for a previously planned increase in employee contribution to the health insurance plan. The benefit to each employee for health insurance will range from $60 to $190 per year. Also, the university will add an expanded life insurance benefit equal to one year's base salary, up to $120,000, for full-time benefits-eligible employees. The value of this benefit varies depending on the employee's age and salary level, but the average cost to the university for providing this coverage is approximately $200 per year, per employee. These benefits changes are effective Jan. 1, 2010, and neither will have income tax consequences for faculty or staff.

The deadline for Deans and Directors to return information about faculty and staff pay increases is Friday, June 12, which will allow time for our budget office to process the information for July 1 implementation.

Many of you, both faculty and staff, have suggested that we forego salary increases this year in order to minimize the amount of our budget cuts. I have carefully considered this possibility, and honestly, have changed my mind several times. In the end, I support providing this increase out of concern for keeping a competitive university salary structure. Because of other steps that have been taken, I believe the budget cuts we will face will be considerably more moderate than what we earlier expected, but confirmation of this awaits the Board of Regents' adoption of the budget on June 12. My intention is to notify the campus as soon as possible thereafter about what cuts I will be recommending, even though they may not be implemented until fall after the Academic Planning Committee reviews them and holds hearings for those impacted. I have consulted with members of the Academic Planning Committee about this process.

This has been a very stressful and uncertain time for all of us. The same is true in the general economy. There is some comfort in the fact that our university is avoiding some of the draconian measures that are being faced by our colleagues elsewhere. As always, thank you for all of your comments and suggestions, and your support.

Harvey Perlman