|
Tom
Hardy |
414 AOB/MC 971 |
| Email News Release |  |
| Download PDF |  |
NEWS RELEASE
January 5, 1010
FOR IMMEDIATE RELEASE
U of I to furlough 11,000 employees, freeze hiring to stem cash crisis
State of Illinois payment backlog threatens University’s budget
URBANA, Ill. — The University of Illinois will make a series of drastic cost-cutting measures – including furloughs and a hiring freeze – designed to trim $82 million from its operating budget to respond to a financial crisis resulting from a $436 million backlog of unpaid state of Illinois appropriations to the University.
President Stanley O. Ikenberry made the announcement in a Jan. 5 email message to University faculty and staff. He called the state’s financial picture “grim and worsening” and said that the situation requires the University to take actions to mitigate the impact of the escalating financial crisis.
Faculty and academic professional staff will take four furlough days – a temporary leave of absence without pay – between the four pay dates of Feb. 16 and May 16. Monthly pay will be reduced by one day for each of the four payroll periods. The president, chancellors and other senior administrators will take 10 furlough days between February and June pay dates. Their pay will be reduced by two days each month during the five-month period.
Exceptions to furlough-day policies include employees whose annual base salaries are $30,000 or less; graduate assistants and fellows; employees with retirement agreements for retirement no later than August 15, 2010; and individuals paid 100 percent from grant or contract funds as of December 16, 2009.
Civil Service employees are not included in the mandatory furlough program. Those employees are covered by layoff provisions of the Civil Service System. Ikenberry indicated that personnel cost reductions for Civil Service employees will be implemented in accordance with Civil Service rules and bargaining obligations.
“We have struggled this year to avoid furloughs for faculty and staff, but that is simply no longer possible,” Ikenberry said in his message to University employees.
More than 70 percent of the University’s budget is for personnel. The furlough program will impact more than 11,000 employees and is expected to save $17 million. All affected employees will participate through automatic payroll deductions. Unit heads are responsible for scheduling furlough days to minimize the impact on the core academic mission and on students and patients. The furlough program is designed to meet short-term needs and is not expected to prevent layoffs.
The action affects employees on all three campuses in Urbana-Champaign, Chicago and Springfield, and their affiliated sites throughout the state.
In addition to the $17 million saved through the furlough program, a 6 percent reduction in expenditures saved an additional $45 million. A 2.5 percent reserve resulted in $20 million saved. The total is the $82 million.
Ikenberry also announced that effective immediately the University is declaring a freeze on all hiring and interim wage increases. Exceptions requiring chancellor and president approval include honoring offers extended before Jan. 4, 2010, commitments required to support specific research and contract activities (e.g. federal stimulus research grant activities), and emergency compensation adjustments.
A previously announced working group appointed to recommend administrative reorganization and restructuring is focusing on possible savings in information technology, purchasing and consolidation of administrative support services. The group is expected to provide an update of its work at the scheduled Jan. 21 Board of Trustees meeting to be held on the University of Illinois at Chicago campus.
The University of Illinois has received only seven percent ($51 million) of its state appropriation since the start of the 2010 fiscal year in July 2009. The amount owed to the university is $436 million as of Dec. 31 and increasing each month.
“At some point we will be unable to meet payroll and complete the academic year unless there are significant payments from the state as promised. My hope is that the Governor, leaders and members of the General Assembly will come together immediately to address the state’s escalating financial crisis,” Ikenberry stated.
More information about the furlough program and its impact is available on the University of Illinois website: www.uillinois.edu/our/news/budget/2010Furlough.cfm
The University of Illinois is a world leader in research and discovery, the largest educational institution in the state with more than 71,000 students, 24,000 faculty and staff, and campuses in Urbana-Champaign, Chicago and Springfield. The U of I awards more than 18,500 undergraduate, graduate and professional degrees annually.
.