Tuesday, July 08, 2008
Interestingly, nobody ever calls this age discrimination, which is what it is. (It clearly has a 'disparate impact' on younger workers. How many credentialed professionals currently under 40 were working there fifteen years ago? I thought not.)
These tiers were the result of collective bargaining. They were a way to cut future costs without hurting present employees. Of course, time has a way of passing, and now some of those unnamed (and unrepresented) third party folk are actually on staff.
Or, increasingly, not. It seems that new employee retention has mysteriously nosedived since, well, the latest round of tiers went into effect. It's most pronounced among staff, as opposed to faculty, probably because staff aren't eligible for tenure, which is a lure of its own.
Apparently, the college can't compensate for the higher deductions by offering higher salaries, for fear of triggering complaints of 'salary compression.' If you look only at salary, and not at take-home pay, the objection holds some water. But x minus five is more than (x plus two) minus ten, so in terms of take-home pay, it's misplaced.
Worse, the disparity becomes progressively harder to 'fix' over time, even if one were so inclined. Any move to raise the effective compensation of the disfavored group would immediately bring calls for retroactivity, which is a headache beyond words. And as the gap grows, the cost of filling the gap grows with it. Right now, that cost is simply passed along to newer hires, who swallow it in the form of lower take-home pay.
Judging by the turnover of younger staff, the combined pincers of 'tiered benefits' and 'no salary compression' have pushed take-home pay to below market-clearing levels. This is not good.
Although some might read this as an anti-union post, I don't think it is. My preferred solutions are either to go with national single-payer health care for everybody and be done with it, or, failing that, for the union to adopt the Rutgers faculty union model of actually having incumbents make some level of sacrifice for the sake of their future colleagues. Either way, the goal should be precisely to get away from invidious distinctions among employees based on age. Tiers aren't solidarity; they're sellouts. They defeat the purpose of unions, and make administrators' jobs harder, too. No, thanks.
Instead of my preferred solutions, though, I foresee the tiers getting steeper, and colleges compensating with an unsatisfying combination of efficiency drives, reorganizations, and lower quality. Yuck, yuck, yuck.
I honestly hope I'm wrong on this one.
The irony is that when it comes to preserving retirement benefits, particularly health care for retirees, eventually it will be these yet to be hired members making decisions while the retirees have no say. Be careful what you do to preserve your own benefits - you won't be there forever, and it will be up to the next generation to preserve them for you.
Though I'd argue that we also have inequity built into the system when my married colleagues with children are given tuition breaks for their kids, which is a benefit I, as a single, childless person, can never access. I'm not attacking families, but saying that there is inequity when I and a colleague who is a parent each get different financial benefits for doing the same job.
Of course, the union leadership is (and has been) maxed out on the salary scale for some time, so they don't think it is a problem -- tell that to the worn out CC faculty who knows the newbie down the hall makes $15,000/year more....
If faculty members have learned these hard lessons because grey-beard union leaders have been feathering their own nests, then elect new union leadership, or decertify the old union and get a new one.
Unions aren't bad, but that doesn't mean there are no bad unions.
At my institution, more senior faculty (and professional staff) have a TIAA-CREF contribution (entirely the university's) of 15%. Current hires--10%.
We don't have the health care differentials, though.
That choice was a way for the COLLEGE to cut future costs without hurting the members of the group they were bargaining with.
I would say that the COLLEGE chose the easiest option for them. You didn't say if the proposal came from the faculty or the administration in that particular case, which would be an interesting thing to know. It does have a big advantage for the college's lawyers in that it doesn't change a promise made when the existing faculty were hired.
The reason it is not age discrimination is because it treats all ages equally. A new hire at age 50 agrees to that contract over the other ones to choose from (probably zero to choose from) while a 20 year veteran at age 50 has a much better deal from a time when benefits had to be higher to attract the same caliber instructor.
It would appear that admin has suffered the most, because of staff turnover among those who have employment options. Admin would suffer more if there was not a surfeit of supply of faculty.
By the way, it can work the other way. In my state, contributions to a 403(b) retirement alternative are much bigger now than in the past (corrected for inflation) because the retirement system had to make up for being underfunded. Employees who left got less than they should have.
Accepting tiers is partly about short-sightedness on the part of the unions, but it also works because this tactic effectively splits the union rather than all members wanting exactly the same thing --- it preys on members' fears of being out on strike too long and their "well I'll have my benefits at least" mentality. It is, therefore, a more subtle and delayed form of union-busting --- or union-weakening as the case may be.