The W&M Board of Visitors Tuesday approved the use of temporary personnel actions, including furloughs and pay reductions, if needed for the upcoming fiscal year.
During the Board meeting, university leadership emphasized that personnel actions are not imminent and that thanks to a university-wide effort to reduce spending, William & Mary is in sound financial shape. However, uncertainty remains given the COVID-19 pandemic, state budget decisions and the economy.
“The economic outlook remains sobering and very uncertain,” President Katherine A. Rowe said. “Though we are in a sound financial position now, we have a responsibility to prepare prudently. So we bring parts of a contingency plan and recommend Board action to make additional tools available to us – only to be used if necessary – given the possibilities of the coming year.”
- A furlough is a temporary leave from work without pay. It can be granted intermittently (e.g., one day per week or month) or for a period of time over consecutive weeks or months. During a furlough, employees retain some benefits, most notably health and life insurance.
- A temporary salary reduction is a reduction in pay for a specified time period.
Tuesday’s action delegates authority to the administration should across-the-board personnel actions such furloughs or pay reductions become necessary. If so, decisions will be guided by four principles:
- William & Mary’s core learning mission will be preserved.
- Senior university leaders will be the first impacted and in the largest amount.
- In university-wide actions, we will seek to protect our lowest-paid employees (e.g., those making less than $50,000 annually) to the extent possible.
- The university will look first to temporary actions, not permanent ones.
In response to the pandemic, the administration has already implemented several immediate measures to limit near-term spending. In the spring, the university instituted a hiring freeze, only filling positions that are deemed “mission critical.” Likewise, employees were asked to curtail purchases for the remainder of FY 20 not considered “mission critical,” with the exception of externally funded research expenses. Departments and units are currently undergoing a “zero-based” budgeting exercise for FY 21, which involves limiting expenses not considered critical.
“The Board and I greatly appreciate the leadership of the university for both the ongoing forward-thinking approach to prepare for the financial impact of the pandemic and putting broader contingencies in place in a thoughtful way,” said Rector John Littel P’22. “There are many uncertainties and we must address them in a deliberate, transparent and collaborative way. I have full confidence that is the case.”
If broader personnel actions become necessary, Rowe emphasized the delegation of authority resolution pertains to temporary actions.“The board committed under the William & Mary Promise to achieve more competitive salaries for faculty and staff,” she said. “We have made progress but we are not there yet. This is why it is important that we focus first on temporary actions, in order to allow us the chance – if financial conditions allow – to recover quickly.”