By raising financial benefits for Dartmouth College employees in the 2011 fiscal year, the College has ended its salary freeze for the 2010 fiscal year, Senior Vice President Steven Kadish said in an interview with The Dartmouth. Non-unionized employees who meet or exceed expectations will receive a 1 percent increase to their base salaries for the 2011 fiscal year, and College officials have also agreed to a two-year moratorium on layoffs for unionized employees, Kadish said.
The College will also provide some financial support for unionized employees’ health insurance, Kadish said, and the benefits offered to unionized employees will be “financially equivalent” to the 1 percent salary increase granted to non-unionized employees.
The provost, vice presidents and deans of the College will also have access to a small fund to reward employees’ “exceptional performance” at their discretion, according to an e-mail from Kadish and Provost Carol Folt to the Dartmouth community Friday.
The salary increase comes in light of the College’s recently announced $5.6 million surplus for the 2010 fiscal year.
“We had not built into our budget any type of a salary increase, and we stretched [our budget] in order to do that,” Kadish said.
The increase in wage and salary rates for non-unionized employees will go into effect Oct. 1, and employees will also receive a supplemental payment that will be the equivalent of an increase from July through September, the e-mail said.
College officials have also made agreements with both the Service Employees International Union Local 560 and the theatrical employees at the Hopkins Center for the Arts, Kadish said. These agreements include a two-year moratorium on employee layoffs and financial support for health insurance.
The theatrical employees have already approved the agreement, according to the recent e-mail.
Employees who are members of the SEIU Local 560 will vote on Aug. 6 whether to accept the tentative agreement, Earl Sweet, president of SEIU Local 560, said in an interview with The Dartmouth.
College administrators meet with union leaders weekly, Kadish said. Although the meetings are sometimes cancelled due to scheduling conflicts, College administrators have had to cancel “maybe only once,” he said.
“The union has been really clear about what it believes is important and we’ve been respectful,” Kadish said. “We’ve been very interested in the fair treatment of all our employees, and the union pushed to get some help for health insurance. It was very important to try to create and equitable situation for both [unionized and non-unionized employees].”
The relationship between unionized and non-unionized employees is often very divisive, and the College administration often plays a key role in the division of College employees, according to Phoebe Gardener ’11, a co-founder of Students Stand with Staff — an organization founded in Winter term in reaction to the College’s layoffs.
“I think the union is often villainized because they’ll get things the non-unionized members don’t — and in this case the non-unionized members get something the unionized members don’t — and I think the administration has a role that people don’t always recognize in that divisiveness,” Gardener said.
“We regret not having an announcement on pay increases earlier, but it was critical to understand the year-end savings and revenue trends,” Kadish and Folt said in Friday’s e-mail.
Information about the $5.6 million surplus came from a budget projection at the June meeting of the Board of Trustees, and was based upon financial information calculated last spring, Kadish said.
The surplus came the College’s professional schools, primarily the Thayer School of Engineering, he said.
Although the College had a “relatively small” surplus, budget-reduction measures aim to reduce expenditures over a five-year period, not just the 2010 fiscal year, Kadish said. The College is “on target” to close the $100 million gap over the next two years, he said.
“Last summer and last fall we looked to see not just where we stood for one year but where certain trends would take us for five years,” Kadish said. “Kim insisted on that and the [Board of Trustees] insisted, and when you look at trends of revenues and expenses up through that time, our expenses were exceeding our revenues.”
The College was able to meet its budget goals because of individuals’ efforts to reduce expenses, reductions to the size of the workforce at the College and healthy endowment projections, Kadish said.
Although a number of vacant positions were eliminated rather than being filled with new employees, the College is now in a “normal hiring mode,” Kadish said.
Current projections show that the College will meet or exceed its endowment distribution, although the endowment is “completely out of our control,” Kadish said.
“This has been a terrific year to deeply understand what our financial situation is and to begin to take some very serious actions and all of these actions will help us address the $54 million gap for next year and even the $100 million gap in the following year,” Kadish said.
College officials do not currently plan to award any other financial benefits to College employees, Kadish said.