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SPPC Recommendations on Retirement: 1 Percent Across the Board

By Jody Record, Campus Journal Editor
March 23, 2011

Representatives to the System Personnel Policy Committee have recommended the USNH board of trustees cut 1 percent systemwide from USNH retirement contributions for nonunion employees for a savings of $1.8 million.

The SPPC met March 17. The board of trustees’ administrative board will review the recommendation and alternative strategies before voting on March 24. Whichever plan is approved will become effective July 1.

Prior to coming to a consensus on the recommendation, SPPC representatives discussed basing retirement contributions on years of service, and having annual caps and lifetime caps on contributions. Feedback from the four campuses was received from constituents through e-mails, open forums, and surveys.   

According to a memo from David Proulx, interim assistant vice president for Human Resources, the SPPC had several concerns about basing retirement contributions on longevity. Among those noted:

  • Only 30 percent of current USNH nonunionized employees would bear the impact of the $1.8 million reduction. 

  • The reduction for newer employees would not be able to be made up in the future.

  • From a recruiting standpoint, the significant reduction in the match for new employees would competitively disadvantage USNH.

  • A greater gap between unionized and nonunionized employees would be created.

The committee recommended a third retirement contribution level that would have employees paying 4 percent and USNH contributing 6 percent. Currently, nonunion employees can elect to forgo a USNH retirement plan, contribute 2.5 percent with a 6 percent match from USNH (includes 1 percent Additional Retirement Contribution (ARC) if elected), or make a 6 percent contribution with an 11 percent USNH match.  (Employees who did not elect ARC have a 10 percent match).

Regarding pending changes to health care benefits, from which $2 million must be trimmed, a subcommittee was appointed to explore possible options and their impacts.  The subgroup will report to the SPPC on April 12. 

An open forum to discuss redesigning the nonunionized employee medical plan will take place April 13 from 10:30 a.m. to 12:30 p.m. in the Strafford Room at the MUB.  

The SPPC will meet May 19 to review suggestions and pass on a recommendation to the administrative board, which meets May 26. 

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