Harvard Offers Staff Early Retirement to Reduce Expenses
Harvard University is asking employees to consider a series of voluntary measures, including early retirement.
(Bloomberg) -- Harvard University is asking employees to consider a series of voluntary measures, including early retirement, giving up vacation and reducing work hours as it faces a revenue shortfall of $1.2 billion over two academic years.
The Ivy League school is also extending pay and benefits beyond June 28 for directly employed staff and contract workers whose work has been idled because of the coronavirus pandemic, such as dining, custodial and security workers, executive vice president Katie Lapp said in a statement Tuesday. The school isn’t considering furloughs or layoffs, she said.
Colleges including Harvard are grappling with how to resume classes in the fall semester, either online or in person, amid worries of a second wave of the coronavirus pandemic. U.S. schools face an economic squeeze from less tuition if fewer students decide not to enroll and loss of room and board revenue if they can’t return to campus. At Harvard, a limited number of workers have been reporting to campus in essential on-site roles, and the university is restarting its laboratory facilities.
Harvard “will not be pursuing any furloughs or layoffs of our employees at this time,” Lapp said. “We will continue to assess the effectiveness of the voluntary programs and other cost-saving measures we are enacting to determine if we can continue to manage budget shortfalls or if we need to consider other steps, including workforce actions, in the future.”
Under the Cambridge, Massachusetts, school’s plan, eligible workers who take the early retirement buyout get an additional year of pay. The vacation option enables permanent employees to spend down their accrued time to help trim costs for their departments. Under the work-hours program, staff can cut back their time from 10% to 50% for a minimum of two months if their manager approves.
Harvard, with an endowment valued at $40.9 billion in June 2019, is the richest U.S. University.
“We have not made a decision yet whether or not to bring students back or how many to bring back,” Harvard President Lawrence Bacow said last week in an interview with Bloomberg Television. “We’re trying to delay that as much as possible.”
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