Paid to quit

Lane employees offered separation incentive.

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The college has implemented a new separation incentive for classified employees. Classified employees are hourly workers and members of the Lane Community College Employees Federation the incentive is available for staff that work half-time or full-time.

Lane is currently experiencing around an $11 million budget gap, meaning the college is spending more than the revenue it generates each year. Due to the budget gap, the college is reducing workforce. The early separation incentive creates an alternative to involuntary lay-offs.

“We’ve used this as a tool to balance the budget,” Lane Chief Financial Officer, Greg Holmes said.

The agreement between LCCEF and the Board of Education has been in effect since 2015. Each year an updated incentive is released. This year it applies to employees hired on or before July 1, 2012. Since 2015, the incentive has offered the choice between a lump sum payment or health insurance continuation. Tuition waivers and transportation fee exemptions were added to the 2017 incentive. Employees who take the incentive this year must submit their notice of voluntary separation by March 31 and separate by June 30, 2017.

Employees typically arrange a series of meetings with a representative in Human Resources in order to make sure that the incentive is really a good choice for them. Many employees who have taken the incentive since 2015 have done so for retirement.

“For many employees it’s a way of them transitioning, ‘cause there’s a period of time, especially when you retire, you don’t get your retirement right away, so it helps them bridge that period of time,” Human Resources Manager Sharon Daniel said.

Classified staff who choose health insurance continuation receive coverage for up to 12 months after the separation occurs. Employees are still required to pay their portion of the premium.

Those who opt for the lump sum receive a one-time stipend of $10,000. This is an increase from the separation incentives from 2015 and 2016 of $9,000.

All employees have access to the LCC Health Clinic for one year, given that they pay the required fee. One dependent is also eligible for access to the clinic. In addition, employees who separate will still be eligible for the employee-only tuition waivers and for transportation fee exemption for wellness related classes through June 30, 2018.

“I think it works for both parties pretty well. This is our third iteration — we added the tuition waiver option and the transportation fee exempt class option,” union representative Alen Bahret said.

Since the system is voluntary and not targeted at certain classified staff, some departments get hit harder than others. For example, in 2015 a large portion of the enrollment services staff opted to take the incentive. This meant that there were several positions that would need to be filled and trained.

“It’s not a very strategic way of doing it, but it’s a less painful way of trying to reduce your workforce,” Holmes said.

Filling vacant positions is handled differently on a case-by-case basis. The least expensive option for the college is to shift staff from a different department into the vacant position, and have them trained by the staff. Another option is to bring in a new hire, and sometimes the college will bring back the separated employee on a part-time basis to help train their replacement.

Overall, the incentive generated a net positive effect. For the 2015 fiscal year, the college saw 34 total separations, 13 of which were positions that needed to be filled afterward. This saved the college $909,000. Success was higher in 2016 with 40 total separations, 21 of which needed to be filled. The net savings for the college was a total of $1 million.

If the incentive continues to be successful, classified staff can expect a new incentive next fiscal year.