On Friday, Provost Krendl and Vice President Decatur sent an e-mail to the Ohio University community about changes to employee health care contributions that are currently being considered by Budget Planning Council (BPC). That group has already recommended the $1 million proposal to cut health care costs developed by the Benefits Advisory Committee and continues to consider further health care cost shifts in two scenarios totaling $3 million and $5 million. Because BPC is almost certain to recommend 0 percent salary or wage increases for the coming year, these additional cost shifts on health care would result in a decrease in total compensation for all university employees. Employees will have less in their paychecks and have to pay more out of pocket for deductibles, co-insurance and office visits.
In their communication, Krendl and Decatur argue the savings we achieve on health care costs will reduce the number of layoffs at the university. In drawing this direct relationship between cost increases and job losses, they suggest that opposing these reductions in employee compensation will cost people jobs. It's not that simple.
Our university, over the past five years, has seen unprecedented increases in executive compensation. There has understandably been much media attention paid to the 23 percent raise received by the president this year. However, the university has also substantially increased the salaries of vice presidents, deans, associate VPs, and some athletic coaches. Administrators have been hired at significantly higher salaries than their predecessors received. We have witnessed a proliferation of highly paid new administrative positions in the Provost's Office, Shared Services, etc. These increases in executive compensation are substantial and, just as much as rising health care costs, impact the university's ability to balance its budget and avoid layoffs at the present time.
Meanwhile we have been told that increases in faculty compensation will be implemented according to a five-year plan (now on hold). At the same time, most administrative and classified employees are still waiting for their plan.
Provost Krendl and VP Decatur are certainly correct in citing rising health care costs as one of the ingredients contributing to our difficult budget situation. Nonetheless, it is misleading to single out this piece of our budget as the reason for potential layoffs. It is even more unfair to erode the compensation of all employees, close on the heels of a period when a few dozen members of our community have received such exorbitant raises.
Joe McLaughlin is the chairman of Faculty Senate's Finance and Facilities Committee.
4 Opinion
