N.C. House bill would give UNC-System president power to cut salaries across the board

The North Carolina General Assembly is attempting to give the UNC System greater flexibility to deal with COVID-19 financial impacts by granting the UNC-System president the power to implement temporary across-the-board salary reductions and layoffs. 

House Bill 243 passed unanimously in the House late last month, and it has since moved on to the Senate. Along with an early retirement incentive program, the salary-reduction powers would be granted to President Peter Hans, with the potential to be delegated to chancellors, raising concerns about faculty pay and the president's power. 

Mimi Chapman, chairperson of the faculty at UNC-Chapel Hill, said the devil is in the implementation, since the way that power ends up being wielded and the respect the system shows for individual campuses is a question that is concerning to people.

“Having more local control at the campus level is a good thing as long as the folks at the campus level — the administration — is listening to the voices of faculty, and staff and students as they make budgetary decisions,” Chapman said. “In some ways, the legislature creating more flexibility, that's not a bad thing.”

She said she does not like the idea of the System making across-the-board decisions that could affect UNC-CH in the same ways as other campuses that are situated very differently. 

Becci Menghini, vice chancellor for Human Resources & Equal Opportunity and Compliance, said at the March Faculty Council meeting that the bill was drafted several months ago along with the System office’s legislative priorities. 

She said the bill seems scarier than it actually is since it just provides tools that could be used if necessary moving forward.

Menghini said in a statement to The Daily Tar Heel that the University does not expect to conduct broad furloughs, layoffs or across-the-board salary reductions.

“Because of the early mitigation steps the University took at the start of the pandemic, such as only filling critical vacant positions and closely reviewing spending requests, and the hard work of units across the University to enact budget reductions in a strategic and thoughtful manner, we don’t expect to need to use such blunt tools,” Menghini said. 

Matthew Brody, senior vice president and chief human resources officer for the UNC System, said in a statement that with the pandemic still active, the System wants to be prepared for any future unanticipated developments.

“The hope is that we will not need to resort to any of these measures and in fact, among the University’s highest legislative priorities is an increase in pay for our faculty and staff,” Brody said. “So certainly, we would avoid implementing salary reductions to the greatest extent possible. The possibility of any such reductions looks to be very remote, if conditions with respect to COVID-19 continue to improve.”

N.C. Rep. Verla Insko, D-Orange, said in a statement that the processes granted by the bill would only be used during declared emergencies — but she was not in favor of the UNC-System president acting alone.

Existing salary concerns

Deb Aikat, an associate professor of journalism, said he is bothered by the spirit of the legislation.

“I think these laws are made by legislators who don't have a sense of the reality that exists in our higher education first,” Aikat said. “We have been cut to the bone. Now you are cutting my bone — I can't even stand.”

Aikat said potential cuts to faculty salary are self-defeating, as many of his colleagues have left for other schools that offer them higher pay.

“Every day, we are doing more with less,” Aikat said. “Our faculty haven't had a sizable raise, or any raise for that matter, for the last three years.”

Data presented to faculty in December 2019 showed that full professors at UNC earn about $19,000 less on average than faculty at peer institutions.

Aikat said he thinks the legislature should look at potentially increasing in-state tuition instead of making cuts to faculty.

Brody said that pay increases for faculty and staff has been one of the System’s highest legislative priorities.

Early retirement option

The bill would also authorize the UNC Board of Governors to adopt an early retirement incentive program. Those eligible could receive a severance package equal to at least one month’s annual base salary but no greater than six months. 

Menghini said it would be a voluntary program that could be used as a cost-savings mechanism moving forward. 

“I would imagine that having an option for early retirement might be appealing to some people,” Chapman said. “It would give professors more choice.”

The authority for the early retirement program as well as salary reductions would expire December 31, 2022.

Chapman said that just talking about these tools raises people’s anxiety, but it is important to have conversations.

“Recognizing that this is a big institution, my goal is always just to make sure that there's a lot of voice and a lot of participation, and that people are really hearing the concerns of all of the different constituencies on campus as they make any kind of decision that is going to affect people's lives and well-being,” Chapman said.

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