July 10: CSU's Answers to Furlough Questions

We gave the CSU the opportunity to read an advance copy of this document, and they edited some of the answers so that they accurately reflect their responses.

Furloughs – Questions and Answers

July 10, 2009

Q1. In addition to furloughs, what are some of the other cost-cutting options the CSU is considering?
A1. Chancellor Reed has said, “Everything is on the table.” On July 7, Executive Vice Chancellor Ben Quillian told the CSU Board of Trustees that some of the measures under consideration include reduced student enrollment, freezing salaries, restricting hiring and travel, restricting purchasing, examining fees charged, evaluating systemwide contracting, and eliminating duplications of effort

Both at the bargaining table, and during the Board of Trustees meeting, the point was made that reductions in student enrollment will not take place overnight and are unlikely to have any major impact until fall 2010. However, given the level of reductions in student numbers that are being planned (about 30,000) for 2010/2011 the administration is being clear that a restructuring on this scale will have an impact on the levels of staffing that will be necessary to deal with a significantly reduced student population. Reducing the numbers of students by itself does not reduce operational expenses; in fact, it actually reduces revenue because the CSU will not receive fees from those missing students. The reduction in expenses will eventually come from a reduced need to service those students across all sections of the University, including faculty, staff, and administrators. This reality is one of the primary reasons why the University has been unable to provide any guarantees that there will not be lay-offs during the operational period of any furlough program.

Q2. What is the current position regarding furloughs of each union representing employees in the CSU?
A2. 

1 – UAPD, physicians	On July 1, UAPD advised CSU it wasn’t interested in negotiating furloughs. As of July 7, however, UAPD has indicated that it is reconsidering its position.
3 – CFA, faculty	CFA is in the process of polling their members before negotiations.
4 – APC, counselors	APC is in the process of furlough negotiations.
6 – SETC, maintenance trades	Unit 6 has no contract in place, and the CSU is in full bargaining with them. Their executive board has voted against furloughs. The CSU proposed either furloughs or a 10% permanent reduction in salary. CSU and SETC are in fact-finding.
8 – SUPA, police officers	The CSU has stated that all Unit 8 employees will be exempt from furloughs.
10 – IUOE, Maritime operating engineers (CMA campus only)	IUOE has advised the CSU they are not interested in a furlough option.
11 – UAW, Academic student employees	The CSU has stated that furloughs do not apply to Unit 11 academic student employees due to the way that these employees are hired which means that campuses can match the number of individuals hired into positions with the funds available to support those positions. ,
12 – CSUEU, Head Start (S.F. State campus only)	The CSU has stated that unit 12 employees will not be subject to a furlough, given that they are funded from a federal grant.
13 – CSUEU, extended education ESL instructors (L.A. campus only)	The CSU has stated that unit 13 employees will not be subject to a furlough, given that they are funded from extended education. Unit 13 employees are in full bargaining with the CSU and have no contract in place. Mediation failed to produce an agreement. The parties will be going to fact-finding.

Q3. Is there a deadline by which an agreement must be reached?
A3. The Chancellor has said that he will announce the full plan to deal with the budget deficit following the Board of Trustee meeting on July 21st.

Q4. What impact will decisions of other unions have on any such deadline?
A4. The campuses have been instructed to prepare plans to deal with the $275 million in  compensation savings that the Chancellor outlined at the last Board of Trustees meeting.  Campuses are not “waiting” to see what other unions decide on furloughs. Planning  will proceed on the basis of how things stand at this moment in time.

Q5. Has the CSU considered bargaining a statewide template which allows for local campus options?
Q5. Although the CSU would like a statewide agreement, campuses are unique and have their own needs. The way to deal with this is to negotiate as much flexibility into the Program as possible to allow the campuses to tailor the Program to meet their own individual needs.

Q6. If so, does the CSU envision campus-by-campus impact bargaining or regional bargaining?
A6. No. We can have consultation on the campuses, but we want to address central issues at this table.

Q7. Do campus Academic Senates have to approve changes to the academic calendar associated with possible furloughs? If so, how will the Senates be integrated into the decision-making process, and how will that affect collective bargaining?
A7. As the University goes about the planning that the Chancellor has ordered, the Academic Senate will be consulted in the usual course of events in relation to those issues that fall within the HEERA joint governance process. Should CFA decide to adopt a Furlough Program, then there may be other more specific issues that will require the input of the Academic Senates.

Q8. There has been some discussion regarding campus closures in December rather than two days per month. Is that the kind of option that could be negotiated on a campus-by-campus basis?
A8. The University is moving away from systemwide campus closures for all sorts of operational reasons, although some individual campuses may elect to follow this model.

Q9. Can every campus close for one more week in December to capture energy savings and furlough days?
A9. The advice that the CSU has received is that employees cannot take more than one  block of furlough days in any given 52-week period without opening up the CSU to  a liability for unemployment insurance. As the CSU is self-insured, this exposure  would  seriously negate the purpose of furloughs which is to reduce our compensation  expenses.

Q10. Does the CSU have an estimate for the amount of energy savings that could be generated by all campuses closing for one day? What are the seasonal variations (summer v. winter)?  Would a closure during the winter save more money than a closure during the summer?
A10. See #9 above.

Q11. Can furlough days be banked and the monthly paychecks be equalized?
A11. The CSU doesn’t want unemployment insurance liability (see #9 above). The one-year TA provides for the equalization of paychecks over 11 months.

Q12. Does the Chancellor’s Office intend to submit any tentative agreements to the Board of Trustees for ratification?
A12. No.

Q13. Please explain exactly how an employee’s paycheck would be affected by a furlough. If we agreed to a two-day per month furlough, would the gross pay be reduced, and as a result, all payroll-related deductions (federal income tax, state income tax) and employer expenses (FICA, Medicare, etc.) be reduced accordingly?
A13. Yes.

Q14. Will employees’ retirements be affected in any way by furloughs?
A14. No.

Q15. Will employees’ benefits be affected in any way by furloughs?
A15. No.

Q16. Will fee waiver benefits for employees or their dependents be affected in any way by furloughs?
A16. No.

Q17. Would furloughs have any impact on employees’ accruals of vacation and sick leave?
A17. No.

Q18. UC is proposing furloughs and/or pay reductions based on employee's income. Specifically, they are proposing lesser cuts for employees earning less than $46,000 per year. Is the CSU considering some sort of sliding scale?
A18. No.

Q19. The Chancellor’s Office has stated that one of its goals is to “share the pain” equally. However, is the CO going to take into consideration the fact that faculty and MPP not only earn more money than support staff, but, over the years, they have received higher pay raises as well?  Is it fair that furloughs and the pay cuts that go along with them not be adjusted to reflect this basic inequity?
A19. No, we are not considering a sliding scale.  The CSU did initially look at some tiered approach to furloughs but it soon became clear that (1) such a program would not generate the same level of reduced expenses as a system operating across all pay scales; (2) Deciding where to put the cut-off lines would be entirely arbitrary and inevitably result in some employees feeling that they had been unfairly treated; and (3) such a policy goes against the Chancellor’s statement that everyone shares the pain equally. While we understand the pressures that will be generated at the lower ends of the pay scales by the Furlough Program, we also have to be clear that absent a Furlough Program, there would be a significant number of employees within that group who would likely no longer have jobs within the CSU.

Q20a. If an agreement is reached on a furlough plan, how much notice will employees be given?
A20a. The Furlough Program will run retroactively from July 1st, but the first operational month will be August, 2009.

Q20b. What about the first two furlough days in July?
A20b.  In order to equalize pay throughout the year, the University will need to utilize the nominal two furlough days that would fall to be taken in July. For pay-roll “catch-up” purposes, it is anticipated that there will be one month in which four furlough days are assigned.

Q21. Is the CSU considering reducing the pay of any MPPs or executive employees who recently received pay increases?
A21. No.

Q22. How will the CSU ensure that employee workloads not be increased as a result of furloughs?
A22. The first point to make is that no employee is to perform any work during a furlough day. Exempt employees are converted to non-exempt employees for those weeks in which they observe a furlough day and must be paid for all work performed over 32 hours in that week.  Further, to deal with the concern raised by the CSUEU that exempt employees will be pressurized into taking on excessive or unreasonable workloads during non-furlough weeks, there will be a new complaint process that will allow employees to challenge any such assignments. The CSU also expects that workload issues will be examined as necessary by the systemwide Labor Management Committee that will also be formed pursuant to the Agreement. The CSU is committed to making this Program work and we recognize that this will involve not only the ongoing support of the CSUEU, but also our individual employees.

Q23. How can we ensure that cost savings generated by furloughs of CSUEU-represented employees are only used to mitigate layoffs for employees represented by CSUEU?
A23. Furloughs do not generate any “savings”; furloughs are just a means of reducing our compensation expenses. All it means is that we will be paying 9.2% less over 12 months for our expected labor costs

Q24. Will the salary savings from CSUEU units be embargoed or used to subsidize other bargaining units? How will this be tracked?  We do not want our furlough savings going to hire more MPP (or faculty?)!
A24. See #23. There are no savings.

Q25. Many CSU departments, such as student health centers, housing and parking, are self-supported. How will furloughs of these employees benefit the CSU?
A25. Consistent with the view that we should all share the pain equally, it was decided that the bright-line rule for furlough eligibility should be whether or not that individual is getting a CSU pay-check independent of where the funds may come from to support that position. This seemed the fairest way of dealing with the situation that we face and prevents the situation arising where two individuals are in the same classification, doing the same work, but one individual is being paid 9.2% less just because their salary is considered to be general fund rather than from another source.

Q26. Will the CSU support the creation of campus labor-management committees that can be tasked with discussing and making recommendations on cost-cutting measures?
A26. Yes.

Q27. Will the CSU support the creation of a systemwide LMC to monitor the situation statewide?
A27. Yes.

Q28. Could the CSU, CalPERS, or other agencies provide loans to employees?
A28. Without making any commitments, we would be willing to send a CSU representative  along with any CSUEU representatives to talk with CalPERS about any options that  might exist.

Q29. Can employees choose to go on an 11/12 program for one year instead of being furloughed?
A29. No.

Q30. Will employees who took voluntary reductions in the last six months have those reductions restored prior to a furlough program, so they do not take a double hit?
A30. Yes.

Q31. How will employees on paid leave be affected by furloughs (FML, parental leave, bereavement leave)?
A31. FML, NDI, and IDL would not be affected by the furlough. Contractual leaves like maternity, bereavement could not be used to cover one of the furlough days.

Q32. Will campuses cancel existing contracts for bargaining unit work to save money and avoid further displacement or layoffs (e.g., expensive IT contractor for Student Health Service at SFSU)?
A32. The CSU is in the process of identifying potential areas. Thus, everything is getting  looked at as part of the systemwide review that is taking place.

Q33. Will furloughs affect requests for IRP, in-class progression, and reclassification (those in progress now, and those to come)?
A33. There would be likely be reductions in the funds available for IRPs, but the programs are  still in place and available to the campuses to use.

Q34. Does the CSU plan to implement a hiring freeze while employees are being furloughed?
A34. We have already reduced all but critical purchases; placed a freeze on the salaries of the  most senior administrators; and implemented a freeze on all non-critical hires.

Q35. How will the CSU ensure that potential mass non-reappointment of temporary employees does not have a disproportionate impact on protected groups (particularly Unit 5)?
A35. We will follow the contract.

Q36. How will furloughs affect mandatory overtime and/or the distribution of overtime?
A36. If you are required to work overtime, and you work the overtime, you are going to get paid. But if campus resources have been reduced, there may well be reduced opportunities for overtime going forward.

Q37. How will CSU ensure that performance evaluations are not negatively affected by furloughs (Art. 24 language on layoffs protects employees from unrealistic expectations)?
A37. You are correct that Art. 24 protects employees from unrealistic expectations and the  contract will continue to provide that protection.

Q38. What about foundation employees? Will they be furloughed and the foundations closed when the campus closes? If not, why not?
A38. The Foundations are separate legal entities and not subject to the Furlough Program.

Q39. What about 10/12 employees who already have banked the time and salary for this year? Will furloughs take affect on their pay in their months off retroactively?
A39. No. If they have already banked and earned the time, then we are not going to take it away from them.

Q40. Will lump sum vacation payouts be affected by the furloughs?
A40. No.

Q41. How will new employees hired after a furlough plan is in place have their salary set? Will they be advised of a normal salary and then the actual furlough plan?
A41. Yes.

Q42. Has the CSU considered a complete hiring freeze?
A42. No. We have imposed a freeze on non-critical hires, but we recognize that some critical positions will still need to be filled during the Furlough Program.

Q43 Has the CSU considered a hardship program for employees under a furlough plan?
A43. No.

Q44. Will there be new policies for overtime?
A44. No.

Q45. How will the workload for exempt employees be managed in furlough and non-furlough weeks?
A45. The Tentative Agreement contains a detailed provision in Section 4 to deal with these  issues.

Q46. Will CSU executives have their housing allowance, cars and other perks reduced in addition to furloughs?
A46. No.

Q47. Will student assistants be affected? Will student assistant hours be frozen so that there is no increase in hours or number so they do CSUEU work?
A47. No, but student assistants are hired based on available funds, and there won’t be much in the way of extra funds.

Q48. Will there be a pro rata reduction in parking fees, since salaries are potentially being reduced?
A48. No.

Q49. How do we ensure that the overall quantity of work is reduced? With campus closures, there would be no work generated. Without campus closures, there is nothing to indicate that the overall amount of work will be reduced. If it is not reduced, an employee will either have to speed up their work or work for free.
A49. It is true that a furloughed employee will not be performing work during that day and there will be operational pressures created by the realities of any furlough program. Work will need to be prioritized and not all tasks may end up being performed as a consequence. Managers will have to come out with schedules that reflect the realities of furloughing and the reduced work schedules of employees.

Q50. What about an LMC to address workload issues to ensure that overload does not happen?
A50. The parties have agreed to create an LMC regarding workload issues.

Q51. What happens to per diem employees if the CSU does not close the campus on furlough days? (Some are working five days/40 hours per week.)
A51. The TA sets limits on per diem and intermittent employees.

Q52. It matters what happens to faculty, as they create work for our members.
A52. Whatever decision the faculty takes in regards to furloughs is independent of your union. But a reduction in students and faculty probably means a reduction in support positions as well.

Q53. Explain how exempt employees become non-exempt during a floating furlough program. What are the mechanics of that?
A53. We’re looking at fixed dates, for the month, quarter or term. People need to know, well in advance, which week(s) they will be non-exempt, since we will have to track hours.

Q54. What about funds from the CSU’s so-called cash cows (health centers, extended education, etc.)? Does it make sense to furlough employees in revenue-generating departments?
A54. If you’re a CSU employee, then you are part of the system and we believe that it is only fair that you take your share of the sacrifice (See #25).

Q55. If furloughs are not enough and layoffs are necessary, will negotiations be handled at the campus level?
A55. We will follow the contract.

Q56. Due to issues with the state budget, it is expected that more psychological/medical services will be needed for our students. How will this affect health centers and counseling services? Will such services be exempted from furloughs?
A56. Although Health center employees are not exempted from the Furlough Program, Student Health is a priority.  In these very difficult times the University will do its best to meet our student’s needs within the resources available. (See #54 and #25).

Q57. You said that, for the next budget year, the number of students will not be dictated by the legislature. Does this refer to FY 2009 or FY 2010?
A57. What we said was that the Joint Budget Committee had recommended that the CSU  appropriation for 2009/10 should not contain a specific number of students that the  CSU is expected to educate in return for that appropriation. This would mean that the  CSU would be free to reduce its student enrollments in line with the numbers currently  being planned for.

Q58. How can the SCO payroll system exempt university police and dispatchers?
A58. They could key in a classification code.

Q59. What about payroll advances (SAM 8595)?
A59. It’s in the SAM.