Section: News

As Kenyon cuts budget by $19.3 million, unions seek transparency and continued retirement contributions

As Kenyon cuts budget by $19.3 million, unions seek transparency and continued retirement contributions

As Kenyon prepares to reopen this August in the midst of the COVID-19 pandemic, the College is projecting a shortfall in its 2020-21 operating budget anywhere on the order of $19.3 million to over $50 million. To accommodate for this deficit, the College announced its plans to cut $4.9 million in contributions to retirement and retiree health plans for one year. Other cuts to the operational budget include $4.9 million from non-essential maintenance work, $1.5 million from hiring expenditure, $1 million from freezing any salary increases and $7 million from reserve funds and other operating expenses.  

“One thing I’d say about all these things is that they’re all fairly reversible,” President Sean Decatur said. 

In addition to these cuts, which will go into effect July 1, Decatur has said that he will be taking a 10-percent pay cut for the 2020-21 fiscal year. 

At a virtual staff meeting on May 14, the administration shared their initial plans for the 2020-21 budget with College employees. According to Decatur, Kenyon employees were also given a chance to provide feedback on these plans in various open forums in May. Decatur said that members of senior staff had also met with the Benefits Committee and Executive Faculty Committee to discuss the proposal and provide input.

Despite the College’s open forums, the decision to make these cuts led to some unrest among faculty and staff who felt they were not adequately consulted in this decision-making process. Employees expressed concern with how the College presented its plans at these meetings, which made them seem non-negotiable. 

Kenneth Smail Professor of Anthropology Ed Schortman, who has been involved in labor rights for nearly a decade, compared the College’s top-down approach in presenting these budget cuts to its attempts to outsource its maintenance department to Sodexo in 2012, although he indicated several important differences between the two scenarios. 

“The presentations are always, ‘This is what we’re going to do. Do you have questions?’” Schortman said. “You’re allowed to ask questions, you’re allowed to ask for clarification, you can ask why they did this. But there’s no sense that anything you say at this point will change what the decision is.” 

Many community members were also concerned that this decision directly went against the goals of the Middle Path Partnership (MPP), a coalition that was implemented in the 2012-13 academic year. The partnership was created in order to mitigate top-down decision making between the administration and the maintenance department as well as College employees’ three unions: United Electrical, Radio and Mechanical Workers of America (UE Local 712); International Association of Machinists (IAM Local 2794) and Security, Police and Fire Professionals of America (SPFPA). These three unions include maintenance staff, custodial staff and Campus Safety officers — only a fraction of all College employees. In this way, the majority of Kenyon employees are non-unionized, thus leaving them unable to effectively contest these cuts. 

Currently, IAM has accepted the College’s proposal, while negotiations with SPFPA and UE are still ongoing. Negotiations with UE in particular have been complicated by its contract, which stipulates that the College must contribute to employee retirement benefits. Because of this, UE Local 712 is the only union that can oppose these cuts, despite only representing 25 employees, However, Kenyon’s retirement plan, which is known as a 403(b), requires that all College employees be given the same benefits. In this way, whatever agreement UE makes with the College regarding retirement benefits will automatically apply to all Kenyon employees — unionized or not. 

At this point, UE is still in negotiations with the College, though they are hoping to finalize an agreement before the 2020-21 academic year. According to UE field organizer Hayden Schortman ’08, who is leading the negotiations alongside UE Local 712 President Bob Smith, UE has proposed two alternative plans to the College, both of which are still under review. 

Hayden was careful to note that UE recognizes that the College is in a difficult situation financially, and that some sacrifices are necessary. However, he made it clear that UE hopes to be compensated in the future for any losses they may take in the short-term.

“We still understand the College needs to make cuts. We’re not blind to what’s going on. We just want to make sure that cuts are made whole in the long run, because it’s the right thing for workers,” Hayden said. 

When asked about the College’s negotiations with the labor unions, President Decatur said he was optimistic about the various parties coming to an agreement in the near future, though he refrained from offering specifics. 

“We can’t say anything specific about the negotiations while they’re going on,” Decatur said, “beyond the fact that certainly the hope is that we treat all employees on campus equivalently.” 

In response to the proposed cuts to retirement benefits for employees, Stop the Cuts Coalition — a group of students working with faculty, staff and student organizations —  rallied the community together by launching their petition, “Kenyon College: Stop the Cuts to Your Workers’ Retirement Plans!” The creators of the petition are aiming to get 1,000 signatures and reached 909 at the time of publication.

Furthermore, members of Kenyon Young Democratic Socialists of America (KYDSA) involved in the petition have said that they hope UE will be able to use their petition, which has been circulating online for a number of days, as a bargaining chip during negotiations with the College. In a series of FAQs about the petition shared by KYDSA,  its creators questioned why cuts to retirement contributions were painted as the only alternative to layoffs, furloughs and wage cuts. 

The petition also questions the College’s decision not to tap into its “rainy day” fund to combat expenses from the pandemic. 

“We don’t wish to insinuate that the funding for matching retirement benefits must come from this fund, but rather that there has been a failure on the part of the College thus far to give adequate reasonings for why an institution with the ability to access such funds will not do so to protect its employees,” the petition states. 

However, Decatur explained that the College’s equivalent of such a fund will come from places such as the aforementioned $7-million cut in reserves from the 2020-21 operating budget. According to Vice President for Finances Todd Burson, there is a separate fund for emergency disaster situations, which he referred to as a “Quasi-Endowment Fund,” that accounts for $14 million of the College’s endowment. This fund is set aside by the Board of Trustees to be used exclusively during times of “extreme financial stress.”

“These [emergency disaster] funds can be used to pay expenses while the College figures out how it is going to respond to that particular challenge without making major structural changes while in the middle of an emergency,” Burson wrote in an email to the Collegian. “It is important to note that since this fund is an endowment fund, the income generated from this fund goes to support the College’s operating budget.”

Decatur also indicated that, because of uncertainty surrounding the College’s operating expenses for the 2020-21 academic year, the College could see shortfalls as high as $56 million. Therefore, the administration is refraining from using their emergency disaster fund for now in case shortfalls reach that amount. Decatur further emphasized that, in cutting retirement benefits, the administration is taking what they see as the most accessible option at this time.

“The last resort for us — a piece we’re trying to hold off on as long as possible — is laying people off. We prioritize the things that are sort of reversible. If we cap them now, we can give them back pretty easily,” Decatur said. “In trying to plan what the various tiers of emergency are, which funds we tap [into] are dependent on how bad the situation gets.” 

Ultimately, central to this conflict is a desire for mutual respect between the College’s employees and the administration, one which stems from a deep commitment to the Kenyon community. The Middle Path Partnership was created with this commitment in mind. 

“The Middle Path Partnership is about a collaborative effort between management and labor in order to define the goals and the practices of the maintenance department,” Professor Schortman said. “There are a couple of examples of this in the industry, but Kenyon’s the only college with a system like this.” 

As negotiations between UE and Kenyon continue, Hayden wanted to make it clear that employees chose Kenyon for a reason, whether out of practicality or the familial ties to the institution. To its employees, Kenyon is more than just a workplace: Smith’s family, for instance, has worked at Kenyon for three generations. 

“People do believe in what Kenyon stands for. It’s very important to them, what the institution represents. On the practical level, [it’s] because Kenyon’s wages are not the best, even in the area, [but] the benefits are,” Hayden said. “We have a lot of sympathy with the College. It’s multi-generational.” 

Although students and employees alike are sympathetic to the financial difficulties the College faces while navigating a pandemic, they continue to ask for a more transparent conversation. UE hopes to close out negotiations by the end of the fiscal year, which concludes on June 30; however, they are willing to continue conversations for as long as the administration may need to reach a decision. 

Should students be interested in signing the petition, they can do so here. 

 

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