Program Booklet for Eligible Faculty

Transcription

1 Program Booklet for Eligible Faculty NON-CLINICAL

2 Important Dates: Thursday, November 10, 2011 Last day to submit Application to Participate in the Phased Retirement Program Friday, February 10, 2012 Each participant s understanding with Deans must be finalized (Faculty who reach an understanding with the Dean will be given a Faculty Phased Retirement Agreement which must be signed by the faculty member within 45 days of receipt. Once signed, the applicant has seven days to submit written revocation of the agreement.) Sunday, July 1, 2012 First phased reductions and full retirements under the PRP begin Please visit for updates to important dates, answers to frequently asked questions and any updates to Program documents.

3 Table of Contents Overview...2 PRP At a Glance...3 Eligibility...4 Retirement Incentive Payment...5 Phase-Out Options Duration of Phase-Out Period... 6 Workload and Duties... 6 Satisfactory Performance and Applicable Policies...7 Compensation During Phase-Out Period...8 Resignation of Tenure Appointments...9 Benefits Overview...9 Benefits Chart...10 Participation Application Process...15 Negotiation Period...15 Faculty Phased Retirement Agreement...16 Denial of Participation...16 Other Important Information and Appeals Procedure Faculty PRP Checklist... Inside Back Cover Appendices Appendix A: Sample Faculty Phased Retirement Agreement...22 Appendix B: Sample Benefits Illustrations...35 Appendix C: Application Instructions...46 Appendix D: Sample Applications...47

4 2 Overview Since faculty are at the core of a university, faculty renewal is an on-going necessity for every university with attention devoted to hiring, faculty retention, and retirement. Howard University has a high proportion of its Tenured, Career Status, and Master Instructor faculty eligible to retire based on the University s retirement formula of age plus years of service equaling or exceeding 70. In light of this Howard University s Board of Trustees approved the offering of a voluntary, incentive Phased Retirement Program (PRP). Many faculty have expressed an interest in retiring, including participating in an incentive retirement program. The Faculty Senate recommended that a robust and fair incentive retirement program be offered this year; a presidentially appointed committee offered advice about how to structure a faculty incentive retirement program. A faculty survey of all retirement-eligible tenured faculty (with a response rate of 54 percent) revealed that many faculty felt they were in the final stages of their professorial careers, yet wanted to stay active with the University while progressively reducing their involvement over a period of time. For the University, the prospective retirement of significant numbers of senior faculty has to be handled as a carefully planned and orderly transition which inevitably must extend over a period of years (e.g., medical faculty may take two years to recruit, on-board and license). Recruiting and successfully integrating new faculty into Howard s community of scholars is a process that needs to be carefully planned and staggered over a period of years to avoid putting the continued smooth operation and accreditation of Howard programs at risk. Faculty want a planned and orderly transition in which their personal and professional plans are coordinated with the University s need to continue to successfully deliver programs in which these same faculty have, in many cases, invested much of their professional careers. Many faculty want to stay engaged with the University before fully retiring, while others wish to retire immediately. The faculty Phased Retirement Program (PRP) is designed to bring together these mutual needs and interests to create an orderly voluntary transition of retirement-eligible Tenured, Career Status and Master Instructor faculty. Faculty would fully retire or begin to reduce their proportion of full time service beginning July 1, 2012 on the basis of individual plans that provide for a phase-out period that could extend up to five years. The PRP offers incentives in recognition of long-standing service, while ensuring that the integrity of academic programs is protected. It is the University s intent to have all eligible faculty members who wish to participate accepted into the PRP. Since the integrity of the academic and clinical programs must be protected during this process, if mutually acceptable terms of departure of any specific faculty member cannot be negotiated to address the needs of the University, the faculty member may retire outside the PRP. Financial benefits of participation include a retirement incentive payment based on credited years of service. For every year of service, PRP participants will receive two weeks of salary, capped at an extra year s salary for PRP participants with 26 or more years of service. Faculty are paid for their work during the phase out period at a rate based on the faculty member s salary prior to entering the PRP pro-rata of the workload. During the phase-out period, PRP participants salaries will increase 3% per year, except in any year in which there is no pool for salary increases for those faculty outside the PRP. All participants, regardless of whether they are working full time, are provided health care and certain other benefits paid for by the University at the rate for full time current employees for the duration of their phase-out period. Lastly, PRP participants who are 62 or over, or as they become 62 may elect to collect retirement benefits under the Howard University Employees Retirement Plan/Defined Benefit Plan, concurrently with their salary for current work. By early Spring Semester 2012, departments will know the availability of faculty participating in the PRP, including those faculty who will fully retire as of June 30, 2012 and be able to plan their course offerings and develop hiring and faculty deployment plans accordingly.

5 PRP At a Glance The first retirements and reductions in workload under the PRP will be July 1, Fixed payment based on years of service at the rate of two weeks of pay for each year of service, up to a maximum of one year s pay. The duration, percentage of full time work and the nature of duties during each year of the phase-out period are negotiated between the faculty member and relevant Dean, working with the department chair. Interested faculty must submit an Application to Participate in the Phased Retirement Program by November 10, This initiates a period of negotiation with their Dean to determine the number of years, the proportion of full time work for each year and their requested duties during their phase-out period. The negotiation must be completed by February 10, It is only when the faculty member, Dean and Provost or Senior VP for Health Sciences, as appropriate, have each signed the written Faculty Phased Retirement Agreement (which is prepared following the negotiation process) that the faculty member is committed and becomes a participant in the PRP. Phase-out period of up to five years. The University will provide limited financial planning support for faculty as they evaluate the PRP in light of their personal circumstances. PRP participants can elect to collect pension payments under the Howard University Defined Benefit Plan concurrently with receiving their earned pay and their fixed payments once they reach age 62. Base pay for PRP participants will increase 3% per year for any year in which there is a general salary pool for faculty salary increases. Faculty in the PRP will not be subject to Faculty Performance Evaluation System (FPES) reviews, but must maintain satisfactory performance. After a faculty member has completed her/his phase out under this PRP, they are not disqualified from continuing to work for the University, though they may not be employed in administrative or tenure/tenure track positions. Written protocol guides the process. All decisions will be in writing to include written justification in the event of a denial of participation. An appeal process is provided. During the agreed phase-out period, health, dental and life insurance benefits will be paid by the University at the rate the University pays for active, full time employees. During the phase-out period, salary will be pro-rata of full time AY Institutional Based Salary (IBS) for the agreed percentage of a full-time academic workload for each year of the phase-out period, ranging from a maximum of 100% of a full-time workload to a minimum of 25% of a full time workload. Clinical faculty will receive a component of pay under the Faculty Practice Plan for clinical duties. 3

6 Eligibility A Howard University faculty member is eligible to apply to participate in the faculty Phased Retirement Program (PRP) if the faculty member meets all of the following: 1. Is a current faculty member of Howard University and not retired nor otherwise separated; 2. Was eligible to retire as of June 30, 2011, which under Howard University s criterion is that their age plus years of credited service is 70 or greater; 3. Had at least five years of credited service as of June 30, 2011; and 4. Had been granted tenure or is a member of the Board of Trustees-defined categories, Career Status or Master Instructor, as of June 30, Eligibility to apply does not make a faculty member a participant in the PRP. A faculty member must apply by completing an Application to Participate in the Phased Retirement Program by November 10, Following the completion of a negotiation process with his/her Dean by February 10, 2012, execution of a Faculty Phased Retirement Agreement, and approval by the Provost or Senior VP for Health Sciences, as appropriate, the eligible faculty member becomes a participant in the PRP. A sample of a Faculty Phased Retirement Agreement is contained in Appendix A to this booklet. A faculty member who retires or separates from the University prior to June 30, 2012 will not be eligible to participate in the PRP. Years of credited service for purposes of calculating the retirement incentive payment will be calculated as of June 30,

7 Retirement Incentive Payment Faculty participants in the PRP receive a Retirement Incentive Payment based on their length of credited service as determined for purposes of the Howard University Employees Retirement Plan. The Retirement Incentive Payment will be equal to two weeks of pay for each year of credited service, up to a maximum of one year s pay. Faculty members with 26 or more years of service will receive the maximum award of one year s pay. This Retirement Incentive Payment will be made whether the faculty member fully retires and terminates employment as of June 30, 2012, or, at the other end of the continuum, works full time for five years and fully retires as of June 30, Since faculty pay may vary year-to-year, the Retirement Incentive Payment for participation in the PRP will be calculated using the faculty member s highest actual W-2 earnings paid by the University during any of the following three 12-month periods: July 1, 2011 to June 30, 2012; July 1, 2010 to June 30, 2011; and July 1, 2009 to June 30, An estimate of the faculty member s earnings for the 12-month period from July 1, 2011 through June 30, 2012 will be used to calculate the amount of the Retirement Incentive Payment. However, if the actual earnings for this period are higher than the estimate and also higher than the earnings for any of the other two periods, then the Retirement Incentive Payment will be calculated based on the higher actual amount of earnings for this period. PRP participants fully retiring as of June 30, 2012 will be paid the full Retirement Incentive Payment within 60 days of June 30, For faculty members who will have a phase-out period, fifty percent (50%) of the Retirement Incentive Payment will be paid within 60 days of June 30, 2012, and the other 50% will be paid in equal annual installments after each academic year of the phase-out period, subject to the faculty member s satisfactory performance and compliance with his/her Faculty Phased Retirement Agreement. These payments will be made within 60 days of June 30 of the applicable year. 5

8 6 Duration of Phase-Out Period Faculty members may propose to stop working completely as of June 30, 2012, or to continue working for a number of years before finally terminating employment with the University. For those faculty members who continue to work past June 30, 2012, the period of time from July 1, 2012 through the termination of employment will be known as the Phase-Out Period. The Phase-Out Period may last one to five years. Thus, a PRP participant who wishes to have a Phase-Out Period can propose to retire on June 30, 2013, or on any subsequent June 30 through June 30, The actual number of years of the Phase-Out Period for each participant (if the participant wishes to have a Phase-Out Period) will be specified in the negotiated Faculty Phased Retirement Agreement signed by the faculty member and the University. A sample of this Agreement is contained in Appendix A. Workload and Duties Phase-Out Period Options Faculty members who will have a Phase-Out Period will propose the percent of a regular full-time workload that they will carry for each year of the Phase-Out Period ( Workload ). The Workload during the Phase-Out Period may be 100%, 75%, 50%, or 25% of full time, but the percentage of a full time workload must either stay the same or decrease year by year. The Workload for each year of the Phase-Out Period will be specified in the faculty member s Faculty Phased Retirement Agreement. Those faculty members who will have a Phase-Out Period will have the opportunity to request preferred duties to be performed during the Phase-Out Period within the agreed-upon Workload percentage. These duties, which may include instructional, research, advisory, and/ or other academic duties, as well as clinical duties for clinical faculty members ( Duties ), will be specified in the faculty member s Faculty Phased Retirement Agreement. The University will make a good faith effort to accommodate a participant s requested Duties, but the Duties listed in the Faculty Phased Retirement Agreement will be subject to change by the faculty member s Dean in consultation with the Department Chair (if applicable) based on the academic and clinical needs under the prevailing standards at the relevant time. Regardless of the Workload and the Duties to be performed, during the Phase-Out Period, participants will continue in the same rank and department (if applicable) and will continue to have the same college and school affiliation that they held prior to entering the Phase-Out period. PRP participants will not be permitted to accept other compensated employment within the University in any semester or teaching module falling within their Phase-Out Period and during which they are performing Duties. However, with the written approval of the faculty member s Dean and Department Chair (if applicable), the participant may perform additional work within the University (such as teaching or working on grants administered by the University) for

9 compensation so long as it is performed in a period of time during the Phase-Out Period in which the participant is not required to perform any Duties (e.g., during a semester or module in which no Duties are required to be performed). Other employment outside the University is permitted, consistent with the Faculty Handbook and other University policies, provided it does not present any conflict of interest or otherwise interfere with the participant s University position. After entering into his/her Faculty Phased Retirement Agreement, a faculty member may make one (1) request during the Phase-Out Period to modify the date that employment will terminate, the Workload, and/or the requested Duties. This option is more fully explained in the Faculty Phased Retirement Agreement, a sample of which is included in Appendix A. Satisfactory Performance and Applicable Policies PRP participants will agree to continue to loyally and faithfully perform their Duties during the Phase-Out Period, and to maintain relevant professional license credentials, certifications, and competence. Participants will be required to complete an annual report for their Dean of their Duties and other activities and accomplishments. The Dean will examine this report, a report from the Chair of the Department (for those faculty working within a department structure), and other evidence that is relevant to determine whether there are any deficiencies in performance. A Dean s finding of deficiency will be communicated to the participant, and then must be addressed and remedied by the participant as soon as possible. A finding of serious deficiency which is not promptly remedied may result in the application of sanctions. Any finding of serious deficiency or application of sanctions will be subject to the review of the Program Administrator consistent with the appeal procedures of the PRP, as set forth in the Other Important Information and Appeals Procedure section of this PRP Booklet. The rules and policies of the University that apply generally to employees, as well as those that apply generally to the faculty regardless of status (including the Faculty Handbook) as such policies exist and may be amended from time to time, will continue to apply to the participant s employment during the Phase-Out Period, except as inconsistent with the participant s Faculty Phased Retirement Agreement or this PRP Booklet. These policies include, but are not limited to, the University s policy relating to academic freedom, and the University s policies concerning intellectual property such as inventions, copyrights, patents, and technology transfers ( IP Policies ). It is understood that the participant s Faculty Phased Retirement Agreement does not affect the respective rights and obligations of the parties under the University s IP policies except for the release of any existing legal claims contained in the Agreement. Notwithstanding the foregoing, participants will not be eligible to invoke the grievance procedures set forth in Section 2.8 of the Faculty Handbook, entitled Grievance Rights, Privileges, and Resolution of Disputes Governing Academic Freedom and Conduct of the Faculty. Dispute resolution relating to the PRP will be as provided in the Other Important Information and Appeals Procedure section of this PRP Booklet. 7

10 Compensation During Phase-Out Period PRP participants will receive a salary during the Phase-Out Period (if they have a Phase- Out Period) that will be based on their regular full-time basis annual salary as of June 30, 2012 ( Salary ). (For academic administrators (e.g., Chairs and Deans) who will relinquish their administrative assignments during the Phase-Out Period and continue in faculty positions, the Salary used to set pay during the Phase-Out Period will include the component for the administrative assignment.) For any academic year of the Phase-Out Period that a participant works at 100% of the regular full-time faculty workload, he or she will receive 100% of the Salary, less applicable withholdings and deductions. For any academic year of the Phase-Out Period that a participant works at less than 100% of the regular full-time faculty workload, he or she will receive a proportional percentage of the Salary for that year, less applicable withholdings and deductions. To the extent that a faculty member moves from working a 12-month work schedule prior to the Phase-Out Period to working a 9-month work schedule during the Phase-Out Period, the Salary will be adjusted accordingly. The Salary will increase by three percent (3%) each year of the Phase-Out Period (beginning at the start of the first year), subject to the participant s satisfactory performance and compliance with the participant s Faculty Phased Retirement Agreement, except that the Salary will not increase in any year in which there is no general pool for increasing salaries for faculty members who are not participating in the PRP. During the Phase-Out Period, PRP participants will not participate in the Faculty Performance Evaluation System ( FPES ) process or be subject to FPES reviews. 8

11 Resignation of Tenure Appointment As a result of signing the Faculty Phased Retirement Agreement and becoming a participant in the PRP, a faculty member s tenured, Career Status, or Master Instructor faculty status (as applicable) at the University will permanently end on June 30, 2012, and the faculty member will irrevocably waive, resign, and relinquish all tenure or Career Status or Master Instructor appointment rights (as applicable) as of that date. Faculty members who have a Phase-Out Period will continue in the same rank and will continue to have the same department (if applicable) and college or school affiliation that they held prior to entering the Phase-Out Period. Faculty members will be contract employees during the Phase-Out Period whose employment is subject to the terms of the Faculty Phased Retirement Agreement and the PRP. A sample of the Faculty Phased Retirement Agreement is contained in Appendix A. Faculty members who relinquish tenure and enter the Phased Retirement Program will remain eligible, while serving full-time during a 1 to 5 year phase-out period, to serve on department and school/college Appointment, Promotion and Tenure Committees with the full rights and responsibilities held prior to entering the PRP. In addition, regardless of the percentage of full-time workload, faculty in a phase-out period will remain eligible to participate as voting members on other department, school/college and university committees for which tenure is not required. Benefits Overview PRP participants will receive ongoing benefits during a PRP phase-out period which are summarized in the following Benefits Chart. The chart includes columns that summarize the benefits that are being provided currently to faculty, the benefits that will be provided to PRP participants during a phase-out period and the benefits that are provided to retirees for which PRP participants will be eligible at the end of the phase-out period. There is also a sample Retirement and PRP Benefits Statement in Appendix B illustrating the statement which eligible faculty will receive from the Office of Human Resources. In addition, the University will offer financial planning assistance for PRP-eligible faculty members which assistance will include one-on-one meetings with a financial planning professional of their choice. Further information on financial planning will be provided in separate materials. The benefits that are summarized below are provided pursuant to University benefit plans. The University reserves the right to change its employee benefit plans and offerings for all employees, retirees and beneficiaries. Benefits are subject to actual plan terms in effect at a given time. In the event of a conflict between the plan terms and the summary chart below, the terms of the benefit plan will control. 9

12 Benefits Chart Faculty Phased Retirement Program (PRP) Benefits Chart Benefit Programs Retirement Incentive Payment Healthcare Program CIGNA Medical* CIGNA Dental *Pharmacy and Vision Benefits are Included Prior to Participation in the Phase Out Retirement Program (PRP) Benefits During Phase Out Retirement Program N/A Retirement Incentive Payment of up to one year s pay based on years of service at the rate of two weeks of pay for each year of service accrued as of July 1, 2012 (maximum of 52 weeks). This will include a 50% upfront payment with the balance spread over the phase-out period. For those fully retiring as of June 30, 2012, the up-front payment is the full Retirement Incentive Payment amount. The remainder of the Retirement Incentive Payment is paid in installments following the end of the academic year based on satisfactory completion of the year s work. A PRP participant who drops out of the program forfeits any undispersed Retirement Incentive Payments Healthcare Program for full-time employees. Retiree Healthcare Program Class II. Premium contribution; the same as full-time faculty members. Even if age 65 or more, throughout the PRP program the University plan is primary and Medicare is secondary. You do Benefits at the Completion of Phase Out Retirement Program N/A Retiree Healthcare Program. Premium contribution the same as retirees in applicable category below: - Hired prior to July 1, 1993 or those - Hired/Rehired rehired after June 30, 1993 Those age 65 and over must obtain Medicare Part 10 Page 1 of 5

13 Benefits Chart Faculty Phased Retirement Program (PRP) Benefits Chart Benefit Programs Prior to Participation in the Phase Out Retirement Program (PRP) Benefits During Phase Out Retirement Program not need to obtain Medicare Part B at this time. Benefits at the Completion of Phase Out Retirement Program B in addition to Medicare Part A. University healthcare program will be secondary with Medicare primary. Howard University Employees Retirement Plan (Defined Benefit) HUERP pension available, if age plus service equals seventy (70): Upon retirement. In-service, April 1 st of calendar year following age 70 ½ HUERP pension available, if age plus service equals seventy (70): In service distribution election beginning at age 62 In-service, distribution continues for those already receiving pension based on April 1 st of calendar year following age 70 1/2 HUERP pension continues if elected prior to or during PRP Must commence immediately if Normal Retirement Date has been reached, i.e., June 30 th on or after 65 th birthday. Howard University Savings Plan Contributions (403(b), Roth and 457(b)) Employee Employer Howard University Savings Plan 403(b) Disbursements Life Insurance Based on FTE Salary - Employee may contribute up to regulatory limits Employer contributes 6% and matches up to 2% of Employee contribution, not to exceed regulatory limits Loans Hardships (Employee Contributions Only) Age 59 ½ Withdrawals Age 70 ½ Minimum Distributions Based on PRP Salary**- Employee may contribute up to regulatory limits Employer contributes 6% and matches up to 2% of Employee contribution, not to exceed regulatory limits Loans Hardships (Employee Contributions Only) Age 59 ½ Withdrawals Age 70 ½ Minimum Distributions No further contributions by Employee or Employer. Loans Hardships (Employee Contributions Only) Distributions Based on Termination of Employment Age 70 ½ Minimum Distributions 1) Basic 2) Supplemental 3) Spouse 4) Dependent ($10,000) Based on FTE Salary Based on FTE Salary Based on FTE Salary Dependent ($10,000) Based on FTE Salary Based on PRP Salary** Based on PRP Salary** Dependent ($10,000) Based on last FTE Salary Based on last PRP Salary** Based on last PRP Salary** Dependent ($10,000) Page 2 of 5 11

14 Benefits Chart Faculty Phased Retirement Program (PRP) Benefits Chart Benefit Programs Remission of Tuition Short-Term Disability Prior to Participation in the Phase Out Retirement Program (PRP) Full-time (and 50%) faculty eligible. Dependents of full-time employees eligible. Policy provisions in force for credit hour limits and eligible academic programs. Based on FTE salary, 50% of weekly base pay up to $1,000 per week up to six (6) months. Benefits During Phase Out Retirement Program Benefits continue as if fulltime faculty member for self and eligible dependents. Based on PRP** salary, 50% of weekly base pay up to $1,000 per week up to six (6) months. Benefits at the Completion of Phase Out Retirement Program Retirees are eligible only if receiving HUERP pension for up to 21 credit hours per semester. Eligible dependents receive same benefits as dependents of active full-time employees. N/A Long-Term Disability Based on FTE Salary, 60% of monthly base pay up to a maximum of $10,000 per month until the earlier of Social Security Normal Retirement Age, or until disability ends. Based on PRP** salary, 60% of monthly base pay up to a maximum of $10,000 per month until the earlier of Social Security Normal Retirement Age, or until disability ends. N/A Permanent Disability or Death (Retirement Incentive Payments) N/A Remaining Retirement Incentive Payments will be paid out as a lump sum to the estate of the PRP participant. N/A Flexible Spending Account (Based on Pre- Tax Dollars) Healthcare ($3,000, will be reduced to $2,500 beginning January 1, 2013) Dependent Care ($5,000) Employee contributions may continue, up to regulatory limits. N/A Employee Assistance Program Available to all full-time employees and their dependents. Continues. N/A Federal and State Income Tax Taxes applied to all income. PRP earnings are subject to Federal and State taxes. HUERP: Subject to both Federal and State (mandatory withholding) income tax. Retirement Incentive Payments earnings are subject to Federal and State taxes. HUERP: Subject to both Federal and State (mandatory withholding) income tax 12 Page 3 of 5

15 Benefits Chart Faculty Phased Retirement Program (PRP) Benefits Chart Benefit Programs Social Security and Medicare Tax Prior to Participation in the Phase Out Retirement Program (PRP) Payroll taxes are withheld from salary for Social Security and Medicare. Benefits During Phase Out Retirement Program PRP earnings are subject to Social Security and Medicare taxes. Retirement Incentive Payments are earnings and subject to Social Security and Medicare taxes. HUERP: Not subject to Social Security and Medicare taxes. Benefits at the Completion of Phase Out Retirement Program HUERP: Not subject to Social Security and Medicare taxes. Social Security Benefits You may start receiving benefits as early as age 62. For those born in 1947 (turning 65 in 2012), normal retirement age for Social Security is 66 years. If under SS normal retirement age when you begin Social Security benefits, $1 in benefits will be deducted for each $2 earned above the annual limit. For 2011, the limit is $14,160. In the year you reach full retirement age, $1 in benefits will be deducted for each $3 you earn above a different limit but only for the months before the month you reach the full retirement age. For 2011, the annual limit is $37,680. Starting with the month you reach normal retirement age, you can receive your full Social Security benefits with no limit on your earnings. Other Benefits Offered paid by the Employee: AFLAC Home and Auto Insurance ARAG Pre-Paid Legal Long Term Care CIGNA AD&D Available to employees who work full-time and have these payments payroll deducted. Same Note that the Retirement Incentive Payment earnings during the phase out retirement period are also considered earnings for purposes of the Social Security offset. May continue benefits by payroll deductions. Same May continue Long Term Care only. Page 4 of 5 13

16 Benefits Chart Faculty Phased Retirement Program (PRP) Benefits Chart Benefit Programs Financial Planning Prior to Participation in the Phase Out Retirement Program (PRP) All Employees eligible to participate in the PRP (not just those who indicate their preference to participate in the PRP program) will be given the option of receiving independent Financial/Retirement Planning. Employees who choose to go to their own advisor will be reimbursed up to $400 in the aggregate. The Financial planning must be completed by Friday, November 18, Benefits During Phase Out Retirement Program All Employees eligible to participate in the PRP will be given the option of receiving independent Financial/Retirement Planning from a firm to be Determined. Employees who choose to go to their own advisor will be reimbursed for up to $400 in the aggregate. The Financial planning must be completed by Friday, November 18, Benefits at the Completion of Phase Out Retirement Program N/A Workers Compensation All University employees are covered. Coverage continues at the PRP earnings rate (excludes the Retirement Incentive Payments). N/A Note: Howard reserves the right to make changes to its benefits program for all employees, retirees and beneficiaries. Any such benefit changes will also apply to the PRP participants and beneficiaries. Benefits are subject to the actual plan terms in effect at a given time. In the event of a conflict between the terms of any benefit plan and this summary, the terms of the benefit plan will control. ** PRP Salary is based on the percent workload specified in the Faculty Phased Retirement Agreement. Footnotes: 1. PRP participants will not be eligible for sabbatical or any type of paid leave that is provided pursuant to University policies. 2. If you are certified for Long Term Disability (LTD) benefits after the PRP Agreement is signed, but prior to 7/1/2012, your employment will end as of the date of LTD certification and you will receive 50% of the Retirement Incentive Payment up front with the balance spread over the phase out period designated in your PRP Agreement. If you are on approved Short Term Disability (STD) benefits either at the time or after the PRP Agreement is signed, but prior to 7/1/2012, you will receive 50% of the Retirement Incentive Payment up front and the balance spread over the phase out period designated in your PRP Agreement. You will not be entitled to any additional HU income sources until you return to duty, provided that your return is before the expiration of the STD period, i.e., six months. If you do not return to duty prior to the expiration of the STD period, you will not be entitled to any further HU income under the PRP, but may apply for LTD benefits or continue/commence/defer HUERP benefit payments. 14 Page 5 of 5

17 Participation Application Process Faculty members who are interested in participating in the PRP must submit an Application to Participate in the Phased Retirement Program to the office of their Dean by Thursday, November 10, Submitting an application is not a commitment to retire and does not change a faculty member s status in any way. Details about the application and instructions on completing it are included in Appendix C. Negotiation Period Timely submission of an application initiates a three-month period during which the faculty member works with his/her Dean, assisted by the Department Chair (if applicable) to negotiate a mutually acceptable plan specifying the details of the applicant s participation in the PRP. The faculty member and the Dean (and Chair, if applicable) will discuss whether the faculty member will have a Phase-Out Period, and if so, the number of years of further work in the Phase-Out Period (from one to five). The parties will also discuss the proportion of a full time workload for each year of this period (100, 75, 50, or 25 percent). The application solicits each faculty member s requested duties for each year of the Phase-Out Period. These duties will be discussed in the negotiation period, but the faculty member s ultimate responsibilities during the Phase-Out Period (if an agreement is reached, as discussed below) will be based on departmental needs in that future period, though within the agreed workload. Further information concerning workload and duties is described in the section above concerning Phase-Out Period Options. Phased Retirement Agreement In order for a faculty member to participate in the PRP, he or she must reach a mutual understanding with the University relating to his or her termination date, duration of any Phase- Out Period and workload by February 10, If such an understanding is reached, it will be documented in a Faculty Phased Retirement Agreement that will be signed by both the faculty member and the University. The Faculty Phased Retirement Agreement will set forth the faculty member s Retirement Incentive Payment, duration of Phase-Out period, Workload, requested Duties, compensation during the Phase-Out Period, and various other terms. It will also include a release of any claims the faculty member might have against the University. A sample Faculty Phased Retirement Agreement is included in the Appendix. After receiving the completed Faculty Phased Retirement Agreement, the faculty member will be given 45 days to consider and sign it. After signing the agreement, the faculty member 15

18 will also have 7 days to revoke it if desired. In the case of revocation, the agreement will be null and void; the faculty member will not be required to retire or relinquish any rights, will not receive any of the payments and benefits under the PRP, and the relationship between the faculty member and the University will return to the status quo. If the 7-day period expires without revocation, the agreement will become effective. It is only when the faculty member and the University have signed the Agreement and it has become effective that the faculty member has resigned his or her tenure or Career Status or Master Instructor status as of June 30, Denial of Participation Although the University s goal is to allow participation in the PRP for all faculty members who wish to retire under its terms, participation is neither automatic nor guaranteed. In order to maintain the integrity of the University s academic and clinical programs, the University reserves the right to deny participation if it is determined that a faculty member s participation would impair the continued effective or efficient operation of a University academic or clinical program. All participation determinations will be made on a non-discriminatory basis, without regard of a faculty member s race, color, national origin, sex, age, religion, disability, or any other characteristic prohibited by applicable law. Denial of participation may be appealed. In making the determination of whether to accept an eligible faculty member s request, the Dean will consider the instructional, student support, research, service, leadership and administrative needs of the department or other relevant unit including its degree programs, service and elective course offerings and other academic requirements. The Dean, in consultation with the department chair (if applicable) will take into account available staffing considering the number, skill set, specializations, credentials, teaching history and research experience of faculty available for meeting each academic need. This will be done in awareness of planned retirements, separations and loss of availability including through the PRP, current and projected hiring plans, student enrollments, and projected curricular changes. Department level faculty availability planning must look at faculty availability year by year. The faculty member s capabilities and potential roles will be considered in relation to the needs identified. Any offer of participation in the PRP made by the University must not adversely affect the ability of the department to offer, or contribute to the ability of other departments to offer, published degree programs with the level of quality and educational opportunities currently available. 16

19 Other Important Information and Appeals Procedure Plan Name and Type The formal name of the Phased Retirement Program is the Howard University Phased Retirement Program. The Phased Retirement Program is considered an employee benefits plan under the Employee Retirement Income Security Act of 1974 (ERISA), as amended. Name and Address of Employer The Phased Retirement Program is sponsored by: Howard University Department of Benefits and Pension Administration th Street, NW Suite 422 Washington, DC Employer Identification Number The Internal Revenue Service has assigned Howard University the following employer identification number: Phased Retirement Program Administration The Phased Retirement Program is administered by a committee (the Program Administrator or Administrator ) consisting of the Provost, the Senior Vice President of Health Sciences, and the Chief Human Resources Officer. The Administrator is responsible for maintaining records, approving participants, determining Phased Retirement Program benefits, and resolving disputes with respect to participation, benefits amounts and the terms or operation of the Phased Retirement Program and the Faculty Phased Retirement Agreement ( Agreement ) entered into by a participant in the Program, including, but not limited to disputes arising as a result of employment during any phase-out period under the Agreement. The Administrator shall have the full and complete discretion to (a) adopt such rules for the administration of the Phased Retirement Program as it considers desirable, (b) construe the terms of the Phased Retirement Program, (c) correct defects (including requiring repayment of improperly paid amounts), (d) supply omissions, (e) reconcile inconsistencies to the extent necessary to effectuate the Phased Retirement Program, (f) seek advice of counsel, and (e) take other actions needed in carrying out the functions of the Program Administrator. Any actions taken pursuant to this paragraph are discretionary actions of the Administrator, and shall be conclusive and binding on all parties. The Program Administrator s address is: Jimmy Jones Chief Human Resources Officer Howard University th Street, NW Suite 422 Washington, DC Fiscal Year of the Program The fiscal year of the Phased Retirement Program shall be from July 1 to June 30. The Phased Retirement Program is a window phased retirement plan of limited duration, in which all Participants must begin their phase-out period (if any) as of July 1, All employment during phase-out periods shall be completed in accordance with the terms of the individual Participant s Faculty Phased Retirement Agreement. Under the terms of such agreements, all Participants must permanently give up tenure, or, if applicable, their Career Status or Master Instructor appointments, as of June 30, 2012, and their employment must terminate no later than June 30, Agent for Service of Legal Process The General Counsel, Howard University, has been designated as the agent for the service of legal process. Claims and Appeals Procedure A claim for Phased Retirement Program benefits, i.e., participation, must be in writing and delivered to the office of the Dean of 17

20 18 the faculty member s school or college. The procedure and time limits for submitting your claim for benefits is contained in other sections of this Booklet including those titled Eligibility and Participation. Your Application for consideration shall be considered a claim for Phased Retirement Program benefits. Following the Dean s receipt of your claim and the completion of the process for negotiation of terms relating to termination date, workload and requested duties during any phase-out period with your Dean, you will receive a written notice from the Dean if your proposed terms for participation in the Phased Retirement Program have not been accepted by February 10, If special circumstances require an extension of time beyond February 10, 2012, written notice will be given to you prior to February 10, 2012 and will explain the reasons for the extension. If you are not furnished notice regarding your claim within these time periods, your claim will be considered denied. Any disputes that arise concerning the benefits of, or the terms or operation of, the Phased Retirement Program or the Faculty Phased Retirement Agreement entered into to participate in the Program, including disputes arising from employment during any phase-out period under the Agreement, will also be considered a claim. Any such dispute should be raised initially with your Dean for decision. If you are not furnished a written notice from the Dean regarding your claim that arises during the administration of the Phased Retirement Program within thirty (30) days after you have presented the dispute to the Dean, or if you have been given written notice that there are special circumstances requiring an extension of time beyond the thirty (30) day period which explains the reasons for the extension, at the end of such extension period, then your claim will be considered denied and you have 60 days to request a review by the Program Administrator. If the Dean denies your claim, i.e., participation in the Phased Retirement Program, or your claim relating to benefits of, or the terms or operation of, the Phased Retirement Program or the Faculty Phased Retirement Agreement, in whole or in part, he or she will notify you in writing, specify the reasons for the denial, refer you to the applicable provisions of the Phased Retirement Program or Phased Retirement Agreement document or other relevant records or papers, and identify any additional material that might be necessary to perfect your claim and why it is necessary. You will also be told how you can appeal to the Program Administrator for reconsideration of the decision and of your right to bring a civil action following an adverse decision on appeal. Should you disagree with a Dean s determination, you have 60 days to appeal. If you seek reconsideration and review of denial of a claim, the Program Administrator will reconsider your claim and its resulting decision will be issued to you in writing within 30 days after your request. If more time is needed because of unusual circumstances, you will be notified. The Program Administrator or its delegate has the exclusive discretionary authority to construe and to interpret the Phased Retirement Program, to decide all questions of eligibility and participation for benefits, and to determine the amount of such benefits, and questions relating to the terms and operation of the Phased Retirement Program or the Faculty Phased Retirement Agreement entered into to participate in the Program, and its decisions on such matters are final and conclusive. Any interpretation or determination made pursuant to such discretionary authority shall be upheld on judicial review, unless it is shown that the interpretation or determination was an abuse of discretion (i.e., arbitrary and capricious). Assignment of Benefits Benefits under the Phased Retirement Program may not be assigned, transferred or pledged to a third party, for example, as security for a loan or other debt. Phased Retirement Program Amendment and Termination The University reserves the rights to amend or terminate the Phased Retirement Program at any time for any reason. Termination or amendment of the Phased Retirement Program shall not affect the rights of any employee who has been approved by the Program Administrator to participate in the Phased Retirement Program, has entered into and not revoked a Faculty Phased Retirement Agreement, and has begun reduced effort during the phase-out period under the Phased Retirement Program.

21 Statement of ERISA Rights As a participant in the Phased Retirement Program you are entitled to certain rights and protections under the Employee Retirement Income Security Act of 1974 (ERISA). ERISA provides that all plan participants shall be entitled to: Examine, without charge, at the Program Administrator s office and at other specified locations, such as worksites, all documents governing the Phased Retirement Program and a copy of the latest annual report (Form 5500 Series) filed by the Phased Retirement Program with the U.S. Department of Labor and available at the Public Disclosure Room of the Employee Benefits Security Administration. Obtain, upon written request to the Program Administrator, copies of documents governing the operation of the Phased Retirement Program and copies of the latest annual report (Form 5500 Series) and updated summary plan description. The Administrator may make a reasonable charge for the copies. Receive a summary of the Phased Retirement Program s annual financial report. The plan Administrator is required by law to furnish each participant with a copy of this summary annual report. Obtain a statement telling them whether they have a right to receive a benefit and if so, what their benefits would be. This statement must be requested in writing and is not required to be given more than once every twelve (12) months. The Phased Retirement Program must provide the statement free of charge. In addition to creating rights for plan participants, ERISA imposes duties upon the people who are responsible for the operation of the employee benefit plan. The people who operate the Phased Retirement Program, called fiduciaries, have a duty to do so prudently and in the interest of you and other plan participants and beneficiaries. No one, including their employer or any other person, may fire them or otherwise discriminate against them in any way to prevent them from obtaining a benefit or exercising their rights under ERISA. If your claim for a benefit is denied or ignored, in whole or in part, you have a right to know why this was done, to obtain copies of documents relating to the decision without charge, and to appeal any denial, all within certain time schedules. Under ERISA, there are steps you can take to enforce the above rights. For instance, if you request a copy of plan documents or the latest annual report from the Phased Retirement Program and do not receive them within 30 days, you may file suit in a Federal court. In such a case, the court may require the Program Administrator to provide the materials and pay you up to $110 a day until you receive the materials, unless the materials were not sent because of reasons beyond the control of the Administrator. If you have a claim for benefits which is denied or ignored, in whole or in part, you may file suit in a state or Federal court. In addition, if you disagree with the Phased Retirement Program s decision or lack thereof concerning the qualified status of a domestic relations order or a medical child support order, you may file suit in Federal court. If it should happen that plan fiduciaries misuse the Phased Retirement Program s money, or if you are discriminated against for asserting your rights, you may seek assistance from the U.S. Department of Labor, or you may file suit in a Federal court. The court will decide who should pay court costs and legal fees. If you are successful the court may order the person you have sued to pay these costs and fees. If you lose, the court may order you to pay these costs and fees, for example, if it finds your claim is frivolous. If you have any questions about your plan, you should contact the Program Administrator. If you have any questions about this statement or about your rights under ERISA, or if you need assistance in obtaining documents from the Program Administrator, you should contact the nearest office of the Employee Benefits Security Administration, U.S. Department of Labor, listed in your telephone directory or the Division of Technical Assistance and Inquiries, Employee Benefits Security Administration, U.S. Department of Labor, 200 Constitution Avenue N.W., Washington, D.C You may also obtain certain publications about your rights and responsibilities under ERISA by calling the publications hotline of the Employee Benefits Security Administration. 19