OFFICE OF THE PRESIDENT HUMAN RESOURCES POLICY MANUAL SECTION 11 JULY 28, 2006 REDUCTION IN FORCE GUIDELINES

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1 Purpse A reductin in frce is an actin t reduce the number f emplyees in a wrk unit r university-wide. A reductin in frce may becme necessary due t reduced funding, rerganizatin, change in wrklad, r ablishment f a psitin. It is the plicy f the UNC Office f the President and General Administratin that emplyees are t be reduced in frce nly after examining available alternatives, including separatin f temprary emplyees, delay in filling vacant psitins, psitin redesign and wrk unit rerganizatin, and jb sharing. If feasible, cnsideratin may be given t reducing psitins frm full-time permanent t part-time permanent status and retaining incumbent emplyees n a part-time basis with a crrespnding reductin in pay and benefits, thus aviding separating emplyees and ablishing entire psitins. Eligible Emplyees Ineligible Emplyees These guidelines apply t permanent SPA emplyees (full time and part time scheduled t wrk 20 r mre hurs per week) wh have cmpleted their prbatinary perid and t trainee emplyees wh have cmpleted at least six mnths f their trainee prgressin. Temprary emplyees, prbatinary emplyees, emplyees with timelimited appintments, permanent emplyees scheduled t wrk less than 20 hurs per week, and trainee appintments wh have cmpleted less than six mnths f their trainee prgressin are nt subject t these guidelines; therefre, they are nt eligible fr reemplyment pririty r severance pay. Guidelines The fllwing guidelines are develped t assure emplyees that ptential reductins in frce shall be cnsidered n a fair and systematic basis. These guidelines are available n the Human Resurces Divisin s website r a printed cpy may be btained frm Human Resurces. These guidelines are als n file as a public recrd with the Office f State Persnnel. Authrity t Make Reductin in Frce Determinatins The President (r designee) in cnsultatin with the Executive Officers shall identify the units where psitins must be reduced r eliminated and the number f psitins r prgrams which must be reduced r eliminated t meet the reductin requirements within the UNC Office f the President and General Administratin. A representative frm the Finance Divisin, the Reductin in Frce Guidelines

2 Authrity t Make Reductin in Frce Determinatins (cntinued) Legal Divisin, and the Human Resurces Divisin must be included amng the fficials invlved in the reductin in frce review prcess. The President and Executive Officers, with input frm ther vice presidents, divisin directrs and department managers in affected units, as apprpriate, will determine whether t eliminate entire prgrams, parts f prgrams r selected psitins. Identifying Emplyees t be Reduced in Frce Factrs t be Cnsidered Reductin in frce decisins require a thrugh evaluatin f the accmplishments f specific prgrams, the need fr specific psitins, and the relative qualificatins f emplyees t determine hw t prvide the best services pssible with a reduced wrk frce. When identifying emplyees t be reduced in frce, management must systematically cnsider the fllwing factrs: Appintment type f each emplyee Relative efficiency and prductivity f the emplyee(s) Overall perfrmance evaluatin rating f affected emplyee(s) Relative skills and knwledge f incumbent emplyee(s) Value f the psitin(s) and emplyee(s) t the rganizatin Impact upn the missin f the rganizatin Length f ttal state service f incumbent emplyee(s) Actual r ptential impact n the diversity f the wrk frce Dcumentatin Requirements Separatin List All steps taken in the reductin in frce prcess must be dcumented by the fficials invlved in the reductin in frce review prcess. The dcumentatin must be submitted t Human Resurces alng with a list f emplyees t be separated. The list f emplyees t be separated shuld cntain the fllwing infrmatin: Reasn(s) fr the reductin in frce Brief explanatin f the effrts made t avid reductin in frce and why ther alternatives were nt pssible Name(s) f emplyee(s) t be separated and justificatin fr the decisin (including an explanatin f hw the factrs listed abve were cnsidered) Anticipated date f separatin Reductin in Frce Guidelines

3 Reductin in Frce Ntificatin Requirements Written Ntificatin Requirements If a reductin in frce is necessary within the UNC Office f the President and General Administratin, the affected emplyee(s) must be given a minimum f thirty (30) calendar days fficial written ntificatin prir t separatin. The written ntificatin must include: Reasn(s) fr the reductin in frce (e.g., reduced funding, rerganizatin, change in wrklad, ablishment f a psitin, etc.) Effective date f the reductin in frce Instructins fr the emplyee(s) t cntact the Human Resurces Divisin t btain infrmatin abut: eligibility fr pririty reemplyment cnsideratin, the availability f assistance in seeking ther emplyment with the University r state gvernment, pssible eligibility fr severance pay r discntinued service retirement, ptins regarding retirement system membership and cntinuatin f benefits available t emplyees reduced in frce, including cntinuatin f health insurance, infrmatin abut unemplyment insurance eligibility, and applicable appeal rights Pririty Reemplyment Cnsideratin Pririty reemplyment cnsideratin begins upn ntificatin t an emplyee f his/her impending reductin in frce. The emplyee receives pririty cnsideratin fr 12 mnths frm the date f receipt f written ntificatin f the reductin in frce. Emplyees wh retire (r apply fr retirement) after receiving fficial written ntificatin f impending reductin in frce, but befre separatin frm reductin in frce, will waive the right fr pririty reemplyment cnsideratin. Emplyees wh chse t apply fr retirement after separatin frm reductin in frce may retain pririty reemplyment cnsideratin rights fr the 12-mnth perid. When the department knws f the need fr a reductin in frce well in advance f the anticipated effective date, it is recmmended that the department ntify the emplyee infrmally and give the emplyee an pprtunity t prpse when the fficial written ntificatin f reductin in Reductin in Frce Guidelines

4 Pririty Reemplyment Cnsideratin (cntinued) frce will be given. This gives the emplyee sme cntrl ver when pririty reemplyment rights begin and end and may help facilitate jb placement effrts. The Human Resurces Divisin must btain and submit an applicatin (Frm PD-107) t the Office f State Persnnel t request pririty reemplyment cnsideratin fr each emplyee wh requests such cnsideratin. If an emplyee des nt want assistance in finding anther State jb, the emplyee must prvide Human Resurces with a written statement t that effect. A cpy f that statement will be frwarded t the Office f State Persnnel. Other Benefits Severance Pay Discntinued Service Retirement In additin t pririty reemplyment cnsideratin, emplyees reduced in frce may be eligible fr the fllwing benefits: Severance pay may be paid t permanent full-time r part-time emplyees (regularly scheduled t wrk 20 hurs r mre each wrk week) wh are separated by reductin in frce and wh d nt btain ther permanent State emplyment by the effective date f the separatin. Severance pay is subject t apprval by the Office f State Persnnel and the Office f State Budget. In rder fr severance pay t be apprved, ecnmies in the State budget must result frm the reductin in frce. If apprved, severance payments are paid bi-weekly and are based n the emplyee s ttal state service supplemented by an age adjustment factr. Severance pay des nt apply t emplyees wh are defined as ineligible (see Ineligible Emplyees sectin abve) r emplyees wh are separated n early, service, r disability retirement. When a reductin in frce accmplishes ecnmies in the State budget and if funds are available, emplyees may be eligible fr discntinued service retirement if recmmended by the State Persnnel Directr and apprved by the President and the State Budget Directr. Ecnmies in the State budget is defined as ecnmies resulting frm the eliminatin f a jb and its respnsibilities r frm a lack f funds t supprt the jb. An emplyee wh chses discntinued service retirement shall nt be paid severance pay. In rder t be eligible fr discntinued service retirement an emplyee must have: 20 r mre years f creditable service and be age 55 r lder t receive an unreduced benefit, r Reductin in Frce Guidelines

5 20 r mre years f creditable service and be age 50 r lder t receive a reduced benefit (reduced by ¼ f ne percent fr each mnth under age 55). Cntinued Health Insurance Vacatin Leave Sick Leave Lngevity Emplyees with at least ne year f state service wh are participating in the State f NC Health Plan at the time f separatin due t reductin in frce will cntinue t receive the University s cntributin fr their individual health insurance cverage fr ne year frm the date f terminatin r until reemplyed in anther permanent State psitin, whichever is sner. If the separated emplyee is nt reemplyed in a permanent State psitin after ne year, he r she may cntinue cverage n a fully cntributry basis. Cvered dependents f emplyees may als be cntinued n a fully cntributry basis. Emplyees separated due t reductin in frce are paid a lump sum payment fr accumulated vacatin leave nt t exceed 240 hurs and a lump sum payment fr vacatin bnus leave (if applicable) nt t exceed 200 hurs. Emplyees separated due t reductin in frce shall be infrmed that accumulated sick leave shall be reinstated if reemplyed in a leave earning psitin with the State within five years. If eligible fr lngevity at the time f separatin, a prrated lngevity payment is paid t the emplyee. Right t Appeal A career state emplyee, as defined by statute, wh is separated due t reductin in frce shall have the right t appeal t the State Persnnel Cmmissin fr a review t assure that systematic prcedures were applied in making the reductin in frce separatin decisin. The appeal must be filed initially thrugh the internal Emplyee Mediatin and Grievance Prcess f the UNC Office f the President and General Administratin. The Final Agency Decisin resulting frm the internal appeal prcess may be appealed t the State Persnnel Cmmissin. Related plicies including Pririty Reemplyment Cnsideratin fr Reductin in Frce Emplyees, Prmtinal Pririty, and Pririty Referral System can be fund n the Human Resurces website under Recruitment and Selectin plicies. Plicies related t Severance Salary Cntinuatin, Discntinued Service Retirement, and Ablishment f Reductin in Frce Guidelines

6 Right t Appeal (cntinued) Psitins can be fund n the Human Resurces website under Separatin plicies. A Reductin in Frce Transitin Guide is als available n the Office f State Persnnel website at This guideline has been reviewed and apprved by: Original Signed by Mlly Crbett Brad August 17, 2004 Date _ Reductin in Frce Guidelines