Furloughs are one method to reduce labor costs

Question

Why isn’t the ten days of Leave Without Pay campus-wide? Only some departments are taking part. If the financial situation is so dire, everyone should be participating.

Response

UAF unit leaders were given some latitude to determine how best to manage this year’s significant budget reductions, while continuing to preserve those unit functions most necessary for fulfilling the unit’s mission.

Since most of the university’s costs are in labor (salaries and benefits), most units found it necessary to reduce labor costs in some way to balance their budgets. There are number of options for doing this, including laying people off; offering reduced contracts (e.g., reducing a 12-month position to a nine-month position, reducing a 40-hour per week position to a 30-hour per week position, etc.); reclassifying vacant positions to refill at a lower grade; imposing furlough days or leave without pay; instituting soft closure days where employees use existing leave if available; and leaving a position vacant temporarily or permanently.

The departments that instituted furloughs this year generally did so to delay more permanent labor reduction mechanisms such as the downward reclassification of positions, contract reductions or layoffs. There were, however, many units on campus that did reduce employee contracts, discontinue term positions and lay off employees.

The unresolved fiscal realities in the State of Alaska could mean that the university will have to impose deeper labor cost reduction strategies next year. However, university leadership is somewhat optimistic at this stage that the Legislature and governor will land on a more sustainable budget plan this year.

— Kari Burrell, executive officer and vice chancellor for administrative services