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Faculty Senior Associates Program

PROGRAM DESCRIPTION

Background

The Faculty Senior Associates Program enables an individual to leave the full-time faculty in advance of the normal retirement age. The Program is based on the termination of the tenure contract rather than on retirement itself; therefore, the Program is available only to full-time, tenured faculty members.


Eligibility

Full-time, tenured faculty members with at least ten years of service and who have attained age 62 are eligible to apply for participation in the Faculty Senior Associates Program. Participation is voluntary and must be approved by the Provost upon the recommendation of the dean of the individual’s school. A faculty member entering this Program is eligible for appointment as Emeritus upon the recommendation of the dean and approval by the Board of Trustees.


Request to Participate

The request to participate should be made at least six months in advance of the proposed date of entry into the Program. Entry begins July 1 or January 1. The dean of the faculty member’s school must forward the request for entry into the Program to the Deputy to the Provost for approval by the Provost.


Calculation of Initial Payment

The individual’s payment under the Faculty Senior Associates Program is dependent on several factors: final salary immediately before entering the Program, median salary of the relevant faculty cohort group, age, length of service, and Primary Social Security benefit when applicable.

In Arts, Sciences and Engineering, separate median salaries for each discipline (natural sciences, social sciences, humanities, and engineering sciences) are used.

In the School of Medicine and Dentistry, separate median salaries are used for: (1) clinical departments; (2) basic science departments; and (3) non-M.D. in clinical departments. The maximum salary value is $200,000 for use in calculating an individual’s payment and for determining the median salary of the cohort group.*

The derivation of the payment to be received under the Faculty Senior Associates Program may be summarized as:

Basic Value plus Service Bonus plus FSAP Bonus Points less Primary Social Security Benefit (for those at full retirement age and older) = FSAP Payment

The payment is calculated as follows:

  1. Basic Value - Expressed as a percent of the individual’s salary.
    1. Divide the individual’s salary by the median salary;
    2. Divide 100 by the quotient of (a)
    3. Subtract 80 from the quotient of (b).
  1. Service Bonus - Provides additional points for individuals with more than 20 years of service.

Subtract 20 from the number of years of faculty service and, if the difference is positive, divide by 2. (If the difference is negative, the service bonus is zero.)

  1. FSAP Bonus Points - Provides additional points for individuals based on age.
Age at Entering FSAP Total Bonus Points
62 12
63 9
64 6
65 5
66 4
67 3
68 2
69 1
  1. Payment %

Add 1, 2, 3 (above). The sum is the percentage used to determine the payment.

  1. Payment for First Year

Apply the Payment % to the individual’s salary.

Note: Payment for the first year cannot exceed 66.7% of the individual’s final salary immediately before entering the Program nor be less than 20% of the cohort median salary used in the calculation.

  1. Primary Social Security Benefit

For an individual at full retirement age (FRA) or older, subtract from the calculated payment the amount of the full Primary Social Security benefit, i.e., the amount the individual is entitled to receive at FRA whether or not the individual chooses to receive it.

FACULTY SENIOR ASSOCIATES PROGRAM
Data and Calculation Sheet
EXAMPLE ONLY
 
NAME:John Brown EMPLOYEE ID NO.:654321
ACADEMIC TITLE:Professor   
     
HOME ADDRESS: UNIVERSITY AFFILIATION:
Street44 Maple Street College/SchoolArts, Sci & Eng
City, State, ZipRochester, NY 14610; DepartmentOceanography
     
BIRTHDATE:11/26/1951 SERVICE DATE:7/1/1985
Age at Entrance62 Years of Service29
     
PROPOSED DATE OF ENTRANCE INTO PROGRAM:7/1/2014 
SALARY AT ENTRANCE INTO PROGRAM:INDIVIDUAL'S SALARY$110,000
   GROUP MEDIAN SALARY$130,000
 

1. BASIC VALUE:(a) Individual's Salary / Median Salary =0.85
 (b) 100 / Quotient of (a) =117.6
 (c) (b) minus 80 =37.6
     
2. SERVICE BONUS: (Years of Service - 20) / 2 =
(not valid if amount is less than zero)
 4.5
     
3. FACULTY SENIOR ASSOCIATES PROGRAM BONUS =
(See schedule on reverse side.)
 12.0
     
4. Basic Value + Service Bonus + FSAP Bonus = Payment %[54.1%]54.1
     
5. Payment % x Individual's Salary = Payment for First Year $59,510
   Payment for the first year cannot exceed 66.7% of the Individual's Salary immediately before entering Program nor be less than 20% of the Group Median Salary shown above. 
6. PRIMARY SOCIAL SECURITY BENEFIT =
   (for Full Retirement Age (FRA) of individual)
 
 
7. Payment for First Year - Primary Social Security Benefit =  
NET PAYMENT FOR FIRST YEAR  $59,510



Authorized by:  
 (Department Chair)(Date)
Authorized by:  
 (Dean)(Date)

Changes in Payment

Annual Payment

Beyond the initial year, the FSAP payment is adjusted each fiscal year (effective July 1 through June 30) by the increase, if any, in the median salary of continuing faculty in the rank of the participant’s school and discipline group if applicable. (The payment will not be reduced if the median salary is reduced.) The adjustment is made to the total payment, i.e., the payment prior to the reduction of the Social Security benefit, and any reduction for the Social Security benefit is made from the adjusted total payment. In June of each year, the dean of each school is asked to submit to the Deputy to the Provost the increase in median salaries for continuing faculty in her or his school for the following fiscal year. The adjustment in FSAP payments is made in the Deputy to the Provost’s office and submitted to the Human Resources Service Center.

Example:

 2011-12 2012-13 2013-14
Gross FSAP Payment$ 50,000$ 51,500$ 52,788
Primary Social Security Benefit028,00028,000
Annual FSAP Payment$ 50,000$ 23,500$ 24,788

Social Security Benefit Reduction

The FSAP payment is reduced at the full retirement age (FRA) by the amount of the full Primary Social Security benefit the participant is entitled to receive at FRA (whether or not the individual chooses to draw upon the benefit). Similarly, if an individual draws Social Security early (before FRA), it is not that amount but the amount of the full Primary Social Security benefit the participant would have been entitled to receive at FRA that is used in the calculation of the reduction. The FSAP payment is not adjusted for subsequent cost-of-living increases instituted by the Social Security Administration. The reduction begins the first day of the month following the month in which the individual reaches FRA. For example, if an individual were to reach FRA in February, her or his payment would be reduced by the amount of her or his Social Security benefit effective March 1.

A letter is sent from the Office of the Deputy to the Provost reminding the participant to send a copy of the notification obtained from the Social Security Administration that indicates the amount of the benefit the individual is entitled to receive at FRA. If a copy of the notification is not received by the 15th of the month in which the participant reaches FRA, the payment is reduced by the maximum Primary Social Security benefit an individual retiring at FRA could receive, as published by the Social Security Administration.

If the Primary Social Security benefit exceeds the FSAP payment an individual is receiving, the FSAP payment ceases. However, the calculation continues to be made each year to age 70. Should the amount of the payment reach the point of exceeding the Social Security benefit, the FSAP payment would be reinstated. One of the changes contained in the Social Security Amendments of 1983 was that the FRA would be gradually raised from age 65 beginning with persons born in 1938 to age 66 finally to age 67 (for those born in 1960 and after). The implementation schedule used by the Social Security Administration has been and continues to be used in the Faculty Senior Associates Program for making the Primary Social Security benefit reduction at FRA. The table below illustrates the implementation schedule.

Year of BirthFull Retirement Age (FRA)
Before 193865
193865 and 2 months
193965 and 4 months
194065 and 6 months
194165 and 8 months
194265 and 10 months
1943-5466
195566 and 2 months
195666 and 4 months
195766 and 6 months
195866 and 8 months
195966 and 10 months
1960 and After67

Payment Process and Taxability of Payment

FSAP payment checks are processed through the University payroll system and may be automatically deposited in the same manner as University payroll checks. Participants receiving an annual payment of $50,000 or less are paid semi-monthly, and those receiving an annual payment of greater than $50,000 are paid monthly.

FSAP payments are subject to federal and New York State withholding requirements. FICA tax is applicable due to the amendment in 1984 of the Social Security Act and is deducted from the payment. It is the University’s position that payments under the Faculty Senior Associates Program are not considered compensation for current services rendered and are not considered earnings that count against the “earnings test” for Social Security benefit purposes prior to full retirement age (FRA). The Social Security Administration’s practice has been consistent with the University’s position, but the University can make no guarantee that the Social Security Administration will continue this practice. The Senior Citizens’ Freedom to Work Act of 2000 eliminated the retirement earnings test for people who have attained FRA.

Part-Time Employment

Payments are not influenced by any outside earnings a participant might make after entering the Faculty Senior Associates Program. Payments are also not affected by part-time appointments offered by a school or department of the University provided that the participant’s total compensation from the University does not exceed 100% of the final full-time salary before entering the Program. That is, the combination of FSAP payment and part-time salary may not exceed the final full-time salary immediately before entering the Program. The FTE for part-time appointments should be less than 50% (based on final full-time salary).

Termination

Payments cease at the end of the month in which the participant reaches age 70. If a participant dies before the age of 70, the payments cease upon death.

Benefits

Benefits coverage for participants between the ages of 62 and 70 is the same as for active, full-time faculty members except for income maintenance programs such as long-term disability, sick pay benefits, and retirement contributions, which do not pertain. If an individual is enrolled in the health care plans, premiums can be deducted on a pre-tax basis. Participants also may elect a Flexible Spending Account (FSA) to pay for unreimbursed medical and dental expenses with pre-tax dollars.

Individuals in the Faculty Senior Associates Program are eligible for the same health care plans at the same premium rates as active, full-time faculty members. Upon attainment of eligibility for Medicare, the individual may elect to have Medicare either primary or secondary to the University of Rochester health care plans (i.e., the individual may elect to be treated as an active, full-time faculty member or as a University of Rochester “Medicare-eligible” retiree).

Questions about benefits coverage should be directed to the Human Resources Benefits Office. Benefits provided to participants are (like the benefits provided to all active faculty, staff, and retirees) subject to the right of the University to amend or terminate its benefits plan.

Changes to Program

It is the University’s policy not to discontinue offering the Program to new entrants or make substantial changes in the terms offered to new entrants without written notification to full-time faculty at least one year in advance of the effective date of the change. Any person already participating in the Program or who enrolls in it prior to the effective date of such a change would continue under the terms of the existing Program.

Questions

Questions about the Faculty Senior Associates Program should be directed to the dean’s office of the individual’s school or to the Office of the Deputy to the Provost.


*This limit will be reviewed periodically.

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Last modified: Monday, 04-Aug-2014 13:42:53 EDT