|
Restart of Employee Contributions to Retirement Program to be Rescheduled
UC Office of the President| May 21, 2007
Good retirement benefits are an essential part of employees’ total compensation and an important recruitment and retention tool for UC. Unlike at many other institutions, UC employees have not had to contribute toward the cost of their pension benefits for over 15 years, due to UCRP being fully funded since the early 1990s. However, since UCRP is expected to become underfunded in the next several years, contributions – from both UC and employees -- will again be needed to help keep UCRP strong. The Regents are committed to maintaining a healthy pension plan in order to ensure UC’s ability to pay retirement benefits, and to also avoid the funding problems that many other pension plans are having.
As previously announced, contributions from both
UC and employees were scheduled to start July 1, 2007,
subject to several factors including State funding.
Because UC will not receive State support for this
purpose in its 2007-08 budget, the restart of UCRP
contributions will need to be rescheduled.
University leaders will continue to discuss this issue with State officials over the coming months, and employees can expect more information about this soon.
In recognition of the State’s interest and
role in helping maintain a healthy UCRP, and restarting
contributions, Governor Schwarzenegger’s revised
budget for 2007-08 proposes that the State fully fund
its share of the cost for UC’s employer contributions
to UCRP in future years, consistent with funding for
the State’s employer contributions to CalPERS:
www.universityofcalifornia.edu/news/2007/may14.html
While the new date for restarting contributions is
unknown at present, the Regents’ long-term approach
to how UC and employees will share the cost of UCRP
benefits will be consistent with the State’s
approach to contributions to CalPERS. Based
on a current projected total ongoing cost for UCRP
of 16% of payroll, this would mean UC and its employees
pay approximately 11% and 5% respectively toward the
cost of maintaining UCRP benefits. For represented
employees, the restart of contributions will be subject
to the collective bargaining process. |
