University won’t implement temporary pay cut plan this year

Aerial view of campus

Despite significant budget challenges created by the COVID-19 pandemic, the University of Oregon will not be temporarily reducing salaries of faculty members and officers of administration under the progressive pay reduction plan this winter.

The university established the contingency cost-saving plan for a 12-month pay reduction as a way to address potential budget losses to the university’s education and general fund.

Jamie Moffitt, the UO’s chief financial officer, said the COVID-19 pandemic has caused significant reductions to the university budget. Units such as housing, dining and the Student Recreation Center, also known as auxiliaries and which operate with self-generating budgets, experienced large reductions. The university’s total student enrollment also dropped by 3.6 percent, with first-year undergraduate revenue down significantly from prior projections.

“While this is cause for concern, the situation this year is not as dire as was feared last spring,” Moffitt said. “Fortunately, FY2021 state operating funding for the institution has remained intact. Additionally, the cost-saving measures that campus implemented over the last eight months have helped mitigate these losses for this year.”

Those measures include, among other things, a hiring and pay freeze, voluntary leadership salary reductions, the Work Share Program and a ban on all nonessential travel.

“Although these cost-saving initiatives are one-time measures that cannot fully blunt the impact of ongoing enrollment losses, they have helped improve our current financial situation,” Moffitt added.

However, she stressed that the institution still faces considerable financial risks in the future, including significant cuts to state funding next year as well as the potential for continued enrollment challenges. She said the university will continue to monitor enrollment and appropriations going forward and will reevaluate the need for the pay reduction plan in summer 2021.

The pay reduction plan applies to faculty members and officers of administration. Compensation for other employment groups is provided for under applicable collective bargaining agreements. Additional information about the plan is available on the Office of Human Resources website.   

Moffitt and Mark Schmelz, chief human resources officer, said they are grateful for the efforts across campus to address the financial and operational challenges of the pandemic.

“Thank you for all you do for our students and each other,” Schmelz said. “The work that our faculty and staff has done to prepare and respond to the challenges of the pandemic has been outstanding, and it is this resiliency that will help us through these unprecedented times.”