Present and Future Goals: 

The overall goal of the R&B committee is to continually push the University administration to improve the package of benefits made available to the faculty and/or retirees, their spouses and their families, and to be an important, powerful resource for the correction of problems that individuals might experience while attempting to gain or exercise the benefits to which they are entitled. If any member of the University faculty has (1) a problem obtaining the fruits of their benefits or (2) an idea to improve the quality of the benefit package, the R&B committee encourages faculty to correspond with any member of the committee or with the GFC at large. This subcommittee of the GFC, perhaps more than any other, is capable of favorably impacting on the quality of life of faculty and their families. It has done so in the past and with your support will continue to do so. It is for this reason that the members of this committee remain highly dedicated to the committee and its work, some having served continuously for many years to see it through to a completion.

Proposal on Eligibility for Retiree Insurance:

The GFC recommends that the University Administration proceed with their proposal to reduce the age for eligibility for retiree insurance from 60 to 55 (under certain conditions) using the following text which is to appear in the Faculty Handbook and with the change of the words "faculty member" to "employee"-in other documents. This change is to be effective 1/1/01: Provided that they do not take other employment where they would be eligible for such coverage, faculty members with at least ten years of continuous full time service who participate in a University health or dental plan as of the date of retirement are eligible to continue such coverage through Northwestern retiree health and/or dental insurance programs -including family coverage- beginning at age 55. Faculty members with fewer than ten years of full-time service may qualify according to a schedule available on the Benefits Division website. Participants in retiree health and/or dental plans must pay the full premium for Northwestern coverage, without any University contribution. Should a retired faculty member's Northwestern retiree health or dental insurance coverage be discontinued for any reason as permitted by the Plan, such coverage may not be reinstated. Persons may not be added to the retiree's coverage following enrollment in the retiree health or dental insurance plan. Should a faculty member die while actively employed by the University, his or her surviving spouse may continue health and/or dental coverage under the retiree plan even if the individual did not qualify for retiree coverage at the time of death (in terms of age or service).

Proposal on Vanguard Group of Mutual Funds Background

At the suggestion of Gene Sunshine, Vice President for Finance, the Retirement and Benefits Subcommittee began an initiative to determine if the retirement plan should be broadened to allow for more opportunity for investment beyond that offered by TIAA/CREF and the Fidelity family of mutual funds. Proposal
The GFC recommends that the University administration expand the 403b retirement program to include the Vanguard family of annuity funds because the introduction of The Vanguard Group of mutual funds into Northwestern University's retirement plan will increase the range of investment choices and styles available to faculty and staff

Report on the activities of the Retirement and Benefits Subcommittee of the General Faculty Committee for the period autumn 1998-spring 2000:

The Retirement & Benefits Subcommittee (R&B) of the GFC is currently composed of 3 members of the GFC parent committee (Burt Weisbrod, Bob Decker, and Bob Ten Eick [chairman]) and a number of others selected from the faculties of the various schools of the University by the R&B chairman so as to have a reasonably wide cross-section of the University represented (Tom Geraghty, Rae Moses, Marcus Alexis, Lawrence Lichty, Ed Rossow and Al Telser). Most committee members serve (and have served) for 2 or more years in order to maintain a modicum of continuity in the process of pursuing the committee's and University's ideas and initiatives. The work of the committee is to review, monitor and upgrade the quality and/or quantity of the benefits provided by the University to the faculty including those related to health and dental care plans, tuition reduction plans, retirement plans, the wide range of services provided to the University faculty community by the Human Resources Department, faculty-related parking issues, benefits and issues concerning emeriti faculty and retirees and the like to mention a few.

In the Fall of 1997, the faculty's satisfaction with services in the purview of the Human Resources Department (HR) was less than desirable. To counter this sentiment, the R&B Com, then under the leadership of Prof. Ed Rossow, began a dialogue with the VP for HR, Guy Miller and his senior staff. The committee met with Mr. Miller at regular intervals throughout the school year. During the past 2 years under the leadership of Prof. Bob Ten Eick the dialogue has been continued and expanded from 4 to 6 (or more as needed) meetings per year. These regular meetings between the committee and Mr. Miller and his staff have fostered a spirit of cooperation in our joint attempts to solve many of the University's HR-related problems and has allowed us to evolve from being a group whose main focus was to forward faculty complaints to one of being a partner with the administration in the development of new initiatives in upgrading the quality and quantity of the benefits provide to faculty and staff by the University. As a result of this partnership the GFC and the University administration can point with some small amount of pride to the following list of accomplishments of the past year and a half.

1. HR now consults with the R&B Com of GFC in the early Fall of each year to solicit our advice with regard to the changes or additions and deletions from the health, drug and dental care plans offered to faculty and staff that are proposed by the University (with 3/4s of the premium costs covered by the University.) There is never much leeway for additional coverages owing to the expensive nature of the current plans, but at least the HR administration receives the benefit from our judgements concerning what we think is or is not important to the greatest number of faculty.

2. About a year ago the University agreed to permit surviving spouses and the immediate family of faculty who die prior to retirement to continue their health and dental benefits under the University plan at their own expense (i.e., with no University contribution) for as long as they wish. Prior to this change, they were eligible only for coverage through the COBRA option and eligibility expired after 3 years. This provides for a significant increase in family security for faculty and their families.

3. Faculty who choose to retire as early as age 60 (and soon, at age 55) also can continue to have their health and dental care be covered by the University's plans at their own expense for as long as they maintain continuous coverage and do not leave the plan for any reason.

4. After many years of discussion, the University has begun to phase in paying retirement contributions to faculty on salary earned during the summer/research quarter from sources such as grants and contracts. The phase-in is now in the second of a 4 year plan to reach the full contribution level. President Bienen deserves the credit for this significant benefit because he listened to and accepted the arguments made by GFC and the faculty-at-large in support of this change.

5. Perhaps the most significant of the recent changes in the benefits package for faculty and staff is the new tuition reduction plan for spouses and dependent children. Again, President Bienen deserves most of the credit for the initiative. As result, the University's tuition contribution to the dependent children of faculty and staff who attend institutions other than NU is now much more generous than before. This was accomplished by reducing the tuition contribution made to dependents attending NU and making the contribution the same for all rather than unfairly favoring the children of faculty who attended NU.

6. Most recently, as result of a suggestion by VP for Finance Gene Sunshine, the R&B Com began an initiative to determine if the retirement plan should be broadened to allow for more opportunity for investment beyond that offered by TIAA/CREF and the Fidelity family of mutual funds. As result of our research on the matter, we are recommending to the University Administration that the Vanguard Group of Mutual Funds be added to the retirement plan. This group of funds will fill a gap in the range of investment opportunities that was previously unavailable to us, namely a wide range of index funds.

7. At the present moment, we are exploring the idea that faculty and staff could and would make good use of an investment advisory service to maximize the performance of their retirement monies and reduce their investment risk. We are assessing on-line internet based financial advisory services such as mPower and Financial Engines. Such financial advisory services, if brought in, would be strictly on a fee-for-service basis, paid for by the individual subscribers and at no cost to the University other than collecting a payroll deduction to pay for the individual's internet access to the service. If we conclude that this might be a good thing for faculty, we would ask the University to invite the selected service to test the market at NU and make a proposal for a fee schedule, etc.

8. Another new, on-going initiative of the R&B is to explore mechanisms to improve the benefits provided by the University to emeriti and other retirees. We would like to improve the lot of the retired person who chooses to remain a part of the University family and perhaps even desires to continue to serve in some mutually agreeable capacity. The Provost has also begun to address this situation by creating a blue ribbon committee of emeriti elders to study the area and we will begin to collaborate with that group to develop a plan that will make the prospect of retirement more attractive to the person who really wants to remain connected to the University in significant ways.

9. Finally, it has occurred to the GFC that the level of life insurance coverage provided by the University's group plan to the younger faculty (who are at or near the average starting assistant professor salary level) will not provide significant security to a surviving spouse and young family in the event of the death of the faculty person. To rectify this, we are exploring ideas and mechanisms to increase the level of coverage for the younger faculty and yet not increase the total cost of the group coverage to the University. This may involve a slight reduction in the level of coverage provided for the older (>58 y.o.a.) faculty for whom the cost to University for coverage is higher than it is for younger persons. Alternatively, the present tapering in the level of coverage could begin at a slightly earlier age than at present or it could become steeper. The underlying rationale being that by the time a person is nearing 60 y.o.a., the value of the death benefit in the retirement plan is quite substantial.

This report is submitted to the University Senate, May 18th, 2000 by the R&B Committee of the GFC. Robert Ten Eick, chairman.