Thoughts On The ENP Discussion
OK, I didn’t stay at a Holiday Inn Express last night. However all parties flailing around about this topic are missing some salient points.
There is a market out there for teachers; each and every school district is more or less competitive than its rivals, near and far, on a variety of factors. Pay is a biggie, but as has been noted it’s not always the only factor at play. Distance to work; district reputation, cost of living in the area, working relationships in the school and district, benefits, etc all play a role in determining if a teacher will even seek employment in a district. If no one applies and you have openings, as an administrator, you have a problem. The task facing administrators is whether to be proactive or reactive about this set of circumstances. The current Board deserves credit for developing and approving the ENP concept.
Retention Tool
As a retention tool, the ENP freezes your current staff in place for a 1, 2, or 3 year period of their choosing; after that they are declaring an intent to retire; in essence they are giving you notice today. You now know when they are leaving and whether you have a likely replacement on staff. If not, you have some lead time to cultivate some prospects. My teacher friends tell me the normal requirement is to give notice by sometime in mid July if you don’t plan to return the next school year; with the earlier starting school year this only amounts to a 4 or 5 week window for recruitment and hiring. 4 weeks or 1 year; which would you prefer in the way of lead time?
Mandatory retirement ages no longer apply so employees can hang in there as long as they desire. A fictional employee, aged 52, with 30 years of service and a salary of $70,000 would receive $21,000 over a 3 year period for agreeing to retire in 3 years (there is some slight inaccuracy in my example because I’m not showing the value of the increase in both salary and ENP payment for years #2 and #3). At the end of the 3 years they will be giving up 100% of their salary, and will be reliant on their teacher pension and personal investments for income. I think teacher friends have said that Maryland’s teacher pension payout is about 40%, so that’s a big step-down (I apologize for the uncertainty regarding that percentage). Most early retirement plans provide a reduced benefit for those retiring early; that may also be a factor to consider. The retiree will not yet be able to draw on 401(k), 403(b), IRA or Social Security sources of income because they are too young. In addition, their premium for health care coverage will rise dramatically since it is subsidized at a much smaller rate. Might not want to put your notice in quite so fast after all, eh?
Since, according to the WCBOE website, brand, spanking new teachers come on board at just about $40,000, the district stands to save $23,000 per year in wages for this example ($70K – 7K ENP = 63K; 63K – 40K = 23K) . (As above there are some small inaccuracies from not getting actual year #2 and #3 figures). There are some likely auxiliary savings to boot. Our retiree-to-be probably has 1 or more dependents on the health benefits roster which represent both a premium expense and a potential liability for services. As a retiree, they will pay a larger share of the premium, which is a savings to the district. In addition, the new hire is likely to be single and with fewer healthcare issues to pay for in the next few years, which represent additional savings. With a smaller total payroll, Social Security and Unemployment taxes to the district are also reduced. So it was a good business decision.
Baby Boomers are an enormous cohort in any large organization (save Google, Microsoft and Daily Times perhaps), and they/we/me will all start heading for the exits at about the same time. Planning an orderly exodus makes a lot of sense. Don’t forget: a new Superintendent will be coming aboard soon and most of the experienced administrators are ‘Boomers. Will need some folks to stick around and mind the store.
So there are expenses associated with getting the ball rolling – the annual ENP amounts, but as each employee who has chosen the program leaves, savings begin to accrue.
Market Forces
That market forces actually operate is shown by teachers’ awareness that some surrounding districts were providing a greater subsidy for retiree healthcare benefit premium rates; the figure quoted seems to be 55% for Wicomico and 90% for Worcester.
With folks living longer in retirement, and healthcare costs on an upward trajectory like a missile launch, it’s no wonder that teachers took notice, and that some changed employers to better position themselves for the future. That premium savings represents a great deal of retirement income across many years of prospective retirement. Apparently, Worcester only required 5 years of service there in order to qualify for this higher subsidy; the remainder of the career would need to be in Worcester or another Maryland district.
In a sense, Worcester might be viewed as providing an inducement that would draw experienced teachers, who might help to improve its educational results. It would also keep its staff from roaming, and in a pre-mortgage meltdown economy, the rising value of the resort properties would pay the freight. That’s how a business would try to draw, say salesmen or engineers, from a rival.
With this perceived benefit, and an eager applicant flow of experienced candidates, Worcester could be more selective about whom it hired, thus meeting its goal of grabbing the best of the experienced candidates.
It’s uncertain what subsequently led Worcester to reduce its retiree healthcare subsidy to match Wicomico’s – but they felt they could or had to. There was no discussion as to whether Worcester would hold to the 90% subsidy for those already on board. Either way, the market was working.
And all parties would be wise to take note that each element of a contract can vary widely over a period of time. A younger workforce usually wants wages to rise more rapidly, while an older workforce gets more focused on retirement issues; as the composition of the work group changes, so will its shopping list and what it ultimately agrees to.
Teacher Work Schedules
I used to think teachers had it made in the shade, too. But if you talk to them, as I have, and examine the calendar, you could modify that view. The calendar is posted on the board website. Teachers started work August 20, 2007; school started August 27 and will end June 6, 2008. Nine months and 3 weeks by my calculation; leaves about 9 weeks of ‘time off’, still nothing to sneeze at. My kids were good kids, but they had their moments; not all kids are so tractable; think the teachers need some blocked R&R time.
I disagree with my colleague Cato in the example he cited of “a third grade teacher whose salary is listed as $80,179. Annualized, that salary is $107,000”. Actually, their salary is already annualized at $80,179; they are being paid x for y period. They are not being offered any work at that rate in the interim. It’s just not a useful number; they can’t spend it and we don’t pay it. We don’t have very sound information as to what bargain would be arrived at if the district wanted 12 months of work and the teacher wanted to work 12 months. Our society has numerous examples of folks who prefer a schedule other than a 50 workweek program, as well as lots of folks who accommodate themselves to it.
The school workday and workweek are basically carved in stone; no lunchtime errands, flextime or telecommuting. From just being around town on my travels, there are more cars in the parking lots after students leave than you might imagine. And my friends tell me that technology advances allow some after-hours tasks to be done from home via computer now.
Merit Pay; Seniority; Tenure; Productivity, Etc
These are sticky wickets individually, and as a group. Features like these are generally in place (or not) as a reaction to problems or inadequacies in the past – regardless of the specific workplace.
I’ve worked on installation, refinement and revision of merit review schemes for years; it always finishes as some variant of the camel-committee observation…and is generally getting a re-do in a year or two to rein in the managers who are abusing it or to fold in new, fashionable topics. Nothing suggests school folk would be better or worse.
Any employer that makes a wage structure adjustment is making a quasi-seniority pay decision. We’re all guilty. Besides – it’s a union contract; pretty much a one-way valve on that topic.
Tenure has its basis in protecting those who hold or share unpopular points of view. It’s a door that swings both ways. Given the composition of the Legislature in Annapolis, or Salisbury City Council, we should appreciate mechanisms that permit freer discussion than management might otherwise wish (e.g. Louweasel). When (say after a number of years of work, or achievement of certain benchmark accomplishments) it should be awarded is a fruitful topic, although like the benefits discussion above, market forces may come into play.
I like Six Sigma, and have been to management training about it a few years back. On first blush, I think it holds more promise on the administrative side of the equation than on the instructional side. The admin side probably has a lot of consistency in type and frequency of tasks; that can be low hanging fruit for process improvements. In a much larger sense, the entire No Child Left Behind concept matches up well with the thrust of Six Sigma. To identify problem areas; to formulate possible solutions; to try them out; to test for results. Report, modify, retry. Just like shampoo: Rinse, repeat.
Test results suggest that the ability to take standardized tests successfully continues to advance in our district and in much of the state. How closely test taking correlates to ‘actual education’ is certainly a topic that engenders lots of discussion!
Worth Noting: Info from WCBOE vs. City of Salisbury
It’s just been a couple of days since Cato broached the ENP topic. Clearly the newspaper’s request to the WCBOE for information came afterwards. Contrast that response time to the foot dragging and FOIA gauntlet Salisbury imposes on any topic or question the Mayor didn’t initiate or bless. Weather forecast: at WCBOE – more sunshine; at City of Salisbury – stormy, with occasional easels and frequent gavels.
Tenure at The Daily Times
The Daily Times must have a very aggressive ENP of its own since they are perennially splicing in new talent to replace their grizzled six and nine month veterans.
And the paper I bought today only had color on the external side of the comics – a shortcoming I’ve seen on another occasion recently. Usually stuff like the comics and other middle sections are run in mid-week, so there was plenty of time to find and rectify. New building, new press, new staffers – same old fish wrapper process and contents. Priceless!
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