Cost Savings… by VinnyMyler


									Cost Savings Update
Heather Pope

Cost Savings Mechanisms
• Furlough Update • Separation Programs and Metrics
– Voluntary Separation Programs (VSP’s) – Retirement Incentive Programs (RIP’s)

• Reductions in Force and Metrics • Additional Considerations • Agency RIF Lessons Learned (Kandy Peacock)

Mandatory Furlough Changes
• Now available to an agency whose other funds are projected or will be less than in the prior fiscal year. • Additional flexibility to designate furlough by pay band (classified employees) or pay rate (unclassified employees.)

• Flexibilities added allowing agencies to exempt: – Law Enforcement employees and Correctional employees if the agency will incur overtime – Direct patient, client care, and front-line employees who deliver direct customer services

Mandatory Furlough Changes
• Voluntary Furlough days count toward furlough days required by a mandatory furlough. • Agency heads must be included in any mandatory furlough. • Currently, these changes do not apply to employees of institutions of higher education and technical colleges.

Mandatory Furlough Metrics
• Approximately 42 state agencies reported mandatory furloughs since 11/01/08. • Agencies averaged 6 mandatory furlough days.

• $30,251,116 in cost savings from the mandatory furloughs as reported by agencies.

Voluntary Separation Programs
• • • • • • • ETV DNR PRT DHEC SLED DPS Commerce • Spartanburg Tech • Attorney General’s Office • State Auditor’s Office • Greenville Tech • Archives

Retirement Incentive Programs
• • • • • • • DNR DHEC Consumer Affairs SLED DPS Commerce Budget and Control Board • • • • • • Clemson Forestry CHE Trident Tech State Auditor’s Office Archives

VSP Examples
• Eligibility
– – – – All employees in FTE positions Employees currently eligible to retire Employees with 28 Years of Service TERI participants prior to June 6, 2005

• Incentives
– 1 week’s salary for every year of service not to exceed 50% of employee’s salary – $5000 payment – $750 for every year of state service, payment not to exceed 28 years – Lump sum payment up to 25% of employee’s salary

RIP Examples
• Eligibility
– Employees currently eligible to retire or will be eligible as of 6/30/09

• Incentives
– 2 years qualified service, 1 year nonqualified, not to exceed $35,000 or annual salary, whichever is less – 3 years qualified service, 1.5 years nonqualified, not to exceed 50% of annual salary

Separation Program Metrics
• 136 employees separated through a VSP. • 101 employees separated through a RIP.

• The cost savings from these separation programs is anticipated to be $11,488,549 over 2 years.

RIF Plans Approved FY 2008-2009
• 22 Agencies submitted Reduction-in-Force (RIF) plans • 139 RIF plans approved • 318 positions projected to be eliminated

Reduction-in-Force Metrics
• 22 agencies implemented a RIF since 7/1/08. • 215 employees statewide were separated by a RIF. • The cost savings was approximately $8,385,646.

Other Separations Metrics
• Employees without grievance rights separated from state employment since 11/01/08
– 107 Probationary Employees – 148 TERI Employees or Rehired Retirees – 11 Time-Limited Employees – 16 Temporary Grant Employees – 5,480 Temporary Employees

Additional Considerations
• Mandatory Furlough
– Minimum of 7 days notice to employees – Employees on H1B Visas cannot be included

• Reporting Information to OHR
– Use specific HRIS codes to record VSP, RIP, and RIF actions – RIF Notification Date

Additional Considerations
• Reduction in Force
• Organizational Charts:
• Make sure the chart is up to date • Competitive Area in plan must match the competitive area listed on the org chart. • Include all positions with State Classification Titles • Clearly mark the employees without grievance rights

• Effective Date
• When implementing multiple RIF Plans, consider using the same effective date to minimize impact on employees.

• Importance of Proper Classification • Retention of Necessary Qualifications (RNQ)
• Focus on the requirements for the position

RIF Lessons Learned

Kandy Peacock, Chief Human Resource Administrator SC Technical College System

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