For the moment, Harvard will not be pursuing layoffs or furloughs of its employees. But it is offering them the option of early retirement packages.
Workers at the nation’s best-endowed university can elect to retire earlier than they had planned, with the added benefit of an year’s extra pay. They can also volunteer to draw down accrued vacation time, and employees can reduce their work hours by 10% to 50% for a minimum of two months, according to an update this week from the school.
“We hope that everyone will contribute to Harvard’s financial sustainability and eventual financial recovery, either through participation in one of these voluntary programs, or backing up and covering for coworkers who may elect them,” Katie Lapp, executive vice president at Harvard, said in the letter. “We all have a role to play.”
The workforce programs come after Harvard projected a $750 million revenue shortfall for next year. And while the school is also planning to continue supporting directly employed staff and contract workers with pay and benefits beyond June, layoffs may be on the table in the future.
“We will continue to assess Harvard’s capacity to sustain this commitment and will communicate any changes,” Lapp said.
Harvard is the nation’s richest college. The university’s $41 billion endowment has often drawn criticism from those who say the university should tap into its wealth to support its institution, its staff, and its students during times of great distress.
In fact, a number of top schools turned down stimulus checks in April after facing backlash from some Republican lawmakers, who said the pandemic relief should first go to institutions without deep pockets. After turning down its stimulus check, Northwestern University said it would temporarily tap into its $11.1 billion endowment to support the school.
But investment chiefs say endowments are meant to sustain the institution in perpetuity, so the school can also continue to support future students.