The Moon Room

A Community Forum on Guilford College Faculty Life

Flat fees and fair compensation

December 11th, 2017

Flat fees, such as our healthcare costs or the recently proposed parking fee, provide a much more significant burden on low-wage employees than on high-wage employees. This is just basic math. When a cost or fee is constant, then it represents a higher percentage of income for a low-wage employee than for a high-wage employee.

Consider two cases below – a low-wage employee making $35,000 a year, and a vice president making $175,000 a year.

 

Both pay the same costs for Guilford’s healthcare. For an employee supporting a family, that will be $9390 next year. That cost is fixed, and therefore regressive by income. Social security tax is capped, making it regressive at high incomes, so high-wage earners above the cap actually pay a lower percentage than lower-wage earners. The VP pays more Social Security tax in total, but at a lower rate. Medicare is a constant proportion (not capped, so neither progressive nor regressive).

If we look at these employees’ listed salary, the VP makes five times as much as the low-wage employee. But the capped taxes and flat-rate costs exacerbate the inequality. After we deduct the Social Security, Medicare, and health insurance expenses, the VP takes home nearly seven times as much as the low-wage employee.

If we add another constant fee, say $120 for parking for the year, that money comes out of the take-home pay. The fee is the same for all employees, so that fee represents about half a percent (0.5%) of the low-wage earner’s take home pay, while it makes up less than a tenth of a percent (0.08%) of the VP’s take-home pay. By comparison, Medicare taxes are 1.45% of salary, or ~2% of take-home.

In other words, a flat $120 annual parking fee has an impact as much as seven times as great on our lowest-paid employees as on our highest. That’s textbook regressive. It represents about ten and a half hours of work for the low-wage earner, given directly back to the college, and only one and a half for the VP.

We can do better. For that matter, we should do better with our health insurance also.

Comments

8 Comments

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  • Julie Burke says on: December 11, 2017 at 7:57 pm

     

    Thank you for your passionate, direct, emotionally – charged yet highly rationale response.

  • Hildreth says on: December 12, 2017 at 9:16 am

     

    I am at a loss re. the total lack of communication from (some of) the decision makers/power players that is going on right now here on campus. From the recent increase in health care (which I get needed to be adjusted in some capacity) with no heads-up, to this…just blows me away. At minimum, not providing faculty and staff a heads-up to changes, big or small, is just plain rude…. Oh where has transparency gone….?

  • Gail Webster says on: December 12, 2017 at 11:06 am

     

    There continues to be no transparency, and there is no faculty input into the “shared” governance of the college. Why is the budget committee not meeting? Who made the decision for the college to be self-insured?

  • Eva Lawrence says on: December 13, 2017 at 8:41 am

     

    I too was shocked to see this fee applied unilaterally and without any input from Benefits committee. At the same, I realize that the College is faced with more layoffs and the estimated $36,000 generated from this fee might mean that one less person gets fired this year. Most faculty are relatively protected by this fear of getting fired, but it is something that staff deal with on a day to day basis.

    Would I pay $120 so that someone can keep their job? Without question. Would I pay even more than $120 so that someone could keep their job and the lowest paid workers don’t have to be burdened by a fee? Definitely.

    This past year, I feel like we as a faculty have so reactive rather than proactive. There was an outcry at the beginning of the year about one staff member from IT who lost their job, wouldn’t it be nice if we as faculty could do something more tangible than just lament the loss of someone’s job but actually be proactive in helping to keep it?

    I realize this isn’t so simple, but I would feel so immensely proud to be a faculty member at Guilford if our response to these fees included some solution that might affirm our commitment to social justice: If we said “no” to unilateral parking fees for no clear end, but instead said “yes” to a fee that was earmarked for staff salaries and a fee that differed based on the employee’s salary – so that the lowest paid workers at the college paid nothing for parking and the highest paid administrators paid the most.

    I realize this is the idealist in me speaking. I in no way am trying to discount others who genuinely believe this will be a hardship for them financially. But, I assume that most people who are concerned about this fee are concerned because of the symbolism behind it, not that actual money. I think a symbolic response is therefore in order, for us to stand up for the lowest paid workers in a tangible way, acknowledge our privilege as faculty members, and hold the top paid administrators accountable for their privilege.

  • Julie Burke says on: December 13, 2017 at 8:50 am

     

    I agree with Eva whole -heartedly about being proactive. I also agree that I would be supportive and contribute without ill feeling to a fund earmarked for staff position security.

    There is, however, another issue not raised in Eva’s message and that is the notion of transparency and consistency in decision – making practices here on campus. I believe that more than the fee itself, or in addition to the fee itself, the much bigger issue is the disregard of practice and policies for decision – making. This may be reactive, and not proactive, though I think speaking up is a form of activity.

    The things we are doing, and having done “to” us or “for” us are not in keeping with the spirit or the practice of our principles of governance.

    I object more to the way both the insurance and the parking fee mandates were made than in the changes themselves.

  • Eva Lawrence says on: December 13, 2017 at 10:26 am

     

    I agree with Julie’s comment and didn’t mean to gloss over the governance and transparency issue. I believe that coming back with an alternative proposal that raises the same amount of revenue but does so in a more socially just way is actually a way for us to to take back our governance – at least symbolically.

    If we just respond with “we are against the policy” without coming up with a reasonable solution, it will likely feed the narrative that I think Jane and the administration (and some staff) might already have about us (incorrectly, I think) – that we cannot govern ourselves (aka, get shxx done) and that we are only out for our own self interests.

    I absolutely believe in the power of saying no and being obstructive, by the way. I’m just not sure this is the issue that we want to draw a line in the sand for.

  • Gail Webster says on: December 13, 2017 at 10:41 am

     

    Not every person is in the same financial situation on our faculty. With the over $9000 fee for health insurance that I will now incur to provide health insurance for my family, an additional $120 is not feasible for me. I know that’s just me, but I imagine it’s a burden for others as well. I work so that I can provide for my family. They are my first priority.

    Perhaps, if faculty were allowed to give significant input on the Budget Committee and the Benefits Committee, we could be more proactive than reactive.

    • Hildreth says on: December 13, 2017 at 6:09 pm

       

      I agree with everyone in that we need to be proactive in advocating for our beliefs and there is clearly a need to rediscover transparency here on campus. I also agree with Gail; although I would love to help, my health insurance was also raised 120 a month, in addition to the 10 buck bonus parking treat for a cool 130ish less per month this year when compared to last. And, I also have two kids in college. I fully realize my good graces, but others need to consider that many faculty are constrained in ways that others may not know about. As such, when there is a discussion about giving up part of one’s salary, it makes some of us (or at least me) feel awkward as I (we) can’t, unfortunately, do likewise. (Not fussing at anyone here because I dig the concept, just a point for consideration.)

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The Moon Room

A Community Forum on Guilford College Faculty Life