Q1: What is the Voluntary Retirement Incentive Program?
The university is offering the Voluntary Retirement Incentive Program to retirement-eligible employees. This program provides these employees the option to retire now and receive enhanced salary and benefits coverage for a defined time after retiring from the university. The features of the program are as follows:
- Pay continuation: A payment equal to 4% of his/her Base Pay per full year of Wright State service, up to a maximum of 25 years, payable in three substantially equal installments; capped at $85,000.
- Medical benefit: Receive a Health Reimbursement Account, or HRA, contribution from the university of $5,000 per year for three years to use toward eligible health expenses, such as purchasing coverage outside the university and paying for deductible, copayment and coinsurance costs for medical services and prescription drugs.
- Maximum offer: The total amount of the offer (pay continuation and medical benefit) is capped at $100,000.
In addition, for those who have an interest in continuing to receive medical coverage for themselves and eligible dependents under one of the Wright State medical plans offered (i.e., AAUP PPO 90/10 Plan, PPO 90/10 Plan, AAUP PPO 80/20 Plan, PPO 80/20 Plan, AAUP HDHP Plan or HDHP Plan , the university will provide a special subsidized COBRA rate that will cover 50% of the COBRA rate for up to three years.
As is standard practice and pursuant to the university’s policy, employees will be paid for any unused, accrued sick time (with 10 years of state service) and/or accrued vacation time after their employment with the university ends. Details are explained in the Wright Path to Retirement brochure available by visiting www.wright.edu/hr.
Separation dates must be effective by:
- September 30, 2016 for staff employees
- December 31, 2016 for faculty employees
 Medical plans are subject to change annually and you will have the opportunity to change your selection during open enrollment within applicable plans.
Q2: When and how will my pay continuation payments from the Voluntary Retirement Incentive Program begin?
Payments will be issued through University Payroll using the following installment schedule:
- The first annual installment shall be payable no earlier than the January 1 coincident with or immediately following the employee’s retirement from service and no later than the January 31 coincident with or immediately following the employee’s retirement from service.
- The second annual installment shall be payable no later than the first December 31 following the first installment.
- The third annual installment shall be payable no later than the second December 31 following the first installment.
Q3: Will taxes be taken from my pay continuation payments?
Yes, applicable taxes will be withheld.
Q4: Will W-2s be prepared on my behalf by the university?
Q5: What is a Health Reimbursement Account and what can it be used for?
A Health Reimbursement Account, or HRA, is a tax-advantaged account the university will establish for you. It will be administered by myCafeteriaPlan, our flexible spending account administrator. Access to the HRA funds will be available beginning on the first of the month following your separation date. (This will align with the effective date of COBRA benefits if you elect them.)
You can use the money in the account to pay for eligible expenses you and your eligible dependents incur, such as purchasing coverage outside the university and paying for deductible, copayment and coinsurance costs for medical services and prescription drugs.
Any amount remaining in your HRA at the end of the year will roll over and can be used in future years. At the end of the three-year period, you will have an additional nine months to incur expenses. Then, you have until the end of Year 4 to submit all reimbursements. HRA funds remaining after that 12-month period will be forfeited.
For a list of eligible expenses, please refer to IRS publication 502, which can be found at https://www.irs.gov/pub/irs-pdf/p502.pdf.
For more information about the account, please contact HR.
Q6: Why did the university choose to provide $5,000 per year in the form of HRA contributions rather than in cash?
Contributions made by the university to the HRA are not included in your gross income; therefore, they are not taxable. This enables you to utilize the entire amount. Cash would be considered gross income and, therefore, reduced for taxes.
Q7: When I use funds in the HRA, are they taxed?
Since you may only use the funds to pay for eligible expenses you and your dependents incur, they are not taxed. For a list of eligible expenses, please refer to IRS publication 502, which can be found at https://www.irs.gov/pub/irs-pdf/p502.pdf.
Q8: Are there fees associated with the HRA?
Yes. There is an administrative fee of $3.50 per month that will be deducted from your account balance.
Q9: Why is the university offering this program?
To address budgetary issues, the president asked the university to look at all cost-cutting opportunities, while maintaining the people-friendly approach we value. We specifically explored ways to reduce the budget used for salary and benefits for faculty and staff employees. As a result, the university will offer the Voluntary Retirement Incentive Program to retirement-eligible employees.
Q10: Who is eligible for the program?
Employees eligible to take their retirement benefit, reduced or unreduced, by September 30, 2016 (for staff employees) or by December 31, 2016 (for faculty employees) are eligible for the voluntary retirement incentive program.
Retirement eligible is defined by the system or plan in which employees participate as follows:
- The State Teachers Retirement System, or STRS, defines retirement eligible:
- In the Defined Benefit Plan: At any age with 31 years of service or age 65 with 5 years of service for an unreduced retirement benefit, and at any age with 30 years of service, age 55 with 26 years of service or age 60 with 5 years of service for a reduced retirement benefit.
- In the Defined Contribution Plan: At age 50 with any service requirement.
- The Ohio Public Employees Retirement System, or OPERS, defines retirement eligible:
- In the Defined Benefit Plan: At any age with 30 years of service or age 65 with 5 years of service for an unreduced benefit, and at age 55 with 25 years of service or age 60 with 5 years of service for a reduced retirement benefit.
- In the Defined Contribution Plan: At age 55 with any service requirement.
- The Ohio Public Employees Retirement System-Law Enforcement, or OPERS-LE, defines retirement eligible as age 48 with 25 years of service or age 62 with 15 years of service for an unreduced retirement benefit, and at age 52 with 15 years of service for a reduced retirement benefit.
- The Alternative Retirement Plan, or ARP, defines retirement eligible as age 59½ with any service requirement.
Those not eligible include employees who previously retired from the university prior to May 2, 2016; part-time, on-call employees; special contract employees; and those given notice by the university prior to May 2, 2016.
Eligibility for the program is open to retirement-eligible employees only and ensures that we will retain an appropriately-staffed and qualified community to meet the needs of the university and the student body.
- The State Teachers Retirement System, or STRS, defines retirement eligible:
Q11: How many employees are eligible for the program?
According to the university’s records as of June 2, 2016, more than 500 employees are or will be retirement eligible by the program separation dates (September 30, 2016 for staff employees and December 31, 2016 for faculty employees). However, the university does not have access to employees’ STRS, OPERS, OPERS-LE or ARP records. If you think you are retirement eligible, please contact the STRS, OPERS, OPERS-LE or ARP, respectively, and provide HR with documentation of your qualifying age and years of service.
Q12: How will I know if I’m eligible?
If you are eligible according to the university’s records, you will receive an announcement letter and a decision packet. If you did not receive a decision packet, then you are not eligible based on your age and service requirements on file with the university. If you did not receive a decision packet and think you are retirement eligible, please contact the STRS, OPERS, OPERS-LE or ARP, respectively, and provide HR with documentation of your qualifying age and years of service.
Those not eligible include employees who previously retired from the university prior to May 2, 2016; part-time, on-call employees; special contract employees; and those given notice by the university prior to May 2, 2016. Staff employees who are not retirement eligible as of September 30, 2016, are not eligible to elect the program. Faculty employees who are not retirement eligible as of December 31, 2016, are not eligible to elect the program.
Q13: How did the university determine the program offering?
The program design and eligibility were determined using a thoughtful process led by members of the leadership team, including the Provost/CAO, Vice President for Business & Finance/CFO, Associate Provost for Faculty and Staff Affairs, and Associate Vice President & Chief HR Officer. The AAUP-WSU reviewed the program details for its members and offered input that led to further improvements in the program. In addition, the university received guidance from an external consulting firm, Mercer, with expertise in designing and assessing retirement programs and benefits.
Q14: Is the program voluntary?
Yes, the program is voluntary.
Q15: Will I be subject to involuntary reduction if I do not take the program offer?
The process for determining employees eligible for the program is very different from the process for identifying those who may receive an involuntary reduction. For Bargaining Unit Faculty Members, involuntary reductions are addressed in the Collective Bargaining Agreements between the University and AAUP-WSU. When involuntary reductions in staff or non-bargained unit faculty are necessary, the process is narrowly focused and examines factors such as performance, specific contractual and business obligations, essential functions of the position and individual department budgets. These factors are not part of the Voluntary Retirement Incentive Program. Employment status will not be affected because you choose to decline this offer.
Q16: What are the key dates and deadlines for the program?
- Week of June 20: Announcement letter to eligible employees
- Week of June 27: Decision packets (via mail) to eligible employees and posted to HR website
- July 1, 8 a.m. ET: Election window opens
- July and August: Education sessions held at the university (details of the sessions will be communicated once finalized)
- August 15, 4:30 p.m. ET: Election window closes
- September 30: Separation date for staff employees*
- December 31: Separation date for faculty employees*
* In some instances an alternative separation date to what’s listed above may be permitted due to critical program/operational need or multiple employees leaving from the same unit. Guiding principles for permitting alternative separation dates will be provided by the Provost’s office. You may consult with the Vice President of your division or Chair/Dean of your college about a possible alternative separation date. Approval for or rejection of a proposed alternative separation date will be made by the Provost. For Bargaining Unit Faculty Members (BUFMs), the AAUP-WSU will have the opportunity to grieve any Provost decision of BUFM alternative separation date requests that do not adhere to the guiding principles. Faculty members who separate after August 15, 2016, will need to complete their fall semester duties, including submission of final grades.
Q17: I may be interested in this program. Is there a deadline for making a decision?
The election window will be from Friday, July 1, 2016 through Monday, August 15, 2016. Eligible employees must submit their election forms in person no later than Monday, August 15, 2016 at 4:30 p.m. ET to be eligible for the program. Hours of operation for the Human Resources team are 8:00 a.m.to 4:30 p.m. ET, Monday through Friday. The office is located at 115 Medical Sciences Building.
Q18: Should I elect the program?
This is a personal decision that is up to each eligible employee. By law, the university can only provide factual information and cannot give any advice. Employees are encouraged to seek the advice of financial, tax, and/or legal advisors before making a final decision.
Q19: What if I elect to participate in the program then change my mind?
Before you submit your election forms, be certain of your decision. You have seven days from the end of the election period, which is August 16, 2016 through August 22, 2016, to revoke your election. If you wish to do so, a request to rescind election form is available on the HR website and must be delivered in person or via registered mail by August 22.
Q20: Will another similar program be offered in the future?
This is a one-time voluntary program designed to meet the university’s current and future needs. There are no plans to offer another program at this time.
Q21: Once I retire from the university, what benefits and programs am I eligible for?
Q22: Am I still able to defer my vacation and, if applicable, sick leave payout, into a Supplemental Retirement Account?
Yes. You can elect to defer any portion of your vacation and, if applicable, sick leave payout, to one of our Supplemental Retirement Accounts, 403(b) or 457(b), up to the IRS limits. However, to do so, you will need to set up your account with an approved provider from the list available on the HR website, and you will need to email HR-Benefits@wright.edu with the amount you wish to defer, the account type, the provider name and the date of your retirement.
In addition, please be aware of the IRS-driven timeline for both the account setup and email:
- For 457(b), per IRS, you must take action at least one month prior to your retirement date.
- For 403(b), you have until the 10th day in the month of your retirement.
- For 457(b), per IRS, you must take action at least one month prior to your retirement date.
Q23: Am I permitted to return to work for the university if I elect to participate in the Voluntary Retirement Incentive Program?
No. You are not eligible to work for the university if you elect to participate in the program, unless you are working for a temporary agency or adjunct teaching. The mechanism to return as an adjunct, while receiving the Health Reimbursement Account (HRA), is hire through our temporary agency.
Q24: If I elect to participate in the program, can I collect unemployment?
Because election of this program is voluntary, it is unlikely that employees will be able to collect unemployment.
Q25: What do I need to do to elect my participation and declare my retirement?
We suggest these steps to elect your participation and prepare for your separation from the university:
- Read the materials in your decision packet.
- Attend an educational session to learn more and get your questions answered. (Details of the sessions will be communicated once finalized.)
- Contact STRS, OPERS, OPERS-LE or ARP representatives for pertinent and relevant details on your retirement.
- Consider seeking the advice of financial, tax, and/or legal advisors before making a final decision. In addition, you may wish to contact the Social Security Administration to be fully aware of your Social Security retirement and Medicare benefits and when benefits begin.
- Contact HR if you have any questions about the program.
- Sign and return your hardcopy election forms in person or by registered mail to HR no later than the end of the election window, which is 4:30 p.m. ET on Monday, August 15.
- Finalize your retirement in a timely manner with STRS, OPERS, OPERS-LE or ARP. The respective retirement system will notify HR.
- Inform your supervisor and work with your department to transition your responsibilities to other employees in advance of your separation date.
Q26: What do I need to do to decline my participation in the program?
Please notify HR of your decision in a timely manner prior to the end of the election window. If you do not provide HR with a response by the end of the election window, the university will assume you have declined the offer.
Q27: If I have questions, whom do I contact?
Wright State University HR
115 Medical Sciences Bldg.
Phone: (937) 775-2120
Website: www.wright.edu/hr (click “Benefits” then “VRIP”)
Wright State Retirees’ Association
Ohio Public Employees Retirement System (OPERS) or Ohio Public Employees Retirement System-Law Enforcement (OPERS-LE)
Phone: (800) 222-7377
State Teachers Retirement System (STRS)
Phone: (888) 227-7877
Alternative Retirement Plan (ARP)
myCafeteriaPlan (HRA administrator)
UMR (COBRA administrator)
Phone: (800) 207-1824
Q28: What is COBRA?
COBRA (Consolidated Omnibus Budget Reconciliation Act) allows you and/or a dependent covered under medical, dental, vision and/or health care Flexible Spending Accounts benefits to continue coverage when it is lost due to any of the following qualifying status changes:
• Termination of employment (unless termination is the result of gross misconduct)
• A reduction in the number of hours of employment that affects benefits eligibility
• Divorce or legal separation/termination of same-sex domestic partnership
• Employee’s death (for eligible dependents)
• Child ceases to be eligible for coverage
Coverage may be purchased for any or all persons on your policy at the time of termination.
If you elect to participate in the Voluntary Retirement Incentive Program, the university will provide a special subsidized COBRA rate that will cover 50% of the COBRA rates for up to three years.
UMR, WSU’s COBRA administrator will send enrollment information to you and/or your eligible dependents within 14 days after your retirement.
You and/or your dependents have 60 days after your retirement date or the date COBRA enrollment form was sent, whichever is later, to elect COBRA coverage and return the enrollment form to UMR.
You and/or your dependents have 45 days after making your election to send your premium payment to UMR. Coverage will be reinstated to the first of the month following your retirement.
The earlier you make your COBRA payment, the faster your healthcare will be reinstated.
United Medical Resources (UMR) is available to answer questions at (800) 207-1824, or feel free to direct questions to firstname.lastname@example.org.