Dear colleague,
Our unions have been working to permanently fix New Jersey’s inflated fringe rate that harms research at Rutgers. As you know from previous messages, the fringe benefit rate is money that comes off the top of every grant that comes into Rutgers to pay for benefits from state programs such as health insurance. The fringe rate in New Jersey is more than double or even triple what researchers at institutions in other states pay, in large part because the state takes an inflated sum to fund a pension program neither faculty nor grad workers nor nor postdocs at Rutgers are part of.
For several years, we’ve won temporary funding to offset the inflated fringe rate, while we continue to work with the governor’s office and legislators to get a permanent fix in place. At a recent meeting with staff from the governor’s office to discuss a cap on the retirement portion of the fringe rate at 8 percent, we learned that Rutgers has been overcharging for postdoc fringe benefits for as long as 14 years—because the state had already waived the collection of postdoc retirement contributions. The final cost of this overcharge is unclear, but we estimate it might be as much as $47 million.
Here’s what happened: In March 2010, the then-director of the state’s Office of Management and Budget notified the Rutgers administration (read the memo here) that in the case of graduate workers, they would only have to reimburse the state to cover health benefits (since TA/GAs didn’t qualify for other benefits such as retirement)—and in the case of postdocs, Rutgers could exclude the pension component of the fringe since most postdocs aren’t eligible for retirement benefits based on visa status (eligible postdocs should still receive retirement benefits).
The administration appears to have followed this directive regarding grad workers—but continued to charge the full pension portion of fringe for postdocs. In other words, the state fixed the fringe for postdocs and grad workers years ago. But the administration didn’t follow the state directives.
We wanted to let you know about this apparent multimillion-dollar blunder because so many of you have expressed frustration about the high fringe rate in New Jersey—and you helped our unions put pressure on officeholders to fix the fringe over the past several years. We have written to President Holloway’s administration (read our letter here) to demand that they immediately stop collecting the pension portion of fringe for postdocs—and explain why tens of millions of dollars were wrongly collected over the years.
We still need to permanently fix the fringe rate so faculty aren’t overcharged for a pension program they aren’t part of. But Principal Investigators overseeing grants should get immediate relief when the administration stops overcharging for postdoc positions!
In solidarity,
Todd Wolfson, President, Rutgers AAUP-AFT
Dr. Catherine Monteleone, President, AAUP-BHSNJ
Andrés Morera, Vice President for Postdocs, Rutgers AAUP-AFT
Matthew Buckley, Legislative Committee Chair, Rutgers AAUP-AFT
Vik Meadows, Postdoc, Biological Sciences, Rutgers New Jersey Medical School, Newark
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