Introduction

This document provides instructions, some frequently asked questions and summarized benefits data from the 2016-17 AAUP FCS for data managers. There are few things to keep in mind for any benefit you report:

  1. You should only report benefits for full time faculty reported on Form 2 and at their rank (if benefits are reported by rank) on Form 2. If you report them as 9 month faculty on Form 2, report them as 9 month faculty on Form 3 even if you pay medical and other benefits for 12 months.
  2. Only Employer contributions are reported. Employee contributions should NOT be included in the data reported.
  3. If projections or estimates are used, they should be for actual expenditures for current faculty. Actuarial costs that are not actually spent in the current academic year should not be included.

In Form 3, the number covered for each benefit is the number of faculty members (of those reported on Form 2) for whom a benefit amount was paid. For tuition especially, this is only the number of faculty for whom a tuition amount was (or will be) actually paid in a given year–not the number who were potentially eligible to receive such payments. Note that the number is of faculty, not a total number of persons (dependents) covered.

Projections/Estimations of Benefits

For some benefits, final numbers may not be available by January 26, 2018 for the 2017-18 academic year. You can use estimates or projections. For example: Tuition is not finalized by January 26. There are several possible estimation techniques.

  1. Project, based on past spring semesters, what the tuition expenditure.
  2. Use the fall semesters as an estimate of the spring semester.
  3. Use the spring numbers, even if before the census date.
  4. Any internal institutional practice that produces a reasonable estimate.

If there is anything you want us to know or are concerned about: contact us at aaupfcs@aaup.org

Remember that survey data can be continuously updated until June 2018 in the web portal. We publish updated tables in July.

Ranked versus Unranked Benefits

When you begin filling out form 3 online, you will be prompted to mark whether your are submitting data by rank or simply total benefits for all ranks. In either case, institutions should only report benefits for those full time faculty included in form 2. ## Conversion Factors for 11/12 month faculty Benefit expenditure amounts for 11- and 12-month faculty that are not generally figured as a percentage of salary are not converted. These include medical, dental, disability, tuition, unemployment, and “other” benefits. Other items will be converted using the factor entered in Form 2. If you provided only converted salary figures in Form 2, please follow the same procedure in Form 3. We only convert (with the institutional conversion factor) the following benefits: FICA and Retirement. All others are not weighted with the institutional conversion factor. We encourage institutions to enter a conversion factor. We recommend 9/11 or .818181 that is traditionally used. If you do not enter a conversion factor on Form 1, we will replace empty conversion factors with 1.0 .

FICA

FICA (Federal Insurance Contributions Act) benefits are made of two components: 6.2 % OASDI (Social Security) and 1.45% HI (Medicare) of wages with a total 7.65 % of wages. There are two components to what is withheld: an employer and employee contribution. For OASDI, the contribution is applied up to the Social Security Wage Base (SSWB) for 2017, $127,200 and for 2018, $128,400. Medicare is applied to all wages, even above the SSWB while there is an extra medicare tax (but not employer contribution) required for individual income over $200,000 ($125,000 Maried, filing separate and $250,000 married filing jointly).

This value gives us an important quality indicator for the submitted data. It tells us if an institution might mistakenly be including employee contributions in the submitted benefits data (if an institution’s FICA percent of average salary is near 15.3 %) or if an institution might have included some non-salary compensation in the calculation of aggregated benefits (if FICA is 7.7 % to 10 %). FICA above 7.65 % will generate an error in the portal and the research office will follow up directly with an instituion. FICA below 7.65% is not an error and is possible because of the SSWB. From an institutional research perspective, this number gives insight into salary distribution: the more highly compensated employees a cohort has (i.e. faculty with wages greater than the SSWB), the lower FICA is as a percent of overall salary.

There is one set of exceptions to FICA benefits: some public institutions are exempt from either OASDI or HI, or both. In those cases, there is no FICA contribution (or just the 1.45% medicare component).

In the above plot, each graph represents a particular institutional control (Public, Private (Non-religuously affiliated) and Private (Religiously affiliated) by rank (rows). Examining the above graph there are two lines plotted: A pink one at 1.45% and a green one at 7.65%. This indicates the required contribution for Medicare and the additional Social Security contribution. Public Universities are the only ones with several institutions around 1.45%–some employees of some state and local governments are exempt from Social Security and Medicare (one or both). This is relfected in the distribution of FICA benefits in public institutions.

Retirement

Include the contribution by the institution, state, and/or local government to the retirement plan(s) but exclude payments for unfunded retirement liability. Retirement should not include any projected amounts for post-retirement benefits, even though these are shown on institutional budget and financial statements. Amounts paid to retired faculty should also not be included. We are looking for actual expenditures for current faculty. Contributions to the Emeriti plan (or similar plans to provide for faculty health care after a future retirement) paid by the institution on behalf of active faculty members who are reported in Form 2 of our survey should be included in the Form 3 benefits figures under Retirement. The Emeriti plan is not a retirement pension; however, the accounts will provide for health care once the faculty member is retired, and that is why it should be included in the retirement line. Only the institution’s contribution should be included.

If you are a public institution and a state or local goverment makes these contributions on the institutions behalf, these contributions should be included in the reported data.

Vesting/Portability Periods

This can be complicated, but essentially we are looking for the reporting of actual expenditures even if the employee may not get to keep them until a specified period has passed. You can report benefits that accrue, even if they are not portable or the employees is not vested. Do not report non-accrued benefits. Two examples:

  1. There is 5 year vesting period for a pension plan, but the employer contributions start the first day of service at 11% of salary: INCLUDE even if faculty has less than 5 years of service.
  2. For a 401 (k) plan, the institution makes a 5 % contribution after the beginning of the 3rd year of service: Do not include 5% contribution for faculty until 3rd year of service.

Medical and Dental Benefits

There are three lines for reporting medical/dental benefits.

  1. Medical: Include premiums for insurance plans which provide medical, hospital, prescription drug plans, surgical, and/or vision benefits.
  2. Dental: Include premiums for dental insurance.
  3. Combined Med/Dental: This line allows for reporting medical and dental insurance expenditures combined. Please provide these items separately, but if this is not possible, this line is for institutions who are not able to separate the two expenses.

Only complete lines 1 and 2 or line 3. There should not be data in lines 1,2 and 3.

Disability

Include expenditures, through insurance or otherwise, for long-term disability income protection, defined as salary in excess of six months and not covered in other retirement or insurance plans. Do not include payments for accumulated unused sick leave. Do we include short term disability? No. On the benefits section of our survey, we try to maintain compatibility with the definitions previously used by IPEDS. Our survey instruction on this point was taken directly from the IPEDS definition. “Long-term” is defined as “in excess of six months.” The inclusion of short term disability may happen in the future, but for this year we will keep the same instruction for this as in prior years.

Workers Compensation

For “Worker’s Compensation,” the amount to be reported on the survey should be the premium paid, not the actual benefits paid to individuals with claims. Workers’ compensation is actually a form of insurance. Although all states require some type of workers’ compensation insurance for qualifying employers, the actual coverage and the forms the insurance may take vary from state to state. Premiums for workers’ compensation will be part of a business insurance package. Some states offer (or even require participation in) state-sponsored plans, and some states may also levy a tax on premiums. (If so, include that tax as well.)

Unemployment Benefits

Although frequently labeled “Unemployment Insurance” (UI), employers are required to pay this tax by both federal and state law. Federal unemployment tax (FUTA) is reported on IRS Form 940 or 940EZ. The Federal rate for unemployment insurance is 6.2% on only the first $7,000 of an employee’s wages; this rate has remained steady since at least 1996. State rates and the wage base for taxation vary. Payments for state unemployment taxes can be offset against the federal tax, meaning that the effective total rate for most employers is 6.2% of the first $7,000 of wages, and slightly higher in those states with a higher taxable wage base. Respondents should report the combined Federal and State expenditures, using actual figures where possible and an estimate otherwise.

Group Life Benefits

Include expenditures by the institution for life insurance premiums. If you pay an aggregate amount (rather by person), you can divide the total amount divided by number of faculty covered to get a per-person amount to include in the report.

Tuition Benefits

Include both cash payments and the dollar value of tuition waivers and exchanges for faculty dependents. Note that for tuition, the number covered is the number of actual faculty members rather than the number of faculty eligible or the faculty dependents using the tuition waivers or exchanges. As with the medical benefits, the total expenditure should include money spent for faculty dependents.

Other Benefits

Other Benefits include benefits in-kind with cash alternatives. These benefits are those for which the institution provides an option of taking a cash payment if the individual prefers to use the money in some other way. Since the objective is the measurement of income available for personal consumption, as distinct from professional purposes, professional benefits (e.g., conference travel, membership fees, grading assistance, faculty clubs, etc.) should not be included. Examples: 1. Meal plans, housing support, etc. 2. Buy out for medical insurance (some institutions, if a faculty member uses a spouses medical plan, reimburse the institutions plan cost to the employee).

The instructions for this item state that “the objective is the measurement of income available for personal consumption, as distinct from professional purposes.” Therefore, payments for travel to conferences, research grants or stipends, and professional membership dues should not be included (and are not reported for the survey).

Total Benefits as Percentage of Salary

This is the total expenditure divided by the maximum amount covered for all benefits – it represents more of an average expenditure per faculty member rather than a representation of all possible benefits. In order to calculate the percent tuition above, I used the number covered as the demoninator. For TBPS, however, I used the maximum number of individuals covered by any given benefit in the demonator.

\(\textrm{Avg Percent Tutition Benefit} = \frac{\textrm{Total Tuition Benefit Expenditure}}{\textrm{Number FT Faculty Covered for Tuition}}\)

versus

\(\textrm{Avg Total Benefit as Percent of Salary} = \frac{\sum(\textrm{Benefit Expenditures)}}{max(\textrm{Number FT Faculty Covered for any benefit})}\)