Retirement Incentive Plan for Faculty
Date of Current Revision: March, 2012
Responsible Officer: Director of Human Resources
This policy exists to describe the James Madison University Retirement Incentive Plan for Faculty (RIPF).
This plan has been created under the direction of the Board of Visitors and is in accordance with the University Faculty Handbook.
The offer of certain compensation and benefits associated with a faculty member retiring prior to what would be considered ‘normal’ retirement in terms of age and/or length of state service.
Contractual Right to Employment
For the purposes of this policy, a contractual right to continued employment refers to a faculty member who has a contract with a termination date more than one year in the future.
To be eligible to be a participant under the plan, a person must:
The James Madison University Retirement Incentive Plan for Faculty provides supplemental retirement benefits to participating faculty members to meet critical university objectives. Participation in the plan is voluntary for both the university and the faculty member.
With the approval of the president the university may exercise its discretion to extend an offer of early retirement to an eligible faculty member when such an offer is strategically intended to enhance the university’s performance of its mission and achievement of its defining characteristics.
The objectives of the plan include:
1. To provide the university with increased flexibility in the allocation of faculty positions among programs in order to better meet enrollment demands and curricular needs.
2. To facilitate the hiring of new faculty members who have credentials and experiences that will best support and enhance the mission of the university
3. To help alleviate the financial strain of retirement that may prevent some faculty who would like to do so from retiring.
6.1 Selection of Participants
Criteria for selecting participants from among the eligible applicants will be established by the university based upon policy objectives. Selected participants will be recommended by the deans to the President and the Board of Visitors for final approval.
6.2 Retirement Contract
The university and each participant will enter into a retirement contract that will include provisions covering the following matters:
6.3 Annual Payments
Aggregate payments pursuant to this policy in any year may not exceed five percent (5%) of the university’s educational and general fund appropriation for faculty salaries and benefits for that year. However, the actual amount allocated by the university for payments pursuant to this policy in any year will be determined by the needs of the university, and the university will not be obligated to allocate the maximum amount described in the preceding sentence.
6.4 Qualified Defined Benefits Plan
Benefits under this policy will be provided through the James Madison University Supplemental Retirement Plan for Faculty (SRPF). The SRPF is intended to be a qualified defined benefit plan pursuant to the Internal Revenue Code of 1986, as amended. Benefits under the SRPF are intended to supplement any retirement benefits the participant may be receiving from the VRS and/or the optional retirement program (ORP) and to help alleviate the financial strain of retirement. By adopting this policy, the university’s Board of Visitors (Board) hereby adopts the SRPF provided that its terms are consistent with this policy. The Board hereby gives the President of the university the authority to execute the SRPF and any amendments required by the Internal Revenue Service in order for the SRPF to gain qualified status, provided said amendments are consistent with this Policy.
The President and Board of Visitors are responsible for final approval of this policy as well as individual early retirement offers.
Deans and division heads are responsible for identifying candidates for the Retirement Incentive Plan.
The Human Resources Benefits Team is responsible for managing the RIPF contracts and providing one-on-one counsel with applicable faculty members.
Sanctions will be commensurate with the severity and/or frequency of the offense and may include termination of employment.
This policy excludes any and all employees who do not meet the criteria as established in Section 4 above.
The authority to interpret this policy rests with the President, and is generally delegated to the Director of Human Resources.
Previous Version: July, 2010
Approved by the President: April, 2002
Index of Terms
Faculty Early Retirement