U of A graduate students and postdoctoral fellows against the semi-monthly pay cycle change
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Greetings graduate students and postdoctoral fellows,
As you may have heard the University of Alberta is implementing a new semi-monthly pay cycle for NASA staff, graduate students and post-doctoral fellows on campus. On the surface this proposal seems innocent and even perhaps beneficial to all parties involved, however the fine details of the University's new “Service, Excellence and Efficiency Plan” reveal that the aforementioned members of the University, those that hold the fewest available resources, will actually be disadvantaged by this plan.
The plan states: “The semi-monthly pay cycle will consolidate the current monthly and biweekly pay cycles into a combined pay cycle featuring two pay periods per month.” Reading further reveals that the pay period will be shifted so that “payment for the 1st to the 15th of the month will be paid on the 25th, payment for the 16th to the last day of the month will be paid on the 10th of the next month” meaning that in the first month of it's implementation, July 2012, only one payment will be made on the 25th consisting of the pay for July 1-15th, resulting in a paycheque that is half its normal amount. For employees that do not make a significant salary (like students making only $1200-1600/month) this will be a major hardship. However, the University has a plan to prevent this.
The announcement page says: “A one-time cash advance will be available to eligible salaried staff, postdoctoral fellows and graduate students to help adjust to the new pay cycle. The advance will be available upon request and would be repaid over a period of up to 24 pay periods.” This sounds just fine but reading the details of this advance reveals the following: “Eligible persons may choose the one-time cash advance in any amount up to 70% of their July 1, 2012 semi-monthly base salary...Base salary does not include scholarships, overtime, responsibility pay, shift differential, one-time payments, scholarships or other supplements.” Elsewhere on the site there is this calculation: “While the advance is not taxable, the taxable benefit that a member pays on the 1% interest as assessed by the Canada Revenue Agency will be relatively small. For example, if you were to choose a cash advance of $2,000 repayable back over the maximum of 24 pay periods, you would repay $91.38 each pay period and be assessed a taxable benefit of $0.83 per pay period.” For students, who do not pay taxes and therefore will not get this taxable benefit, and choose to pay this back over 24 months will actually pay back 109.65% of the original advance. Additionally this clarification is also made: “If you only receive scholarship payments, you are not eligible for the cash advance on this payment type.” so many students will not qualify for the advance at all.
Many students and fellows live paycheque to paycheque and expecting an individual to absorb an $800 or higher decrease in pay for a month is not reasonable. This could very well be rent or payment for childcare. Starting this month (February) the average student would have to save $150-200/month to make up for that shortfall. This could be 1/2 of the groceries for the month. Students with higher stipends will have to make up an even bigger difference and as stated above students with scholarships, even scholarships that are equivalent to the base salary, cannot apply for the cash advance. How are these students supposed to cope with this change? Additionally many students do not even know that this is going to happen because it has not been effectively distributed.
There are over 7000 graduate students on campus. If each of these students is paid $500 less (a very conservative estimate) that is 3.5 million dollars the University has bankrolled. This more than doubles when you consider NASA staff and post-doctoral fellows. Investment of this capital will return a much larger sum of money that will likely be used to fund the many high-level administration jobs that are being increased every year. The bottom of the totem pole has been laid off or forced to take furlough days and now their money will be borrowed and likely never returned to our benefit. Our University has praised graduate students and post-doctoral fellows to be future leaders and an important part of the foundation of our institution. Is this how it is shown?
Graduate Students and Postdoctoral Fellows of the University of Alberta
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All the details of the plan can be found on the web pages below: