A temporary, short-term layoff (furlough) or reduction in hours may be implemented by units when necessary to meet temporary budget or operational needs without eliminating positions.
Staff members on furlough are still U-M employees and may return to their position on a pre-arranged date.
Employees may be temporarily reassigned to other available work rather than placed on furlough/effort reduction. An employee designated for furlough/effort reduction who is offered redeployment may request to take the furlough/effort reduction (with no expectation of unemployment compensation benefits) rather than a redeployment.
If a unit decides to implement unpaid short-term layoffs or reduced hours, it may first seek volunteers before moving to the seniority-based process specified in the Standard Practice Guide.
The SPG gives a written description of the short-term layoff (furlough)/short-term effort reduction (SPG 201.73).
| Short-Term Layoff | Short-Term Effort Reduction | |
|---|---|---|
| Duration | Initial period of up to four months; maximum of six months with extensions | Initial period of up to four months; maximum of six months with extensions |
| University Pay | No | Yes at percentage of effort |
| Unemployment Eligibility | Yes (read more about eligibility on this page) | Yes (read more about eligibility on this page) |
| Maintain Health Insurance and Other University Benefits | Yes (read more about eligibility on this page) | Yes. Employee pays the same premium rate before reducing hours (read more about benefits on this page) |
| University Contributions to Retirement Savings Plan | No | Yes at percentage of reduced salary |
| Employee Contributions to Retirement Savings Plan | No | Yes at percentage of reduced salary |
| Service Credit Toward Retirement | Yes if returned to an active appointment | Yes unless appointment is less than 50% for more than 1 year (if an employee works at least 80% for one day, full service credit for the year is received) |
| Retains Vacation/PTO/Sick | Yes but it will not be available for use | Yes |
| Accrue Vacation/PTO/Sick | No | Yes at reduced effort |
Eligible Employees
The policy applies to regular staff, research scientists, research professors, librarians, curators and archivists. Staff covered by the terms of a collective bargaining agreement should refer to their labor agreement for information on layoffs.
Redeployment
Employees may be temporarily redeployed to other available work.
Unemployment
A claim for state unemployment compensation will not be contested by the university unless the employee was offered and declined redeployment to another position. Eligibility for and amount of unemployment benefits are determined by the state of Michigan.
Unemployment Insurance Benefits Resources
Benefits
The university will continue to make contributions toward insurance coverage during the period of a short-term layoff (furlough)/effort reduction similar to active employees.
Life, long-term disability, health, dental, vision, and legal coverage will continue during the period of short-term layoff (furlough) or effort reduction, provided there is continued payment/payroll deductions of the required employee premiums as prescribed by the university. For employees covered by federal awards, visit the Office of Research and Sponsored Projects website for more information.
Employees are responsible for their annual FSA election amounts.
If coverage has been discontinued for the period of furlough, coverage will be reinstated when the employee returns to a benefit eligible position.
All retirement savings contributions are discontinued while on short-term layoff (furlough). Contributions for those on reduced hour appointments will continue at percentages of reduced salary.
Returning to Work
The employee will be returned to the work schedule/regular appointment hours at the end of the furlough period, unless business circumstances change to such an extent to indicate a Reduction-in-Force is warranted.
Employees may be recalled early if circumstances change that enable a return to work.
Paid Time Off
An employee placed on a short-term layoff (furlough) will retain unused sick time, vacation, or PTO. There is no access to paid time off during the period of furlough. The employee will not accrue additional paid time off during this time.
An employee placed on a short-term reduction in hours and who is otherwise eligible for sick-time, vacation, or PTO benefits may request use of the time and other paid time off in proportion to the appointment fraction.
Balances are prorated based on appointment effort at the time of usage and hours above the maximum will be "stored" and restored to the employee upon return to their original appointment effort. Accruals will be at the pro-rated appointment effort.