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The county’s largest school system has been offering eligible employees a five-year incentive totaling $25,000 to $75,000 to leave their jobs. Rather than normal payouts, this time the district is offering to deposit the money into a health savings account.
Amid the turmoil of the pandemic, San Diego Unified School District officials want veteran senior employees to retire on Dec. 31.
About a month ago, the county’s largest school system began offering eligible employees a five-year incentive totaling $25,000 to $75,000 to leave their jobs. Rather than normal payouts, this time the district is offering to deposit the money into a health savings account, which can be used to pay for health insurance premiums or other eligible health care costs.
Teachers and most other employees qualify if they are at least 55 years old and have 15 years of service at the district. School police must be just 50 and have 15 years of service, according to district documents posted online. The difference in the amount received is dependent on whether the employee is eligible for Medicare. If they are, they get the lesser amount.
An FAQ page on the district’s human resources site says there is no minimum number of employees needed for the retirement incentive to proceed – something typically required, though not always followed.
It is also not clear what district officials expect the new deal to cost when all is said and done, how many are eligible or how many people they plan to replace. A district spokeswoman did not respond to questions.
Achieving savings or at least a cost-neutral deal requires keeping some jobs vacant or hiring less experienced and cheaper workers as replacements. San Diego Unified is not always good at showing the math on its retirement deals, and sometimes savings are not the goal anyway.
Retirement deals in 2017 taken by more than 1,100 employees still cost San Diego Unified nearly $16 million annually, with those payouts continuing through 2021-22, audited financial statements show. But the retirements paved the way for the district to rescind more than 1,200 layoff notices for more junior employees during that year’s budget crisis.
And with the coronavirus having upended all that was normal about public schools, some veteran employees might be eager to leave with a little more financial security. Plus, unlike normal incentives, this one does not get taxed.
“Health care costs are what keep people working even though they are ready to retire sometimes, because health insurance is expensive,” said Donis Coronel, a district retiree and executive director of the union that represents 540 district managers, supervisors and vice principals. “This helps people ready to retire and bridges them to Medicare.”
Coronel said she’s not sure how many of her members will choose to retire and submit paperwork by the Oct. 29 deadline, but “I know there is a lot of interest, particularly with my classified managers and supervisors, more than the principals and vice principals.”
The pandemic and all its impacts are factoring into employee retirement decisions.
“I think it’s pretty universal that securing health care benefits during a global pandemic is important for everyone,” wrote Kisha Borden, president of the 6,500-member teachers’ union, in an email. “One of the most pressing issues for educators considering retirement is how they will afford health care once they are no longer a SDUSD employee.”
So too said Sabrina Hahnlein, spokeswoman for the district’s office-technical and business services employees.
“Health care is a major reason staff sticks around into their later years, and with the potential of those with health issues that are more susceptible to COVID, this gives employees the ability to retire with health care still at the level we currently receive,” Hahnlein wrote in an email.
Coronel, with the administrators union, also said health concerns and the stress of increased technology use at schools are weighing on some as they decide what to do.
“We are all in a whole new world with how we are operating the school district as a business and they may not be as comfortable with the online world,” Coronel said. “And there are a few I’m aware of with underlying medical conditions and don’t want to be in a position to not return to work (in person) at some point. … This gives them the opportunity to make a choice and retire a little earlier than they were going to anyway.”
The retirements could also free up some grandparents to assist with childcare duties, “which will be really helpful,” Coronel said.
While there is “some concern” the incentive could lead to a large amount of turnover midyear, Coronel said the district has already ramped up recruitment efforts and plans to post anticipated job vacancies Nov. 1, so positions may be filled upon the departures at the end of the year.
Coronel hopes the district does not leave too many retiree jobs vacant, because “as we bring kids to school campuses, in some areas, more employees are needed,” like custodial employees, she said.
Before students returned, and even with the small cohort of students back on campus for reopening phase one now, Coronel said her employees have plenty of work to do.
“Their work didn’t stop. It may be done differently, but it didn’t stop,” she said.
Corrections: An earlier version of this post misidentified the union Sabrina Hahnlein represents. She is a spokeswoman for the district’s office-technical and business services employees. An earlier version of this post also misstated the maximum amount of the incentive; it is $75,000.