News

Stanford announces layoffs, workforce reductions to address budget concerns

University president: If campus can't reopen in the fall, more cuts are likely

Stanford University has laid off 208 employees as part of workforce cuts under its recently approved 2020-21 budget plan. Embarcadero Media file photo by Sinead Chang.

Stanford University continues to tighten its budget to address lost revenue due to the pandemic shutdown, including permanently laying off 208 employees, putting 30 additional employees on furlough and eliminating more than 400 vacant positions.

President Marc Tessier-Lavigne announced the cuts in a message to the campus community last week.

Though the university's board of trustees approved a budget plan for 2020-21 that includes a 3% increase in endowment payout to support student financial aid, a 10% decrease in payout from other endowment funds to "mitigate market volatility" and the tapping of $150 million of unrestricted endowment funds to help balance the budget, the workforce cuts were still necessary, he wrote.

"Although cuts to non-financial aid budgets have been less deep than we initially feared, they have still meant that units and departments have needed to make reductions in spending," Tessier-Lavigne wrote. "Because salaries are such a large component of the budgets of all units, unit leaders have had to make difficult choices about their workforces over the next year."

The permanent layoffs include reductions to Stanford's athletic staff, announced in July.

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Employees who have been laid off, either temporarily or permanently, will stay on the payroll for 60 days, he said. Employees who are temporarily laid off may continue medical benefits and people who have permanently lost their jobs will be eligible for career transition services, severance pay and continued medical benefits.

Stanford still plans to bring undergraduates back to campus in the fall with numerous safeguards in place, including mask requirements, regular testing, temperature checks at dining halls and contact tracing in the event of infections. But the resurgence of COVID-19 cases locally and across the state could disrupt that plan — and lead to further layoffs, Tessier-Lavigne said.

"If the pandemic continues to worsen in our region and we are not allowed to bring back students as planned, there could be further significant impacts on our operations and revenue streams. As a result, at this time we cannot exclude the possibility of further layoffs, temporary or permanent, at some future date, although we earnestly hope they will not be necessary," he wrote.

Stanford is encouraging undergraduate students and their families to make back-up plans for fall housing, to purchase refundable tickets for travel and to bring to campus no more than two suitcases and a backpack — "in other words, what a student can reasonably carry," university leaders said.

The university said it will provide another update on plans for the fall quarter in mid-August.

California's colleges and universities are also awaiting specific reopening guidance for higher education institutions from Gov. Gavin Newsom.

Find comprehensive coverage on the Midpeninsula's response to the new coronavirus by Palo Alto Online, the Mountain View Voice and the Almanac here.

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Stanford announces layoffs, workforce reductions to address budget concerns

University president: If campus can't reopen in the fall, more cuts are likely

by / Palo Alto Weekly

Uploaded: Wed, Aug 5, 2020, 9:26 am

Stanford University continues to tighten its budget to address lost revenue due to the pandemic shutdown, including permanently laying off 208 employees, putting 30 additional employees on furlough and eliminating more than 400 vacant positions.

President Marc Tessier-Lavigne announced the cuts in a message to the campus community last week.

Though the university's board of trustees approved a budget plan for 2020-21 that includes a 3% increase in endowment payout to support student financial aid, a 10% decrease in payout from other endowment funds to "mitigate market volatility" and the tapping of $150 million of unrestricted endowment funds to help balance the budget, the workforce cuts were still necessary, he wrote.

"Although cuts to non-financial aid budgets have been less deep than we initially feared, they have still meant that units and departments have needed to make reductions in spending," Tessier-Lavigne wrote. "Because salaries are such a large component of the budgets of all units, unit leaders have had to make difficult choices about their workforces over the next year."

The permanent layoffs include reductions to Stanford's athletic staff, announced in July.

Employees who have been laid off, either temporarily or permanently, will stay on the payroll for 60 days, he said. Employees who are temporarily laid off may continue medical benefits and people who have permanently lost their jobs will be eligible for career transition services, severance pay and continued medical benefits.

Stanford still plans to bring undergraduates back to campus in the fall with numerous safeguards in place, including mask requirements, regular testing, temperature checks at dining halls and contact tracing in the event of infections. But the resurgence of COVID-19 cases locally and across the state could disrupt that plan — and lead to further layoffs, Tessier-Lavigne said.

"If the pandemic continues to worsen in our region and we are not allowed to bring back students as planned, there could be further significant impacts on our operations and revenue streams. As a result, at this time we cannot exclude the possibility of further layoffs, temporary or permanent, at some future date, although we earnestly hope they will not be necessary," he wrote.

Stanford is encouraging undergraduate students and their families to make back-up plans for fall housing, to purchase refundable tickets for travel and to bring to campus no more than two suitcases and a backpack — "in other words, what a student can reasonably carry," university leaders said.

The university said it will provide another update on plans for the fall quarter in mid-August.

California's colleges and universities are also awaiting specific reopening guidance for higher education institutions from Gov. Gavin Newsom.

Find comprehensive coverage on the Midpeninsula's response to the new coronavirus by Palo Alto Online, the Mountain View Voice and the Almanac here.

Comments

Mark Weiss
Downtown North

Registered user
on Aug 5, 2020 at 10:53 am
Name hidden, Downtown North

Registered user
on Aug 5, 2020 at 10:53 am

Due to violations of our Terms of Use, comments from this poster are only visible to registered users who are logged in. Use the links at the top of the page to Register or Login.


Alum
Registered user
Portola Valley
on Aug 5, 2020 at 1:50 pm
Alum, Portola Valley
Registered user
on Aug 5, 2020 at 1:50 pm
16 people like this

With a $27 billion endowment, the obvious question is why doesn't the Stanford board of trustees decide to simply absorb the expected losses as a "once in a lifetime" event?
Those who are among the unfortunate individuals being terminated cannot help but look at the size of the endowment and wonder what message this round of layoffs sends about Stanford's priorities.


chris
Registered user
University South
on Aug 5, 2020 at 2:32 pm
chris, University South
Registered user
on Aug 5, 2020 at 2:32 pm
9 people like this

The university is substantially increasing the payout from the endowment next year. However, most of the endowment is restricted in its use and cannot be used to support deficits. The university would have to borrow the money and may have to anyway. The downturn will not be short so expenses will have to be reduced sooner or later.


Online Name
Registered user
Embarcadero Oaks/Leland
on Aug 5, 2020 at 2:42 pm
Online Name, Embarcadero Oaks/Leland
Registered user
on Aug 5, 2020 at 2:42 pm
7 people like this

Doesn't the university have lawyers and mechanisms to revise how the endowment is administered in extraordinary circumstances?


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