The University of Minnesota will require new employees to pay larger contributions toward their retirement plans under a proposal approved by the Board of Regents Wednesday.
Currently, faculty put 2.5 percent of their salaries into retirement, while the university pays 13 percent. The new plan would require faculty hired after Jan. 1, 2012, to pay 5.5 percent. The university's contribution would decline to 10 percent. Current faculty won't be affected by the change.
Jackie Singer, director of retirement programs at the U of M, says faculty groups on campus didn't want the employees' contributions to go any higher than 5.5 percent.
"They felt that increasing it at this time might really have an issue with recruiting efforts. Requiring more of a contribution could have some recruiting issues," she said.
The change is expected to save the university $3 million in its first year.
The increase puts the U of M more in line with what other universities contribute to their faculty members' retirement funds, but remains more generous than most private sector employees' retirement plans.