Reappointment Letters Contain Soft-Funding Lay-Off Clause

By Monica M. Walk

SOME UNIVERSITY employees receiving letters of reappointment may be surprised to read unfamiliar phrasing that indicates termination may come at any time due to soft funding issues. While this may be the first time an employee is reading this phrasing in his or her own reappointment letter, the language is not new.

ASSISTANT VICE President for Human Resources Robert Crouch supplied the following information about the “Soft Money Truncation Language” which became effective Aug. 16, 2009:

THE NOTIFICATION of Appointment was modified to include the following language: 

FOR APPOINTMENTS made "subject to receipt of funds" (such as those from grants or contracts), the University reserves the right to terminate the appointment prior to the Period of Service End Date if the grant(s) or other source of funding for the position has ended. An asterisk (*) symbol following the "Dollars" indicates that employment and payment is contingent upon receipt of funds. For such appointments, the University reserves the right to terminate the appointment prior to the Period of Service End Date if the grant or source of funds for the position becomes unavailable, and will provide prior notice, if applicable, in accordance with the notice periods set forth in Article IX(11)(b)(2) of the University of Illinois Statutes. If an asterisk (*) symbol does not appear next to the Dollars box on this Notice of Appointment, your appointment is not subject to the receipt of funds and not subject to earlier termination based on the loss of such funding.

SITUATIONS IN which it is likely appropriate to truncate a contract(s):

• A sponsored agreement budget is reduced during the period of an award
• A proposal budget is renegotiated after the start date of an award and staff have been hired on anticipation funds
• A unit is told a grant will be awarded but the award does not come through
• A unit is told a grant will be awarded but the award amount is lower than the application amount and the unit has hired based on pre-contract information.

“IT’S NOT what an employee expects to see in an appointment letter,” Crouch acknowledged of the language change made prior to his arrival on campus.  “This date is within the timeframe when funding became more volatile.  The language was created in 2009 to allow the University to furlough or lay off people if money is not available—that is, the promise of a grant that is not fulfilled, or granting funding is reduced or eliminated.  It was initiated to give the University some flexibility.”