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Stanford Report, April 9, 2003

Senate discusses impact of end of mandatory retirement, 10 years later

BY ANDREA M. HAMILTON

The end of mandatory retirement has not resulted in a dramatic increase in the average age of the faculty, officials told the Faculty Senate last week.

Stanford ended mandatory retirement at age 70 in August 1993. In 1987, Congress amended the federal Age Discrimination in Employment Act to make mandatory retirement illegal for the most part, with an exemption granted to universities for tenured faculty until 1994. As the university approaches the 10-year anniversary of the end of mandatory retirement, the senate reviewed the impact of the change.

Looking at data from fiscal year 1993 to the present, Vice Provost for Faculty Development Pat Jones noted the average age of the faculty has shifted upward slightly, from 47.6 just before the end of mandatory retirement to 49.3. "So that's some increase. It's not really a huge increase," she pointed out.

A closer look at the distribution of percentages of faculty (including tenure-line, non-tenure-line and Medical Center Line faculty) in different age brackets also shows a slight upward shift. Prior to the change in 1993, there were no faculty over 70 at Stanford. As of this year, there are 48 faculty 70 or older, or 2.8 percent out of a total 1,713. The business school has the youngest faculty, Jones added, with 80 percent of its faculty under 55.

Well before the legislated change, Stanford had retirement incentive programs (dating back to 1973), Jones told the senate. She noted that programs have evolved over time as successive administrations have examined and changed policies.

The current faculty retirement incentive program (FRIP), modified as of January of this year, was put into place in the spring of 1994. The two-tiered program grants a one-time bonus, based on the final year's base salary, for those with 15 or more years of service: For those 60 through 66, the bonus is two times the final salary; for ages 67 through 69, the bonus is one year's salary. There is also a special one-time enrollment opportunity for faculty currently 70 or older through June 30, 2003, to take advantage of the one times final base salary bonus.

In any given year, Jones said, 1.9 percent of the faculty retire, and some 63 percent of retiring faculty have taken advantage of FRIP. This suggests, she said, that FRIP has played a role in some faculty members' decision to retire, although she acknowledged there are many contributing factors.

John Shoven, economics, presented data to show how the end of mandatory retirement has affected faculties nationwide. He clarified that even when mandatory retirement was still in place, it was not obligatory: Universities were allowed, but not required, to force faculty to retire at age 70. Many institutions, including Stanford, exercised that right, but some did not. The biggest change since 1994, he noted, is that less than 30 percent of those 70 or older retire within a year; prior to the change in policy, some 75 percent had retired by 71. Of those who remained, another 60 percent were retired by age 72.

Stanford's retirement plan is among the more generous, Shoven said, and it is also continuous: The option to take the bonus is ongoing until the age limit is reached, rather than a "window plan" in place at many institutions that offers a bonus only during a limited time period, such as 18 months. Also, unlike other plans, Stanford's FRIP is not an early retirement incentive: Shoven said there is no real incentive to retire until age 67, the first point at which the post-age-59 bonus gets halved to one year's salary.

More than a decade ago, then newly appointed President Gerhard Casper warned that the end of mandatory retirement for university faculty was an ill-advised social policy that in the long run would hurt America's competitiveness. Such fears now seem unfounded, based on Shoven's research. Overall, Shoven noted, "there's been less aging of the faculty [at Stanford] than nationwide. And this is in contrast to what our expectations and certainly what Gerhard's expectations were," he added. "There was concern that we're a research university with relatively light teaching loads; we're a great place to live. People might just stay and stay and stay."

But that doesn't seem to have occurred at Stanford -- at least not yet, he concluded.

Several faculty turned the discussion around to consider the issue from the perspective of emeriti, in particular how the university might make better use of a valuable resource.

"There are several functions in the university that might be usefully served by emeritus faculty if we were to think about it in a creative way [such as advising freshmen]," said Mark Granovetter, sociology. "The other side of this is we're losing a lot when we lose our eminent faculty who retire and we don't think very creatively about how to tap those talents."

Shoven noted that many departments do in fact rehire retired faculty at their old salary, at term appointments instead of under tenure; in the School of Humanities and Sciences, the number of "callbacks" runs more than 50 percent.

Robert Simoni, biological sciences, said departments such as his "owe a great debt" to faculty who joined Stanford in the 1960s and helped move it into the elite rank of institutions. He said benefits such as a small amount of funding for research and office space could make a great difference in making emeriti feel a part of the academic community.

Phyllis Gardner, molecular biology/medicine, said departments like hers were more interested in keeping their researchers young, vibrant and on the cutting edge, whereas older faculty were particularly valued for their teaching and mentoring skills. The challenge, she said, is to devise a retirement incentive program that meets both goals.

But early retirement programs sometimes backfire, Shoven said. Some universities lose their best faculty, who take the incentive package and move elsewhere. "You end up losing just the people you didn't want to lose. You have to be very careful how those plans work," he cautioned.

While the discussion ended without any specific decisions regarding the issue of emeriti, senate Chair Hank Greely noted that the senate would take up the issue again, most likely next fall.