Amherst College 2021 Voluntary Retirement Option FAQs

1. What is the purpose of the Voluntary Retirement Option (VRO)?

The goal of this program is to give eligible employees flexibility in planning their retirement while supporting the operational needs of the College. The VRO is designed to give these employees an incentive to consider retirement this year.

2. Who is eligible?

To be eligible for the VRO an individual must:

• Be a regular full-time or part-time non-faculty employee (casual, grant-funded, lecturer and coach positions are not eligible for the VRO), scheduled to work at the College at least 20 hours per week and at least 39 weeks per year.
• Be an active employee, or an employee on approved paid or unpaid leave of absence as of March 22, 2021
• Be at least 62 years of age by December 31, 2021.
• Have at least 15 years of continuous regular service with the College by December 31, 2021
• Remain employed by the College through the retirement date.  
• The retirement date will be determined based upon the operational needs of the College and the employee and will follow a phased approach to allow for a smooth transition.
• Once you meet the eligibility criteria, the retirement effective date will be no earlier than May 01, 2021 and no later than December 31, 2021.

3. What benefits are included in the VRO?

The benefits will include:

• The payments and benefits provided to eligible employees under the VRO will be as follows:
  • The incentive payment will total 100% of the employee’s regular annual wages up to $75,000, plus 50% of any regular annual wages above $75,000
•  The lump-sum payment will be paid to the employee within 14 calendar days following their retirement date.  This payment is subject to applicable taxes and tax withholdings.  The College will not make any contribution to the employee’s retirement plan based on this payment.
• Group life insurance coverage will end as of the VRO retirement date.  The employee may convert his or her life insurance policy at their own expense.
• The continuation or termination of all other benefits will be governed by the terms of the respective plan.

4. What happens to my health insurance if I receive VRO benefits?

Your age, the age of your dependent(s), and your date of hire, will determine how your coverage continues.

• Staff hired prior to July 1, 2003 are grandfathered under certain features of the post-retirement health coverage.  If you are under age 65 your coverage will continue to be provided in one of the College’s active health insurance plans at no cost to you.  This coverage will end if you are covered by another employer’s health insurance plan.  Effective the first of the month in which you reach age 65, coverage will be provided by two plans: Medicare (Parts A & B) and a Medicare supplement, currently Medex 3 provided through Blue Cross and Blue Shield of Massachusetts. Medex 3 will be provided at no cost to you.
• Coverage for your dependents, if any, will be available at full cost, in an age appropriate health plan.
• If you are age 65 or older on your retirement date, coverage will be provided by two plans: Medicare (Parts A & B) and a Medicare supplement, currently Medex 3 provided through Blue Cross and Blue Shield of Massachusetts. Medex 3 will be provided at no cost to you.

• Staff hired after June 30, 2003 are eligible for the Retiree Health Program. Through this defined contribution plan, starting at age 40 the College sets aside a percentage of the current Medicare supplement for each eligible staff member.  Vesting of a participants account occurs with retirement from the College at age 62 or older and 10 years of service.  At retirement funds are contributed to a health reimbursement account (HRA) from which a retiree may receive a reimbursement for certain eligible expenses. Depending on age, retirees and dependents may remain covered under one of the College’s active health insurance plans, or a Medicare supplement (currently Medex 3 under Blue Cross/Blue Shield), but are responsible for paying the full cost of the coverage.

5. Are the VRO benefits taxable to me?

The lump-sum payment under the VRO is taxable and will be reduced by the applicable income and employment tax withholding.  (The College will not make any contribution to the employee’s retirement plan based on this payment.)  College paid medical and dental benefits (if any) for you and your eligible dependents are not currently considered taxable income.

6. What is the timing of the offer?

The VRO application forms must be received in the Office of Human Resources by 5:00 p.m. on April 12, 2021.  You will not have another opportunity to apply after the application deadline.

7. I’m not sure if I am interested in the VRO. If I apply will I be allowed to withdraw my application after it has been submitted?

Yes. You may withdraw your application at any time during the application period.  Remember too that you do not have to accept the package even if it is offered to you.

8. Why might I want to apply for the VRO?

Applying for the VRO is a personal decision.  You might apply because you are ready to begin retirement, start your own business, spend more time with your family, continue your education, relocate – there are many reasons why employees may be interested in this program.  Applying by the deadline keeps your options open.

9. If I apply, where will my application go?

Your application will go (email) directly to the Office of Human Resources Department.  Human Resources will prepare a VRO letter agreement that includes the specifics of your offer (amount of lump sum, period of College-paid insurance, etc.)  You will then have 45 days to consider the offer.

10. When will my manager know that I have been offered the Voluntary Retirement Program?

Human Resources will notify each manager of the employees in his/her area who qualify for the VRO.  The decision about whether or not to accept the VRO is yours alone – your manager will not attempt to influence your decision one way or another.

11. If my application is approved, when do I have to decide? What if I change my mind?

Once your application is received (email), you will be sent a VRO letter agreement. You have 45 calendar days from the date you receive the letter agreement to accept or decline the offer.  After you execute and return the agreement, you may revoke it within seven days.  If you do not revoke the agreement within seven days, the agreement to retire is binding and irrevocable.

12. If I accept the offer, when will my active employment end, and when will retirement be effective?

Your date of retirement will need to be reviewed and approved by your manager.  Your retirement effective date will be no earlier than May 1, 2021 and no later than December 31, 2021.  Also, the College reserves the right to extend your retirement date to as late as December 31, 2021. Again, this extension will be determined by your manager in consultation with Human Resources.

13. If I apply for the VRO and then leave the College before the VRO retirement date established by my department, will I still be entitled to the VRO?

No. If you leave the College for any reason (except disability) or your employment is terminated according to College policies before the agreed upon date, you will not be entitled to the benefits under the VRO.

14. If I do accept the VRO, can I be reemployed by the College at a later date?

The VRO is designed for eligible employees who are willing to completely end their employment relationship with the College.  This means that all jobs, including on-call jobs, must end as of the VRO retirement date and that generally employees will not be eligible for rehire.  Exceptions to this rule must be approved, in writing, by the Director of Human Resources, following consultation with the applicable department manager and the College’s Senior Staff, and will be based on the needs of the College.

15. If my application is approved, are there resources available to help me decide?

Yes. You can request an individual meeting with a member of the Human Resources Office who can assist you in understanding the program and the benefits available under this program.  You are strongly encouraged to make an appointment with an Individual Client Services Rep from TIAA to discuss options for your retirement plan assets.  TIAA will also be reaching out to each employee who is eligible for the VRO at the beginning of April to schedule a meeting.  If you are eligible for Social Security benefits and wish to begin collecting payments you should contact the Social Security Office directly to begin the application process.  This can be done online at: www.socialsecurity.gov.

16. Can the Employee Assistance Program (EAP) help me during this process?

Yes. Our EAP can provide assistance to you during this process.  New Directions can offer information and provide support around the emotional, legal, and financial implications of retiring.  These services are provided to you free-of-charge.

17. I have a dependent child in college and receive the Grant-In-Aid benefit. Will I still be eligible if I take the VRO?

Yes.  The Grant-In-Aid policy provides for a dependent to continue to receive the grant if the eligible dependent is enrolled at a qualifying institution and meets all other conditions stipulated on your retirement date.

18. Will I be eligible for unemployment benefits?

Eligibility for unemployment benefits is determined by the Department of Unemployment Insurance.  Information about state unemployment benefits can be found at the Mass.gov website.

19. You mentioned a number of resources available to me as I consider this offer. How can I get in touch with these people?

Human Resources
HR@amherst.edu / 413-542-2372

Other Resources:

Employee Assistance Program
New Directions (Company Code: Amherst College) / 1-800-624-5544

TIAA
Customer Service: 1-800-842-2252
TIAA Website

Social Security Administration
413-536-3649
Social Security Website