UI Faculty Senate members learned Tuesday that faculty would be subject to the same change in the vesting policy as staff if officials approve the plan.

The proposal, known as cliff vesting, would annul all retirement contributions from the UI to employees who leave the university within three years of their being hired, said Susan Buckley, the UI vice president for Human Resources.

“I was asked to resurrect the idea and take people’s temperature about it,” she said.

Currently, all new UI employees are immediately vested into the institution, meaning they receive a share of retirement benefits regardless of how long they stay.

The change would apply to the roughly 16,000 employees enrolled in the TIAA-CREF retirement plan and could save the university around $1 million a year, though the savings wouldn’t start for three years.

The proposal comes soon after officials announced they would cut the university’s retirement contributions to employees from 10 to 8 percent.

Just as at last week’s Staff Council meeting, Faculty Senate members discussed possible exceptions to the policy.

These can be written into the policy in advance, Buckley said, such as for breaks in service to the UI. That exception would apply to researchers who experience gaps between grants.

Senate members also discussed whether the manner in which someone leaves the UI should matter.

Cliff vesting would apply to employees who are terminated before three years have elapsed, Buckley said.

But engineering Professor Richard Valentine said employees who are laid off because of budget issues shouldn’t be penalized by losing retirement benefits.

Last week, staff members also questioned the effect implementing cliff vesting would have on recruitment, particularly among younger people who may not be planning to remain at the UI.

Iowa State University officials implemented cliff vesting in response to budget cuts leading up to fiscal 2010. At ISU, employees are vested after three years of continuous service.

Tom Schellhardt, vice president for administration and financial services at the University of Northern Iowa, said all employees covered by TIAA-CREF are vested immediately. However, UNI officials are examining the possibility of implementing cliff vesting, which Schellhardt called an “industry standard.”

“This is pretty much the norm for people not in academia,” said Laura Prince, a member of the UI Staff Council, who said she worked in the private sector before coming to the university.

UI officials also looked at a graduated five-year vesting option, where employees earn an increasing percentage of their benefits each year for up to five years. But Buckley said the UI would save less money with this option.

UI officials considered vesting several years ago amid earlier budget cuts, but decided against the practice, she added.

The plan would only apply to new hires; all current employees are exempt. President Sally Mason would make the final decision regarding vesting at the UI, though the state Board of Regents must also approve the change.