REA contract’s severance pay and insurance

This is the last in a series of posts directly concerning the Rockford Education Association contract, Article 33 – Early Retirement and Severance Pay.

With a minimum of 10 years service in the district, and upon retirement or severance from the District, the teacher shall receive a lump sum based on last daily rate of pay, times 20%, times the number of accumulated unused sick days in excess of 105.

Taking the highest salary in Appendix B of the REA contract for 2009/2010 of $76,670 for 185 days compensation equals an average daily rate of approximately $415 * 20% = $83 for the purpose of the lump sum calculation.

In Article 25, Allowance for Staff Absence – teachers are allowed 12 sick days each year for the first 20 years of service, and thereafter, 15 sick days each year. If a teacher is employed by the district for 30 years, the maximum lump sum would be calculated as 12 days times 20 years, plus 15 days times 10 years = 390 days – 105 days = 285 days max.

The maximum severance pay, although it’s highly unlikely that anyone would not be sick in 30 years, especially with some of the students that the teacher’s have to deal with, would be 285 times $83 = $23,655.

A teacher with a minimum of 10 year’s service and within 10 years of their 65th birthday may apply for early retirement providing they are eligible under the Illinois Teacher Retirement Act.

The Board will pay for an extension of their present life insurance program through the year in which the individual becomes 65 years of age. Further, staff members retiring on July 1, 2007 and thereafter, and their eligible dependents may enroll in a medical insurance plan provided by the Illinois Teachers Retirement System (TRIP HMO) and the Board will pay the full premium each year until the end of the school year in which the retiree turns 65.

Therefore, district taxpayers pick up the entire cost for up to 10 years of life insurance and the full premium for staff and dependent health insurance coverage for the TRIP HMO. The school board needs to investigate the number of staff taking advantage of these early retirement benefits and the costs of these plans.

There are premium costs for the teacher and dependents in a TCHP plan of up to one-half the premium costs in a calculated formula. If a retiree is the spouse of an active employee, the active employee has the right to cover the retiree as a dependent under any of the Board’s plans.

The contract is under negotiation at the present time and more bargaining sessions have been scheduled. The Board of Education is the taxpayer’s representatives in these talks. The size of the past school year deficit will be determined in an audit that will be finalized later this year.

The size of the deficit for 2012 is yet to be determined, but has been projected by the district to be $9.1M, although state aid and state grants for the district fluctuates every time the governor discusses educational funding.

There are many variables in the Association contract and the board must familiarize themselves with all of those that affect the bottom line. There are reserves available and there is no minimum balance required by board policy, but future borrowing to maintain district operations should not be an option.



  1. Sleeker

    12 days sick leave is more than I get for vacation each year. Teachers in this town are spoiled rotten. It’s time to take back some of these extreme benefits and reduce the burden on the taxpayers.

  2. Denny Wallace

    Even though the Teachers actual work year is at best 172 days per year compared to the 250 days for everyone else… Teachers will be sick and shouldn’t suffer the lost earnings as a result.

    However, considering all the other perks doles out (the recent 20% lump sum retirement bonus avg $12-$16,000 each that was recently ended) demonstrates there is no forbidden fruit when it comes to the gall of the Teacher Union to ask for.

    For instance the Early-Retirement 75% of earnings boondoggle paid to All Teachers regardless if they earned it (or not) come age 54-55 years old is something most Teachers (and all Union Radical’s) totally ignore when it comes to Teachers earnings.

    I have estimated the entire 9% Teacher pension Contributions + 7% compounded earnings are exhausted by the time they reach age 66-67 years old… In today’s dollars that is easily $500,000 to $750,000 “winning lottery ticket” sized payday… or well over $20,000 per year of early retirement benefits handed over to each Teacher that doesn’t show up on today’s paycheck stub.

    Yet as for me…. Forget pursuing a pound of flesh demanding $5-$6,000 Teacher Paycut and simply reprioritize how we spend the $270+ million on school district wages and benefits (Teachers + other employees).

    The many Superstar Teachers deserve to paid much, much more then their peers who are in Teaching Jobs that make it hard to come up with even 4-5 hours of real work each day. ALL OF WHICH CAN BE PAID FOR WITH EXISTING MONEY BY JUST PAYING ALL SCHOOL EMPLOYEES A FAIR DAYS WAGE FOR A FAIR DAYS WORK.

    Just because we have overpaid for a Teaching Assignment isn’t justifcation to keep doing so….

  3. This contract, taken in its entirety, is similar to most others in the Midwest. Let’s say these provisions are taken out of the contract. Who’s going to work for the District?

  4. Ted Biondo

    LuLu – welcome to the blog. I have posted at least 7 or 8 in the series on this contract. I must respectfully disagree. Most of the districts in the midwest, including Illinois, have the teachers pay their own TRS out of their pay, plus TRS insurance premium – that amounts to 10% of pay. RSD, the taxpayers pay for all of it.

    Also, where can you get a health insurance policy of over $16,000 per year for 0 to $89 per month for your entire family coverage. The grievance procedure is second to none.

    This contract has many provisions that are not standard around the midwest – sorry!

  5. Denny Wallace

    So Lulu…. Because everyone does something a certain way then your logic suggests there must not ever be a better way?

    If over the course of History manking followed your “apparent view of the world “same-ole-same is good enough”…. I think we would be all still iving in caves and eating raw meat next to the Fire (if we had em)

    So “Similar” = the best we can come up with?

    “Who’s going to work for the District?” = I hope the best and the brightest who are continually challenged to improve their performance and success in the Classroom. Those many Teaching Super Heroes who are never perfect but definitely GAME CHANGERS when it comes to impacting our children’s lives…

    Sorry but if I was only interested in SIMILAR… I would go live in some Communist Country.

    But sadly…. All to often Communist\Third World countries are kicking the butts of American Public Schools… Probably because of the in-bred attitude is “good enough” for Public Schools… IT’S NOT!

  6. Ted, sorry to change the subject, but here is some good news, from north of the Cheddar Curtain:

    Government And Politics
    Some union members pleased with Walker’s changes

    Susan Flood says she will gladly subtract $4,000 in pension and health premiums from her take-home pay next year in exchange for not having to pay roughly $800 in union dues.

    Few of her fellow teachers at Brookwood Elementary School in the Genoa City District share her view of Wisconsin’s new public sector labor law, which soon will affect the paychecks of thousands of public employees, Flood said.

    But she is a Republican who has been required for 19 years to pay dues to a union she views as promoting mediocrity and high taxes. So when the law stripped public employees of most union rights this year, she celebrated.

    “They say the union is there to stand up for you,” Flood said. “Well, no one has ever had to stand up for me. I think I stand up for myself by doing my job.”

    Read more: http://host.madison.com/wsj/news/local/govt-and-politics/article_534e2992-ab01-11e0-8af1-001cc4c002e0.html#ixzz1S2qFEpTa

  7. Denny Wallace

    SNuss First Off no one can be required to pay Union Dues… There is plenty of Court Rulings, to include the Supreme Court confirmation… That only the costs of Negotiating the Labor Agreement and probably too Direct Union day-to-day administration costs of of said Labor Agreement.

    I agree that it’s good news that Teachers are talking about demanding a refund but my guess is the example you sited, such Teacher can probaly already withdraw membership from the Union and demand a refund of $600+… Not a darn thing the Union could do about it + they could be held liable for damages if they tried to harass her.

    Apply your $800 Union dues just to the Rockford Public School District Teachers who = about 2,500.

    2,500 x $800 = 2,000,000 million dollars

    Just what in the heck is this money being spent on you may ask?

    PAY TO PLAY POLITICS where the Teacher Union buys influence (and access) to the State and Federal Politicians. If you were a new State Rep where $10,000 political contribution meant the difference between paying for re-election out of your own pocket… Would you risk pissing of the Teachers Union… May you be Republican or Democrat?

    So SNuss you got to focus on the Bigger Picture…. Reigning in the Political Clout of the Teachers Union…

    Why on earth would this Teacher be so naive and uninformed (and dumb) to pay as much $12,000 in Union Dues she should have easily known she didn’t have too? Yet sadly, so many peole just don’t understand this legal right.

  8. Denny Wallace

    fyi… Update to my rants…

    Great News from School District CFO Cedric Lewis that Budget Deficit forecasts are now down to $1.3 million vs. the $51 Million we initially forecasted.

    Now just like the NFL, surely the School District and teachers Union have way too much to lose to “delay the start of training camps and opening day of the School Year.”

    Armageddon can be avoided and calmer heads can now prevail rather than rationalizing punishing teacher pay cuts to come up with the $11 million Teacher contract savings originally wrote into the Budget plan.

    The teacher contract negotiations never needed to be about concessions solely focused on cutting wages or Teachers paying more for benefits and pensions?

    We must take off the blinders and look bigger picture? Eliminating abusive Teacher contract language would save much more than any concessions on wages, benefits or pensions. Demanding the Teachers and their Union to become part of the solution and not part of the problem is the direction we must head.

    Imagine a serious re-prioritizing of how we spend scarce tax revenue where the Teachers Contract supported school spending towards the highest priority needs of the kids… Not just pursuing the best deal for the adults.….

  9. “First Off no one can be required to pay Union Dues…”

    Sorry, that isn’t true. In a union setting, you MUST pay fees to the union, whether you want to, or not, under the “fair share” law.

    See: http://www2.illinois.gov/elrb/pages/faq.aspx

  10. Denny Wallace

    If you are going to take the time to post the link whay not add the real detail…

    Sorry to be an ass but did you even read what I said”

    My specific words were: “…That only the costs of Negotiating the Labor Agreement and probably too Direct Union day-to-day administration costs of of said Labor Agreement….”

    Compare that to what you referenced in your link referring to “fair share fees” which do not = Union Dues.

    Court Rulings have narrowed considerably what “fair share fees” can be charged non-union Members.

    Alas I believe I’m correct both by the defnition of Union Union Dues and my interpreation of what Fair Share Fees really come out to be.

    Q: What is fair share?

    A: A collective bargaining agreement entered into with an exclusive representative may include a provision requiring employees covered by the agreement who are not members of the organization to pay a fair share fee to the organization for services. The exclusive representative shall certify the amount of the fair share fee, which shall not exceed the amount of regular dues. The fair share amount shall be deducted from the non-member employee’s earnings and paid to the exclusive representative. The fair share fee shall not include any fees for contributions to candidates for public office.

  11. Denny Wallace


    Teacher says she quit paying union dues on principle
    Sun., January 9, 2011


    GRAND RAPIDS — Nearly 100 teachers stopped paying union dues to the Grand Rapids Education Association once automatic payroll deductions were no longer in place, and the union has taken four of them to court over the matter, according to The Grand Rapids Press. One teacher said she didn’t pay dues on principle, The Press reported.

    See also http://www.mackinac.org/235
    Compulsory Union Dues in Michigan

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