FY23 Budget Update - June 6, 2022: Compensation and Retirement Contributions

June 6, 2022

Dear Faculty and Staff,

I hope all is well with you as we head into a busy commencement week. In advance of tomorrow’s CFO Forum (1-2:30 p.m., Pigott Auditorium), I am writing to update you on Seattle University’s preliminary budget for the 2023 fiscal year, which our Board of Trustees approved last week. (The FY23 budget covers July 1, 2022 to June 30, 2023.) While we previously shared information with students and their families on tuition, fees and financial aid for the coming academic year, I wanted to update you on compensation for FY23 and retirement plan contributions for the 2023 calendar year.

Compensation Increases

The largest and most important investment we make as a university is in our faculty and staff. With inflation persisting and the cost of living in the greater Seattle area rising, our continued focus on supporting increases in compensation took on added significance this year.   
Our investment in compensation consists of two components: a wage pool increase and a restoration of retirement benefits. 

Wage Pool Increase

On the wage pool side, the increase averages out to 3.75 percent, which is above the average U.S. benchmark of 3.3 percent. This is the largest increase at Seattle University in nearly 15 years. It consists of two broad components:

  • A 3 percent wage pool increase for performance-based merit pay increases for faculty and staff.
  • An additional investment of 0.75 percent that funds promotions and special market pay adjustments for a subset of faculty and staff positions whose pay most significantly trails the market, recognizing the gap relative to market median salaries is wider for faculty.

University Contribution to Retirement Benefit

For calendar year 2023 (beginning on January 1, 2023), the university will be making two changes to the retirement benefit for faculty and staff:

  • For current faculty and staff (those employed by Seattle University on or before June 30, 2022), the university will restore its prior retirement contributions of 10 percent of base salaries. This brings the benefit back to the level we had before the pandemic necessitated a pause and then a partial restoration. Current faculty and staff may choose to contribute their own savings to the plan but will not be required to do so.
  • For faculty and staff joining Seattle University after June 30, 2022, the university will introduce a new approach starting in 2023 in which it automatically contributes 5 percent of pay toward eligible employees’ Fidelity accounts. Up to an additional 5 percent will be provided as matching contributions to the new employee’s voluntary savings in the Fidelity account. More details about the retirement plan will come later from Human Resources.

I know that our CFO Wilson Garone and Interim VP of HR Matt Philip will share more specifics on FY23, as well as our long-term financial plan at tomorrow’s forum. For those unable to attend, a video will be posted and shared in the coming days. Thank you for your continued work on behalf of Seattle University.

Eduardo M. Peñalver