The University of Minnesota regents will examine how the U's top executives are paid and could recommend greater oversight, following the disclosure of compensation packages its new president has called "very generous" and legislators have found "appalling."
The Board of Regents announced Friday that a three-regent committee will review current policies regarding executive compensation and paid leaves, which are meant to help administrators transition back to faculty spots.
Chair Linda Cohen asked the committee to "study the question of whether the policies ... are sufficient and really best practice," she said, "to get high-caliber administrators and yet also be prudent."
Past University President Robert Bruininks has been criticized in recent months for signing a series of compensation agreements that routinely allowed departing executives paid leaves at their administrative salaries, even when administrators did not intend to return to the U. In negotiating the deals, Bruininks often waived a requirement that they repay their stipends if they did not return to the faculty, a Star Tribune report showed.
After that report, legislators called a hearing in March on the pay packages, new U President Eric Kaler pledged to be more stringent and regents promised to take a tougher look at executive compensation.
Regents were surprised to learn about the compensation paid and leaves granted to outgoing administrators, Cohen said. "That's why I think it's our responsibility to make sure that if we were surprised, if it was something we should have known about, we put procedures in place," Cohen said.
During public meetings starting April 26, the new committee will review policies on compensation and leaves, compare them with those at other universities, ask Kaler's administration to propose revisions and consider guidelines for closer oversight. The full board will weigh the group's recommendations at its June meeting and could make changes by the fall.
Bruininks and Carol Carrier, his former human resources vice president, defended the pay packages for departing administrators as the norm in the Big Ten and elsewhere.
Cohen said that she personally believes that the regents ought to look closely at the policy guiding "administrative transitional leaves."
The sabbaticals themselves are important, Cohen said, and give longtime administrators returning to faculty positions time to "get up to speed" in their fields. But she wants "to do it in a way that's very appropriate and prudent" and believes that salaries paid during those leaves "should be at the professorial salary they will return to -- and not the administrative salary they're leaving."
Right now, the policy states that "salary and benefits are typically paid at the level of the assumed, or resumed, faculty or professional position rather than at the administrative salary level." But it allows leeway, and Bruininks generally paid his administrators at the higher salary.
Cohen suggested that when a president wants to grant a leave at an administrative salary, board approval ought to be required.
In an e-mail, Bruininks said that administrative leaves help "attract and retain talented academic leaders in an increasingly competitive environment."
"I'm confident that I deployed [the paid leaves] in the long-term interest of the University," he said, "consistent with both precedent and existing policies."
Kaler assured legislators last month that he plans to closely follow current policies, including guidelines that require an employee who does not return to the university following a sabbatical to repay the salary earned during that time.
Any "substantial deviations from policy" would be reviewed by the U's regents, he said then. "I will be proposing a policy change at the university to accommodate that."
In 2006, a regents work group charged with reviewing presidential compensation made a similar recommendation. It noted that Bruininks agreed to draft a policy outlining principles for setting pay for senior management and present it to the board. Today's regents have noted that, for whatever reason, that process did not move forward.
"There was a general agreement that the President would discuss trends and issues in setting compensation in his annual review process," the report continued, "and provide information on unusual or exceptional compensation issues with the Chair and Vice Chair."
Bruininks said via e-mail that he regularly discussed with the board "any serious compensation and retention issues as those issues arose."
The committee announced Friday will be led by Regent Richard Beeson, president and CEO of Park Midway Bank, and will include regents Dean Johnson and John Frobenius. It's temporary, but depending on its recommendations, the regents could make a version of it permanent.
For months, board members have talked about establishing a compensation committee, Cohen said.
"It appears as though we're responding to media reports, and we certainly are," she said, "but it's something that's been on our minds for some time."
Staff writer Tony Kennedy contributed to this report.
Jenna Ross • 612-673-7168