Deferred Pay as a Payroll Option for Academic Year Faculty

Faculty can elect deferred pay as an option to be paid with their Fiscal Year 26 Salary agreement. You will make that election in May 2025. The payroll schedule will begin with your AY 26 contract. Pay will be deferred summer 2026.

• Full-time faculty on Academic Year contracts can opt in to deferred pay beginning Spring 2025 when they sign their salary agreement. Pay will be deferred for the 2025-26 AY contracts. Each year, when you sign your salary agreement, you will select your preference for pay (standard or deferred).
• Your appointment must start the Academic Year on deferred pay; faculty who begin mid-year must wait to select deferred pay until the following year.
• Faculty must have a 1.0 FTE appointment for the entire academic year.

No, deferred pay will be one of two options for payroll offered to faculty on AY contracts. When you sign your salary agreement, you will select the way in which you want to be paid for the upcoming academic year. You can select standard pay (9 months) or deferred pay (12 months).

Yes, and they will have to manage a one-time disruption in four pay periods in late summer 2025 to accommodate a payroll schedule transition.

No. Faculty are only eligible to be on deferred pay if they have a 1.0 FTE appointment for an entire academic year.

U of I uses a bi-weekly payroll schedule. The new deferred pay system requires a reset in the payroll schedule from 19.5 pay factors to 20 pay factors. The contract period and job duties remain the same, but the Banner system requires an even number of weeks in the pay schedule (and not split pay periods). In other words, the academic year will remain on the 39-week work schedule, but the payroll will be paid out over 40 weeks. The summer schedule will remain the same.

Faculty who hold administrative appointments (e.g. associate dean, department chair, program director, etc.) and who receive an administrative stipend can opt into having their base salary paid as deferred pay, but the administrative stipend must be paid over the academic year (nine months).

These positions often experience a great deal of change or start at different points in the year. The new payroll system has difficulty accommodating the high turnover and variability with these types of positions and so this part of the appointment will be treated separately and can only be paid on the academic year schedule.

Your academic year contract will begin on August 18, 2025 and there is a two-week lag between the time you work and your first paycheck. Your first paycheck for AY 26 will be on Friday, September 12, 2025.

You will receive the same salary outlined in your FY 25 salary contract and you will continue to be paid according to the payroll schedule you were on at the start of the academic year. The amount in your paychecks may be different if you changed your benefits elections.

That is correct. Your base academic year salary will be divided over 20 pay periods (standard pay) rather than 26 pay periods (deferred pay).

No. You received that incentive to stop using the old deferred pay system.

No, you will still be paid the same amount for your work according to your contract.

The $1000 incentive stipend was only a one-time offer for faculty who moved off deferred pay in 2017.

This information is forthcoming and a solution will be in place by the time the salary agreements are ready to sign in May 2025. You will make your payroll selection at the time you sign your salary agreement.

Faculty senate passed a resolution in December 2023 to bring back deferred pay for all academic year faculty. In order to do so, it is no longer possible to support two different payroll schedules for academic year faculty. The old system must end for a variety of reasons. The old system of deferred pay relies on paying faculty before their contract starts, which creates significant challenges.

The updated process will allow the administrative systems (Banner) to manage these deferred pay schedules in the manner intended and reduce the administrative burden associated with managing those pay schedules and lessens the likelihood of error.

Likewise, the new system allows for contracts for standard pay and deferred pay to operate with the same payroll schedule. U of I can only have one payroll system for academic year faculty.

Scroll to the top of the page and click the yellow and black button “Open Forum for Legacy Deferred Pay Employees".

• Faculty senate voted to bring back deferred pay in December 2023. In order to make deferred pay available to all academic year faculty, the payroll schedules must be the same.
• This change was communicated to faculty on the old system beginning in December 2023 when Faculty Senate passed their resolution. Faculty in this group were told that the old system required a schedule shift to align with the academic year and that they needed to prepare for a schedule transition that involved a gap in paychecks for a period of time.
• U of I will pay all faculty the full amount of their contracted salary for AY 25 and AY 26. Faculty cannot be paid in advance per Idaho statute.

Faculty members who were on the deferred pay system prior to 2017 are currently on the old deferred pay system. To offer deferred pay to all academic year faculty, the payroll and work periods need to be aligned.

Salary for the 2025-26 contract will remain unchanged; however, faculty will not receive four paychecks in late Summer 2025 as they would under the old deferred pay system. They will receive the July 3, 2025, paycheck plus a $1400 stipend to offset the cost of their employee contributions to benefits, then they will have an eight-week gap until pay begins for Fall 2025 under the new pay schedule. They will not receive a paycheck for the following dates:

• July 18, 2025
• Aug. 1, 2025
• Aug. 15, 2025
• Aug. 29, 2025

Paychecks will resume on Sept. 12, 2025. This will be the first paycheck of the 2025-26 appointment.

If you are an employee on the old deferred pay system, contributions to your benefits need to continue during the schedule transition. U of I will continue to make the employer contributions to your benefits during this time and employees will need to make their employee contributions to their benefits during this time.

To offset this cost during the schedule transition, U of I will provide $1400 to each faculty member on the old system to help offset the expenses of their employee contributions during this time. This will be included in the July 3, 2025 paycheck.

Summer contracts are separate from your academic year contract. Summer contracts are paid according to the regular payroll calendar over the summer. You can work during the summer and be paid during the summer. The payroll schedule transition affects the faculty academic year base salary.

Your retirement contributions are made when you are paid. You will receive your full salary for AY 25 and AY 26. Retirement contributions remain the same at the time you are paid.

Unfortunately, this is not possible. Advanced payment to employees is not allowed by Idaho statute. Likewise, employees are compensated for the work they are contracted to do.

No money is withheld from you. There is a payroll schedule transition of eight weeks. You will receive all of your salary for AY 25 and AY 26.

You do have to manage a one-time, eight week payroll schedule readjustment. This schedule readjustment is necessary to bring the payroll schedule into compliance with Idaho statutes and to make deferred pay available to all academic year faculty. There are many ways that employees can manage that gap.

For the transition year, you won’t be put on the 20 pay schedule until January of 2026. There is a delay in that so you don’t overpay your benefits. Benefits are paid on a calendar year so we will make sure to manage this transition for employees who make this change in their payroll schedule.

It’s correct that for the summer deferred pay transition, you will be making your employee contributions toward benefits after tax. The $1400 stipend takes that into account to help offset these expenses.

Unfortunately, U of I cannot loan money to employees.

There are no salary savings for any of the deferred pay implementation. The State of Idaho allocates salaries when they are paid. U of I will not hold any of the funds during the payroll schedule transition.

U of I is investing significant resources to bring back deferred pay to make it available to all U of I academic year faculty per Faculty Senate’s request. This effort has no salary savings for the university.

Payments for benefits must continue during the payroll schedule transition. U of I will continue to make its employer contributions to benefits, and, during this time, U of I’s third-party benefits administrator will bill faculty on the old system directly for each of the four pay periods for the cost of their benefits.

To ensure that employees can continue to make their employee contributions toward their benefits, each person on the old deferred pay system will receive a $1400 stipend on July 3, 2025 — as part of their paycheck. The $1400 stipend will lessen the impact of the employee contributions toward benefits. The benefits coverage during this period will not be affected as long as the payments are made during the transition period.

This stipend is taxable. The supplemental stipend may not cover the full cost of the benefits depending upon voluntary elections; the stipend is intended to help lessen the financial burden during the transition period. To make changes to benefits, such as HSA contributions, please contact benefits@uidaho.edu to determine if changes are allowed by plan rules and IRS regulations.

Review deductions to ensure all payments are made during this transition period.

To ensure that employee benefits contributions continue during the payroll transition, each person on the old deferred pay system will receive a $1400 stipend on July 3, 2025 — as part of their paycheck. The $1400 stipend will lessen the impact of their employee contributions toward benefits. The benefits coverage during this period will not be affected as long as you make the payments during the transition period.

This stipend is taxable. The supplemental stipend may not cover the full cost of the benefits depending upon voluntary elections; the stipend is intended to help lessen the financial burden during the transition period.

To estimate your benefits expenses during the Summer 2025 transition, do the following:

• Log on to MyUI.
• Select the Employee Resources card.
• Click on the myBenefits tab.
• Select the “View all” link on the bottom left side of your benefits summary. Your per pay period costs will be reflected on the bottom right of the “Your Cost” column.
• Take the “Your Cost” number and multiply it by four to estimate the amount you may be billed for your benefits coverage during the payroll reset period.

Please note, your 2024 benefits elections will be reflected on myBenefits through December 31, 2024. After January 1, 2025, your 2025 benefits elections will be displayed. If you have additional questions, please contact Benefits at benefits@uidaho.edu.

Each employee will need to consult MyUI following the directions above to identify their specific estimates. If you need assistance with that, please contact Benefits at benefits@uidaho.edu.

Yes, you would still need to pay for the employee portion of your contributions to your benefits during that time. Yes, you will still receive the stipend.

That’s right — U of I will continue to make its employer contributions towards your benefits during the transition period.

Employees on standard pay make higher benefits contributions during the academic year so that the cost is managed for the months in between the academic years.

For the faculty who are transitioning their payroll schedule, to have continuing benefits coverage, employee contributions toward benefits must be made.

Yes. They would have to make them after the deferred pay contributions are complete.

Bills will be mailed to your mailing address on file in MyUI. Please review your address in MyUI to verify the correct mailing address.

Unfortunately, this is not possible as U of I cannot withdraw the employee contributions toward benefits in advance. Once you receive your first bill, you can make the payment at that time for all four pay periods or you can pay as you are billed.

Please review your address in MyUI to verify the correct mailing address is on file.

If you would like to do this, please reach out to Benefits at benefits@uidaho.edu to make these arrangements. They can create a password protected way to access the bill in a HIPPA compliant format.

They are sent on the 15th of each month, and you will have a period of time to make your payment.

Their contact information will be on the bill sent to you. If you have questions about your benefits, please contact Benefits at benefits@uidaho.edu.

Employees on standard pay (9 month work and payroll calendar) contribute higher per-pay rates for benefits to cover the summer months. Legacy deferred pay employees contribute at a lower rate over 12 months and the contribution rate can’t be changed mid-year. Standard pay employees contribute over 20 paychecks; deferred/deferred pay employees contribute over 26 paychecks.

All faculty on the old system contribute differently to their benefits; the $1400 stipend is to offset those expenses. The $1400 stipend provides each employee on the old system additional money toward the employee contributions they would have to make anyway.

It’s not possible to customize the stipends for individuals — the benefits system is extremely complex.

All of the employee contributions towards benefits for the transition group was analyzed and resulted in the stipend amount. For the majority of employees, the stipend covers their employee contributions. For those it does not, this is due to their additional and voluntary elections which fall outside of the core benefits.

The stipend may not cover the full employee cost of benefits elected, but does cover the primary benefits such as medical, dental, vision, etc. Depending on the voluntary benefits elected some costs could exceed the stipend amount. Please contact benefits@uidaho.edu to determine if any voluntary deductions are eligible to be adjusted in accordance with IRS rules.

The benefits are cancelled.

Your final paycheck would be allocated two weeks after you finish your work. Your benefits conclude on your final day of work. This is the same scenario for retiring at any point during the year. Whether you are paid on deferred pay or standard pay has no bearing on this. You will receive the full amount of salary based on your end date.

U of I is a self-insured institution. Benefits coverage always ends on the last day of contracted work. For academic year faculty, benefits contributions are made with the assumption of a continuation of work and are withheld based on the manner in which they have selected to be paid. If someone is on an academic year contract and quits over the summer, their benefits coverage ends on the last day of their contract (which would be the end of the academic year in May). Then, payroll and benefits review contributions made and in some cases, the employee is owed money and in others they owe money. Contact Benefits at benefits@uidaho.edu with specific scenarios.

It varied from employee to employee. U of I implemented 20 pay contributions benefits in January 2016. Initially, this was a voluntary opt-in so those that opted into 20 pay for benefits had their benefits spread over the 20 pays they received. If someone did not opt-in, they paid out of pocket through the billing process if they did not have their pay spread. Prior to the implementation of 20 pay, everyone paid through the billing process for the summer months.

If you have direct deposit, you can split your paycheck into another account with your current bank or split your paycheck to another bank with another account. View the instructions to set up direct deposit and split your paychecks. You can decide how much you would like to save. To make up the different gaps in pay, these are the percentages you would need to save from your academic year paycheck to manage that gap fully on your own beginning at the start of AY 25:

Four paycheck gap for the legacy deferred pay schedule reset

15%

Summer 14 week gap between academic year 2025 and 2026 (note: the summer period is normally 13 weeks, but it is 14 weeks in this schedule due to U of I’s biweekly pay schedule)

27%

Currently, several local and national banks offer high interest rate savings accounts. As you budget for the gaps in pay, you might consider saving a percentage of funds into a higher interest rate savings account for a better return on these funds.

There are other ways to save and invest your funds. Please consult your financial advisor about these options.

U of I also offers low-cost loans for employees through a voluntary benefit program. These are repaid through U of I payroll deduction.

U of I also has an employee assistance program that provides many benefits including financial consultations.