SPEC Kit 320: Core Benefits · 13
Type of Plan Offered Responses
403(b) 42 89%
457 33 70%
401(a) 18 38%
SRA 14 30%
401(k) 7 15%
Roth 401(k) 5 11%
Roth IRA 4 9%
IRA 2 4%
SIMPLE IRA 2 4%
SEP 1 2%
In all but a few cases, an employee contribution is required for plan participation. For most of the defined
contribution plans there is no vesting period. Thirteen institutions that offer a 403(b) plan reported a vesting
period between 12 and 60 months. Six that offer a 401(a) plan have vesting periods between 36 and 66 months.
Only two of the institutions that offer a 401(k) plan reported a vesting period: one of 12 months, one of 36
months.
In most cases, when there is an employer contribution, the maximum amount ranges from 5% to 10.4% of the
employee’s salary, or whatever limit is legally permissible. Interestingly, for about half of the defined contribu-
tion plans reported the employer makes no contributions to the plan. Apparently, institutions offer plans of this
type largely as a tax-friendly and payroll-deduction-administered retirement savings vehicle for their staff.
Only a little more than a third of the respondents who offer defined contribution plans (15 or 37%) indicated
that retirees receive a health insurance premium subsidy.
Deferred Retirement Option Plans
A Deferred Retirement Option Plan (DROP) is a program under which an employee who would otherwise be
entitled to retire and receive benefits under an employer’s defined benefit retirement plan instead continues
working. The continued compensation and additional years of service are not typically credited for the purposes
of the defined benefit plan formula. Thirteen of 55 responding institutions (24%) offer a DROP to employees.
Early Retirement Incentive Programs
An Early Retirement Incentive Program (ERIP) is an employer-sponsored plan that provides special benefits or
incentives to an employee who makes the decision to retire sooner than they had otherwise planned. Twelve of
the 55 responding institutions (22%) offer an ERIP to employees. Respondents’ comments indicated these plans
are commonly of limited, irregular, or intermittent availability versus an ongoing, continually offered option.
Phased Retirement Programs
A phased retirement program allows an employee to continue working with a reduced workload and eventu-
ally transition from full-time work to full-time retirement. Twenty-five of the 55 responding institutions (46%)
have a formal phased retirement program available for library staff. Respondents described programs that
have preretirement hour reductions (56%), postretirement, part-time assignments (16%), or both options (20%).
Type of Plan Offered Responses
403(b) 42 89%
457 33 70%
401(a) 18 38%
SRA 14 30%
401(k) 7 15%
Roth 401(k) 5 11%
Roth IRA 4 9%
IRA 2 4%
SIMPLE IRA 2 4%
SEP 1 2%
In all but a few cases, an employee contribution is required for plan participation. For most of the defined
contribution plans there is no vesting period. Thirteen institutions that offer a 403(b) plan reported a vesting
period between 12 and 60 months. Six that offer a 401(a) plan have vesting periods between 36 and 66 months.
Only two of the institutions that offer a 401(k) plan reported a vesting period: one of 12 months, one of 36
months.
In most cases, when there is an employer contribution, the maximum amount ranges from 5% to 10.4% of the
employee’s salary, or whatever limit is legally permissible. Interestingly, for about half of the defined contribu-
tion plans reported the employer makes no contributions to the plan. Apparently, institutions offer plans of this
type largely as a tax-friendly and payroll-deduction-administered retirement savings vehicle for their staff.
Only a little more than a third of the respondents who offer defined contribution plans (15 or 37%) indicated
that retirees receive a health insurance premium subsidy.
Deferred Retirement Option Plans
A Deferred Retirement Option Plan (DROP) is a program under which an employee who would otherwise be
entitled to retire and receive benefits under an employer’s defined benefit retirement plan instead continues
working. The continued compensation and additional years of service are not typically credited for the purposes
of the defined benefit plan formula. Thirteen of 55 responding institutions (24%) offer a DROP to employees.
Early Retirement Incentive Programs
An Early Retirement Incentive Program (ERIP) is an employer-sponsored plan that provides special benefits or
incentives to an employee who makes the decision to retire sooner than they had otherwise planned. Twelve of
the 55 responding institutions (22%) offer an ERIP to employees. Respondents’ comments indicated these plans
are commonly of limited, irregular, or intermittent availability versus an ongoing, continually offered option.
Phased Retirement Programs
A phased retirement program allows an employee to continue working with a reduced workload and eventu-
ally transition from full-time work to full-time retirement. Twenty-five of the 55 responding institutions (46%)
have a formal phased retirement program available for library staff. Respondents described programs that
have preretirement hour reductions (56%), postretirement, part-time assignments (16%), or both options (20%).
