On Thursday 17 August, at 11:00, Senior Management notified all staff by email that the various cost-cutting exercises of the spring term have not been enough to balance the financial situation. The savings on operating costs have amounted to DKK 25 million. But more cost-cutting measures are needed, according to Senior Management, and salaries are the only place to find that kind of money. Therefore, CBS can expect cutbacks of DKK 45 million within the salary budget, equivalent to 60-70 full-time positions. On top of that: another DKK 10 million will be cut from operating costs.
Senior Management will attempt to limit “to the widest possible extent (…) the number of actual dismissals, through natural turnover, senior schemes, voluntary severance agreements, etc.” The reduction in staff will be distributed across departments and administrative units and with a 50/50 split between faculty and administration.
The staff reduction process will be finalised in October. More details will follow: Meetings in departments are currently taking place, and calendar invitations have been sent out for a Town Hall Meeting for employees at 13:00 on Tuesday 22 August at Solbjerg Plads, lecture hall 202. The timeline (see below) presented at department meetings explains the different phases.
Explanation: equity is tied up in property and can’t be spent
This change in strategy has several explanations: one involves rising expenses, but the primary reason cited is that CBS’ equity is tied up in property (buildings). The higher interest rates make the previous strategy – taking out loans in the buildings to reduce this equity – a more costly option.
“It has, so to speak, become too expensive for us to spend our capital,” an announcement from the Senior Management stated in late June on Share (the employee intranet), for the first time mentioning potential job-cutting measures.
Further analyses were carried out during the summer break before the announcement this week, and the CBS General Consultation Committee (HSU) has been consulted.
“It is sad and very regrettable having to reduce the number of employees, which is why we have looked into alternatives during the year,” the announcement on Thursday explained.
Employee representatives: Painful and unfortunate
HSU member and Shop Steward for HK TAP personnel Tine Silfvander comments: “Staff reductions are always difficult, nothing good can be said about them. It’s a fact that 60-70 full-time staff must be cut and it will be painful for both the faculty and administration. Thinking of how hard my colleagues work every day, I have a tough time seeing how to reduce the number of people without a substantial negative effect on the service to colleagues and students.
“We must also consider the colleagues left to take over the tasks of the people dismissed. It’s also important to take care of them. Maybe some things will not get done in the future, and the managers will be responsible for identifying these tasks. Gloomy prospects, in my opinion.”
Chair of the Professors’ Association Nanna Mik-Meyer describes the cutbacks as “an unfortunate situation”.
“In our association we hope dismissing professors can be avoided. I do realise that the departments are facing different budget cuts, but in our association, we still hope to avoid layoffs,” she says.
Stay tuned to CBS WIRE for more news and comments after Tuesday’s Town Hall Meeting.