Then they learned that money from the fund cannot be used to pay credit card bills, child support or any other reoccurring expense. And that applicants have to detail eligible bills, explain how they are attributed to coronavirus and attest in writing that insurance will not cover them.
“I’m confused about why there are so many restrictions, why the funds can’t be distributed evenly among people who need it,” said Abasenia Joie Asuquo, a senior at U-Va. who petitioned the university to support displaced workers and students. “I’m disappointed there’s all of this fine print."
As the novel coronavirus forced college campuses to close or scale down operations, many security guards, janitors and dining-hall workers, employed by independent contractors, were left without work. Universities came under pressure from students to tap often vast financial reserves to help. But the response has been mixed, and some solutions are proving more cumbersome than students anticipated.
Now, as the financial outlook for higher education becomes even more dismal, the responsibility colleges say they have to the people who keep campus running will be tested. Many schools are spending millions of dollars issuing housing refunds while losing revenue from canceled programs, shuttered bookstores and canceled facilities rentals. They’re coming under increasing pressure to offer reductions and rebates on spring tuition. And there is no telling whether enrollment will hold up this fall, or if revenue will bounce back.
"We must be exceptionally good stewards of our resources so that we can continue to carry out our core mission,” U-Va. President James E. Ryan and senior leadership wrote in a message to the school this week. “At the same time, we must never forget that the people at U-Va. — our faculty, staff, and students — remain our greatest asset, and will be the key to our ability to weather this crisis and recover with strength.”
Facing revenue shortfalls from tuition, state funding and research grants, Ryan announced that the university will freeze hiring and salaries and impose a 10 percent pay cut on senior leadership. Other universities have already raised the specter of laying off faculty and staff they directly employ, raising concerns about how contract workers will fare in the long run.
“Theses workers are in great jeopardy,” said Rebecca Kolins Givan, an associate professor of labor studies at Rutgers University. “Universities may be more humane towards them if they’re pushed by public campaigns or student organizing, but the contracts allow them to cut these employees loose. When they’re looking to save money, they’re looking at where it’s easiest to save money and, in many cases, it’s on the back of these workers.”
But student activists, who on many campuses are known to exert pressure to support contract workers, won’t back down. Workers are speaking out, too.
Shamia Hopkins, 31, a line cook at U-Va., has been burning through her savings since Aramark laid her off last month. With three children at home, her grocery bills now resemble a rent payment. She is still waiting to receive unemployment benefits, so the university fund is a godsend. But Hopkins said she was taken aback by the litany of restrictions.
“I’m not trying sound ungrateful. I appreciate what they’re doing, but [the criteria] should be proof that you work for them and there shouldn’t be a list saying we’re not going to pay for this or that,” Hopkins said. “Being laid off means I’ve had to exceed my credit card limit to pay bills, so why can’t I use the money for that debt?"
U-Va. spokesman Wesley Patterson Hester said the fund was designed to take advantage of a provision of the tax code allowing employers to provide emergency assistance to employees without the money being taxed as income. As a result, relief is limited to expenses incurred due to the state of emergency.
At Stanford University, student activists collected 5,400 signatures on a petition imploring the school to extend pay and benefits to the nearly 200 subcontracted janitors and chefs that had been laid off since March. The university first said it could not afford to help. Both the provost and president have taken 20 percent pay cuts, and they’ve braced the university for a rocky fiscal year.
But this week, Stanford said it would use federal aid from the $2.2 trillion bailout bill, together with its own money, to maintain income and benefits for contract workers through June 15.
“These steps are occurring in the face of a longer-term budget challenge we are facing as an institution, and that challenge is significant,” Stanford Provost Persis Drell wrote in a letter to the university community Tuesday.
Some students are calling on schools to tap their endowments. (Stanford’s was $27.7 billion and U-Va.’s $9.6 billion at the end of fiscal 2019.) Givan, the labor professor, agreed, saying universities too often act as if their reserves and endowments are sacred. The money should be there to spend on needs that are in line with their stated values and mission, she said.
But endowments are not savings accounts that colleges can use at will. Because the majority of the funds are restricted, only investment earnings can usually be used to support operations. The pandemic’s impact on global markets may make schools less willing, and less able, to use that money to bail out workers.
“We’re at a very uncertain time,” Craig Carnaroli, executive vice president and the University of Pennsylvania, said in an interview. “Our donors are not immune. We’re going to see a lower endowment payout more than likely.”
Carnaroli suspects all universities are wrestling with ways to scale back spending, without gutting services or harming people who rely on them. University leaders, he said, would like to avoid staff reductions but the duration of the crisis will influence that decision.
The Ivy League university in Philadelphia tapped its reserves to commit $4 million toward an emergency grant fund for third-party contract workers and employees experiencing financial hardship during the pandemic. Penn also agreed to pay dining hall staff laid off by Bon Appétit through the end of the semester, following union pressure and a student petition that received 8,000 signatures.
“Even though we have a need to reserve cash flow, these are important investments trying to signal that we’re all on this together,” Carnaroli said.
Harvard University took similar steps, guaranteeing pay and benefits through May 28 after student activists and workers pressed the issue. But for some contract workers, the guarantee seemed to pave the way for what they argue are unreasonable requests.
In the wake of Harvard’s pledge, Gene Van Buren said his employer, Restaurant Associates, mandated everyone working in the law school dining hall come in on a rotating schedule. Van Buren, 52, takes the subway to Harvard, masked and with a ready supply of hand sanitizer, to cook for several dozen students at the Law School who could not return home. He sees no reason his entire team should risk their health when until recently only a few senior employees were asked to remain on campus.
“I’m talking to co-workers who are in tears, scared about getting sick,” said Van Buren, who has worked at Harvard for almost nine years. “They should at least be paid more if they are forced to come in."
Restaurant Associates said it has taken many steps to keep employees safe while they provide food to the hundreds of students who remain on campus.
Harvard is in discussion with Unite Here Local 26, the union representing dining workers, to address staffing levels. The union has asked the university to allow workers to voluntarily come in and receive hazard pay. Harvard has not agreed to either, according to university spokesman Jonathan Swain.
Meanwhile, the school is pledging cuts to offset the financial wreckage of the virus. On Tuesday, Harvard said it would cancel discretionary spending, forego new hires, delay some projects and reduce the salary of its executive leadership by 25 percent in response to the financial impact of the pandemic.