Each January, some full-time faculty will receive an email from the Benefits Office offering the opportunity to “cash out” their unused sick leave from the previous year. This only occurs after you have accrued at least 420 hours, so folks who are newer and folks with sick leave balances below 420 hours will not receive this email. The offer also only applies to unused sick leave that accrued in the previous year, meaning those who receive the email this January have the chance to cash out any unused sick leave they earned in 2024 (but not all of their sick leave from prior years). Faculty accrue 7 hours for each month worked, so the maximum number of hours anyone might possibly have from the previous year available to cash out would be 84 hours. That would be if no sick leave was used, and they worked summer. That would mean they accrued 7 hours per month in the last year, and 7 hours x 12 months would be 84 hours. Any sick leave that is cashed out cannot take your sick leave balance below 420 hours. So, if a person had 504 hours, with 84 hours being from last year, then they could cash out the full 84 hours from 2024, since they would still have 420 hours left in their balance. However, if they had something like 450 hours, with 84 hours from last year, then they would only be eligible to cash out 30 of those 84 hours.

Unused sick leave from last year can be cashed out at 25% of a faculty member’s hourly rate, and the funds gets deposited into their VEBA account. The hourly rate can be found by taking your annual salary, dividing by 175, and then dividing by 7. As an example, imagine a faculty member currently on Step 10, which currently has an annual salary of $95,869. Faculty have a contract for 175 days, and a workday is defined as 7 hours. So, take $95,869 divide by 175 days (to get daily rate) and then divide that by 7 hours (to get hourly rate). That would be a rate of $78.26 per hour.

The cash out rate is 25% of a faculty member’s hourly rate, so in this example that would be about $19.57 per hour. So, if the person had 60 hours of unused sick leave from the prior year, that would be 60 hours x $19.57, which gives you $1,174.20. If they have 84 hours of eligible sick leave from last year, (84 x $19.57) they could receive a cash out of $1,6433.88. That would be the amount they could elect to have deposited to VEBA if they so choose.  This happens each year in January, and only in January. For more details, you can contact your AHE VPs, AHE President, the Benefits Office, or see Article 7, Section 1, Paragraph E of the Master Contract