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February 03, 2014

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Orin Kerr

Maybe I'm just missing something, but I don't understand the ethical concern. The point of the buy-out is to lower long-term costs. Tenure is presently giving the senior professor an ongoing windfall, and the buy-out can end the windfall for a price. The buy-out is a reward, but so is the guaranteed lifetime employment that is tenure -- and that the person gives up by taking the buy-out. I also don't see how the gender of the individuals who receive buy-out offers creates ethical problems. The gender of the faculty can be important, but i don't see why it's an ethics issue.

CBR

Orin, I think it's a windfall to departing faculty members to the extent that the value of what the school gets (one less tenured salary to pay for some number of years) exceeds the cost of the buyout. And the value of losing the tenured person (how many years' salary are they saving?) may be hard to estimate. If the school is in danger of insolvency, paying the buyout now could harm the school's ability to continue as a going concern (and thus raise the equity issues that Jeff identifies). Also, if the school is that close to insolvency (and some surely are, probably more than faculty want to admit), then it would be better off simply declaring financial exigency and eliminating positions without any buyout. I could see a school in Year 1 offer a buyout, then in Year 2 realize that things are worse than they thought and terminate positions without a buyout. Anyone who left in Year 1 certainly got a windfall comparatively.

CBR

And by "exceeds," I mean, "is less than"... that is, if the school saves less money over time than they had to pay the departing person to leave, that is a windfall to the departing person at a cost to all other stakeholders of the institution.

Paul Campos

The word "voluntary" can get pretty slippery in these situations. I was told by people directly involved in the matter that Florida Coastal got several tenured faculty members to "voluntarily" accept buyouts last summer, by threatening to declare a financial exigency if they didn't take the deal, in which case they would be fired with no severance.

I would be very surprised if this were the only law school at which such "voluntary" buyouts have occurred in the last year or two, and indeed an earlier comment in this thread suggests FCSL is hardly alone in this regard.

(Anyone interested in the FCSL situation can read the details at Lawyers Guns and Money).

Orin Kerr

CBR, thanks for the response. Those concerns sound purely financial, though; they're about how to save money, not about ethics.

E

Dead wood was a problem before the crisis - it's a failure of the tenure system, and the result of a lack of meaningful post-tenure review. Law profs who game the system make all of us look bad - they need to be publicly shamed and held accountable to the students and Board of Trustees - instituting for cause proceedings to terminate is the smart short and long term move....let the dead wood argue why they are so great when their student reviews are horrible and they haven't published anything remotely worthwhile in years. Deans would be wise to provide accurate annual reviews for faculty -- this could serve as a warning call, and perhaps motivate some to act. For reasons many have observed on this blog and elsewhere, tenure is still an important part of the academic model, though it should not be a trump card for failing to do your job.

Jeff Harrison

I too am puzzle by the notions of windfall and ethics. The buyout seems like a risk shifting decision. If a school offers 5 70 year olds 300k each to leave, the school loses on those who would have retired anyway in a year or so and wins on those who would have stuck around for 5 years, for example. It gets what it pays for -- a departure -- and if it does its home work (like an insurance company) it comes out ahead. As for the ethics, I do understand the problem of some soon to be retirees feathering their nests (eggs) but Law Profs who raise the cost of the operation by way of low teaching loads, small classes, and lots of confercations seem as guilty of endangering the solvency of the operation as old folks sticking around.

TWBB

Orin: It does implicate an ethical component when you're looking at where the money used to perform these buyouts comes from. Students are basically being asked to foot the bill to essentially bribe oftentimes poorly-performing faculty to leave.

I think some sort of moral calculus absolutely enters the picture when a law school administrator is deciding whether to offer a buy-out or simply declare a financial exigency and fire a law professor who (if prudent) should have amassed a comfortable level of assets to support him- or herself, as well as (even if not prudent) a generous retirement package. Why should his or her financial interest trump the students taking on enormous debt to receive far less opportunity?

anon

Are any of the suits for misrepresentation in the inducement to attend law school still pending? If so, might these pay-offs be deemed to be a form of fraudulent conveyances?

Jeff Redding

Ellen: Thank you for the information about buy-outs at your institution. The shape of these programs seem to be rarely publicly discussed, so your information is helpful and interesting.

Nancy: I agree, this conversation cannot really occur in a vacuum that does not take up faculty compensation more generally. I've thought about another blog entry on mandatory retirement, something seemingly taboo in the U.S. but common elsewhere… buy-outs seem, to me, to be a very chaotic way of dealing with a problem that could be handled more systematically via mandatory retirement ages, whether that be 65 or 75 or 'after 30 years of service.'

Former Law Review Editor

Jeff Redding,

"a gendered transfer of institutional resources"? And then law faculty wonder why they're the subject of so much derision and why the smart money views law school as a scam.

In case the problem (or "problems") with the quote is/are not immediately apparent, let me elaborate. First, has anyone even suggested that the buyouts are motivated by gender animus? That buyouts of the old crop of disproportionately male law profs would inure to the benefit of male law profs does not create an ethical issue in any meaningful sense of the term "ethical." How about the transfer to the geriatric law profs being more of a concern that it's more dough going to the grey hairs. Isn't that more of an ethical concern? But that's the whole point of these buyouts, to get the grey hairs out.

Second, it's not "institutional resources." It is student tuition dollars. You've built a system that is too big, too fat, too intransigent, too impractical, and too expensive to exist at most schools, with student outcomes too poor to support the school at half the price. If there were anything approaching a "market" for tuition, no lender in his right mind would allow a 22 year old rube to enroll. Wake up!

terry malloy

I agree with Former Law Review Editor.


Two thieves standing over a beaten robbery victim, counting their "institutional resources."

Ellen

TWBB: You state that it is somehow unethical for students to foot the bill to rid the school of incompetent/underperforming faculty. How is that less ethical than having the school keep these people on the faculty at top pay and in the classroom where they continue to cause damage?? Seems to me that students are better off with them out the door.

Jeff Redding

FLRE: So nice to hear from you again. Thank you for the lesson in scam-speak; I knew I was probably getting it wrong. As for understanding gender animus and complex grammar, you are welcome to sit in on my family law and comparative family law courses next academic year; we can talk more there.

BoredJD

Ellen- I think what TWBB is saying is that it's better for a school to declare financial exigency and fire the faculty with no buyout or a much smaller buyout.

The response might be that the school's academic reputation will take a nosedive, leading to a drop in the rankings, thus hurting the students in the employment market. However, (1) most of the schools considering this are already so low ranked that dropping more spots is unlikely to measurably affect their prestige, (2) outside of the elite schools, USNWR has a poor or nonexistent correlation with employment prospects. A student might be better off with the school falling 20 spots in the rankings if it saved them 30K in overall debt from cuts to faculty salaries and benefits.

There are other considerations that I am probably missing, but that it would have a negative effect on student employment just cannot be one.

Emperor's clothes


If we take you up on your offer to allow "scam speakers" to sit in on your family law lectures, will we learn any "family law"? You know, things like drafting custody agreements, how to both calculate and also negotiate maintenance or alimony, how government benefits impact property distribution calculations, how to find hidden assets and when you can subpoena bank records, when to advise a family law client to file for bankruptcy, how to bill a client and get paid for the representation, etc.

You've probably done scores of these in your many years of family law practice before you entered the academy, right? Can do them in your sleep? Or you've probably done each of these things at least one time (on your own, not watching someone else) for an actual paying client, right?

Please tell me that there are some people in law school land who understand MacK et al's critiques. If the med school cardiology and circulatory systems class was taught by an instructor with no practical knowledge of cardiology, there would be hell to pay. Or are you all still drinking the Kool Aid of the old canard about teaching you how to think like a family law lawyer?

I don't fault law profs for worrying about self preservation. You have a very nice gig going, and lots of personal things in your lives that would make leaving the academy difficult (family obligations, student loans, mortgages, etc.) I'd be content to know that a few of you feel a little guilty about the current system.

Jeff Redding

Emperor: I (still) don't understand scam-speak so well, but if you are asking if I can help out with your divorce, I'm afraid not. But you are still welcome to sit in on the class next semester. I hope things get better for you soon.

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