7.6 Layoff for Lack of Work or Funds

This policy was last updated December 18, 2023. See the update history page for more information.

If it becomes necessary to terminate an individual's employment or reduce their hours or work effort because of reduced funding, changes in the nature and scope of the work, or for other operational reasons, the termination or reduction in hours or effort is considered a layoff. A position from which an employee has been laid off may not be filled for at least one year, except in unusual circumstances and with the prior approval of the Vice President for Human Resources. The following will not be considered a layoff: (1) a furlough as described in the MIT Employment Policy Manual Section; (2) a reduction in hours of five or less per week or a reduction in effort of 20% or less; (3) the expiration of an appointment with a specifically stated termination date; (4) termination of employment on account of resignation, retirement, or discharge. All employees whose hours are reduced by five or less per week or whose effort is reduced by 20% or less are entitled to eight weeks of prior notice.

7.6.1 Decision Criteria

In making a layoff decision, where the choice is not clearly dictated by the work to be eliminated or changed and the range of skills of those engaged in it, departments should carefully consider three important factors: individual performance, the length of employee service, and the status and goals of affirmative action in the department. No one of these considerations automatically outweighs the other. They must each be judged and balanced in such a way as to be as fair as possible to the individuals concerned while also serving the Institute's need for an effective staff.

While seniority is not an overriding factor in personnel administration at MIT, length of service at the Institute must be an important consideration in determining individuals to be laid off. Long service testifies to loyalty and commitment and implies a record of responsible performance. At the same time, outstanding work must also be recognized in layoff decisions. Superior performance on the part of an individual with less service may lead to a decision to retain the more junior person. Similarly, our commitment to the employment and advancement of women and members of minority groups must play a part in the layoff decision. Underrepresentation of minorities and women within the department should be an influential factor in the decision.

The final choice in each instance will derive from the interplay of these criteria, and each should be considered and weighed. It is important to remember that layoff notices carry the presumption that the individuals receiving them are valuable contributing members of the community who must be released only because insufficient work and/or funds exist to continue their employment. While performance may be considered, layoff is not a method of terminating an employee solely because they have not performed in an acceptable manner. The regular Institute policy on disciplinary action and termination for cause should be followed in such cases.

Employees who receive a layoff notice are encouraged to review job postings for other positions at MIT for which they may be qualified. If they apply for such a position, they should contact their Human Resources Officer. Hiring managers in departments are encouraged to consider qualified employees on layoff notice for available positions.

7.6.2 Review by Human Resources Officer and Approval by Senior Officer

Departments are urged to consult with their Human Resources Officer for assistance in assuring that all Institute policies and procedures pertaining to layoff are fully understood and applied.

For each person to be laid off, a department must send a statement of reasons to the appropriate Senior Officer or their designee and its Human Resources Officer for their review (see http://web.mit.edu/orgchart/replist.html for list of Senior Officers). The statement should indicate if the individual is (1) a minority employee; (2) a woman with exempt status (Administrative, Sponsored Research, or Academic staff); or (3) an individual with ten or more years of continuous service. Approval of the Senior Officer or their designee is required prior to notifying an employee that they will be laid off.

7.6.3 Letter of Notification

When the layoff decisions have been made, each individual affected must be sent a letter of notice. A copy of the letter of notification should be forwarded to the Human Resources Officer at the time it is given to the individual. The letter should inform the individual of the reason for the layoff and the length of the notice period. It should be made clear that the individual is expected to carry out their usual responsibilities during the notice period but that a reasonable amount of time will be allowed to seek another position at MIT or elsewhere. The letter of notice should also suggest that the individual contact their Human Resources Officer for information about benefits and resources available to laid-off employees.

7.6.4 Layoff Notice Period

The period of notice does not represent severance pay but rather a period during which the individual continues to be employed at their regular salary until a specified layoff date or until the individual is employed elsewhere, whichever comes earlier. The period of notice is calculated using the employee's current employment date; that is, if an employee was reinstated at MIT, the work before reinstatement is not considered.

Administrative Staff and Sponsored Research Staff, except for Principal Research Scientists/Engineers/Associates, will be given the following notice:

  • 0 to 1 year of service — 2 months of notice
  • 1 to 5 years of service — 3 months of notice
  • 5 or more years of service — 3 months of notice plus 1 additional week for each year of service or major portion thereof (6 months or more) over 5 years

The notice period for Principal Research Scientists/Engineers/Associates is found at Section 5.2.1. The notice period for the Academic Research Staff titles of Senior Research Scientist/Engineer/Associate is found at Section 5.3.1 and for Post Doctoral Associates and Senior Post Doctoral Associates at Section 5.3.2 of Policies & Procedures.

Support Staff will be given the following notice:

  • 0 to 5 years of service — 2 months of notice
  • 5 or more years of service — 2 months of notice plus 1 additional week for each year of service or major portion thereof (6 months or more) over 5 years

When concerns about security or workplace safety warrant, a department may relieve an employee of the obligation to report to work during all or part of the notice period; the notice requirement may then be fulfilled through a lump sum payment, salary continuation, or a combination of both. A statement of reasons and the prior approval of the appropriate Senior Officer or designee and the Vice President of Human Resources are required (see http://web.mit.edu/orgchart/replist.html for list of Senior Officers). Other instances where the interests of MIT may be served by relieving an employee of the obligation to work during all or part of the notice period will be approved by the Vice President of Human Resources and the appropriate Senior Officer or designee on a case-by-case basis. In all instances where an employee is not required to work after notice of layoff, departments must fund the notice period and process payment through designated accounts.

7.6.5 Funding of Notice to Long-Service Personnel

When the minimum notice period for service in excess of five years cannot be supported by the funds available in a contract or grant, the salary costs for the additional notice may be absorbed by funds administered centrally by the department or other administrative unit. In such a case, arrangements to draw on such funds must be approved by the Vice President for Human Resources, as well as by the Department Head of the area from which the funds are drawn.

7.6.6 Extension of Medical Coverage in the Event of Layoff

Staff members who are laid off because of a lack of work or funds may extend their health insurance coverage. For employees who are laid off but are not eligible to retire at the end of the notice period, MIT will subsidize part of the cost of health insurance for a defined number of months, calculated based on the amount of MIT service from the current employment date. The Benefits Office can provide information regarding eligibility for, and duration of, this extension of health insurance.