Yeshiva University denies Madoff link as 60 are laid off

Posted

By Michael Orbach and Mayer Fertig

Issue of Feb. 13, 2009 / 19 Shevat 5769

This is an updated version of the exclusive story posted Monday Feb. 9, 2009

Yeshiva University laid off 60 employees this week in a move that a spokesman described as part of its continuing response to the global economic downturn.

President Richard Joel made the grim announcement in a letter to the “Yeshiva University Community,” which was obtained by The Jewish Star and first reported on its Web site Monday night.

The cuts will be made across the university's Manhattan campuses, as part of an effort to trim the budget by $30 million, Joel said.

Other employees were offered compensation packages to leave their jobs without being laid off; some will voluntarily work fewer hours; all salaries across the university are frozen, said Rick Matthews of the public relations firm Rubenstein & Associates. The firm was retained in the wake of the Bernard Madoff debacle in December.

Madoff, the former chairman of Yeshiva's Sy Syms School of Business, and the $110 million Yeshiva first estimated had been lost to his alleged Ponzi scheme, were not a factor in the layoffs, Matthews said.

“The endowment had already been impacted significantly by the global economic downturn,” he said, also citing a need to maintain affordable tuitions.

Madoff reached a partial agreement with the Securities and Exchange Commission Monday. He agreed to not contest the facts of the civil case against him. Penalties are to be assessed at a later date, and he still faces criminal prosecution. A list of Madoff's victims released earlier this week includes dozens of residents of the Five Towns.

An angry YU employee who lost her job on Monday spoke to The Jewish Star on the condition that she not be identified. “They affect the little people, the people that make the university run,” she said. “The administration is the bread and butter of the university. Had all the senior staff taken a two percent cut it wouldn't have been necessary to cut all these jobs for the people that aren't making that much money... Richard Joel makes half a million dollars a year. Why didn't he take a pay cut?”

Matthews declined to offer specifics about affected departments except to say that all of the eliminated positions are in administration.

President Joel's letter described the layoffs as part of an overall staff reduction that, including voluntary separation packages and retirement, will eliminate 120 positions, believed to be about 2.5 percent of YU's work force. The move is part of Yeshiva facing “new economic realities,” he said.

Joel also said a strong severance package would be offered to the employees who lost their jobs, including salary continuation and health benefits. The package goes, “beyond that which is required and normally provided by an institution like ours,” he said.

The letter also cited additional measures like “cutting non-personnel expenses by 23 percent;” “fortifying sound business processes” and “radically scaling back our capital expenditures.”

Yeshiva also plans to keep the cost of attending its undergraduate schools as affordable as possible by freezing tuition and increasing financial aid,” and to focus its “substantial fund raising efforts on student aid and other core priorities.”

Yeshiva is special, the letter concluded, because of “people whose positive attitudes enliven student living and learning in ways both memorable and subtle,” and that YU is now “poorer for having to say goodbye to several of them today.”