�2026 PANC SPRING CONFERENCE�Wilmington, N.C.�April 15, 2026��RIF: Are You Ready? Legal Requirements and Practical Advice

Richard A. Schwartz

Schwartz Law P.L.L.C.

19 West Hargett Street, Suite 1000

Raleigh, North Carolina 27601

Phone: 919-821-9011

Email: rschwartz@schwartzedulaw.com

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©2026 Schwartz Law P.L.L.C.

CURRENT BUDGET PROBLEMS

• Still No State Budget Adopted
• ESSER Funding Cliff
• War in Iran driving up prices/uncertainty
• Escalating EC costs
• Cuts to federal grant programs
• Local budget uncertainties from County
• Anticipated federal budget cuts
• Increasing benefits costs – retirement and health
• State revenue projections and automatic tax cuts

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CURRENT BUDGET PROBLEMS

• Personnel costs (salaries & benefits) in NC school systems typically range between 80-85% of total budget
• Budget pressures are likely to impact personnel decisions
• Deadlines for making personnel decisions will come before you may know:
• State budget figures
• Local county appropriations
• Federal budget impact
• Nonrenewal/contract extension deadlines:
• Contract teachers: written notice by June 1 of final year of contract
• Contract administrators: written notice by May 1 of final year of contract

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CURRENT BUDGET PROBLEMS

• RIF = Math + People with Feelings

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• Budget = Math + Numbers without Feelings

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TOPICS

• What is a RIF? -- Reduction In Force
• Who may be subject to RIF?
• How is a RIF applied?
• Distinguish RIF from nonrenewal
• Healthcare benefits for RIF’d teacher
• Practical Advice

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What is a RIF?

Reduction In Force covers:

• Dismissal
• Demotion
• Reduction to part-time

(G.S. 115C-325(e)(1)l. for career status employees)

(G.S. 115C-325.4(a)(15) for contract teachers)

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What is a RIF?

How it is supposed to work

• Follow policy
• Stated, evidence-based rationale
• Document
• Follow the law

Get legal advice!

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What is a RIF?

Demotion is reduction in salary of a person classified or paid as a:

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• Classroom teacher
• School administrator

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(G.S. 115C-325(a)(4) for career status employees)

(G.S. 115C-325.1(2) for contract employees)

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What is a RIF?

Demote does not include salary reductions resulting from:

• Suspension without pay preliminary to dismissal
• Elimination/reduction of bonus, merit pay, or systemwide reduction of local supplements.
• Reduction due to elimination of special duties

For contract employees, demote also does not include salary reductions resulting from:

• Any reduction of pay as compared to a prior term of contract
• Any reduction in a principal’s salary resulting from a reduction in State funds due to (i) school growth scores, as provided in the Principal Salary Schedule, or (ii) a decline in the ADM of the principal’s school.

(G.S. 115C-325(4)(a) for career employees)

(G.S. 115C-325.1(2) for contract employees)

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What is a RIF?

RIF may be based on “Justifiable Decrease In Positions” due to:

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• District Reorganization, or
• Decreased Enrollment, or
• Decreased funding

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(G.S. 115C-325(e)(1)l. for career employees)

(G.S. 115C-325.4(a)(15) for licensed contract employees)

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Who May Be Subject to RIF?

• Career Employees, under the Tenure Law
• “Career Employee” means: teacher with career status awarded prior to 8/1/13.

(G.S. 115C-325(a)(1a))

• Contract “teacher” as defined in G.S. 115C-325.1(6)
• “School Administrator” as defined in G.S. 115C-325.1(5): principal, assistant principal, or supervisor or director whose major function includes direct or indirect supervision of teaching or the instructional program (as covered under G.S. 115C-287.1(a)(3)).�

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Who May Be Subject to RIF?

What about Noncertified Employees?

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Who May Be Subject to RIF?

What about Noncertified Employees?

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Who May Be Subject to RIF?

What about Noncertified Employees?

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• No specific statute on RIF, but
• Hearing rights for “final administrative decision” that affects:
• “terms or conditions of employment,” or
• “employment status” of any school employee

G.S. 115C-45(c)(3)

• Right to appeal to Board of Education
• No right to appeal the Board’s decision to superior court

(G.S. 115C-45(c))

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Who May Be Subject to RIF?

What about Noncertified Employees?

• Prior to 2013, if Board’s decision concerned “dismissal, demotion or suspension without pay,” it could be appealed to Superior Court, “on the record” to determine whether Board’s decision:
• Violates constitutional provisions
• Exceeds the statutory authority or jurisdiction of the Board
• Is made upon unlawful procedures
• Is affected by other error of law
• Is unsupported by substantial evidence in view of the entire record submitted
• Is arbitrary or capricious
• AND –
• Prior to any Board hearing, a noncertified employee could request and would be entitled to receive written notice as to the reasons for their dismissal, demotion, or suspension without pay.
• G.S. 115C-45(c) was amended to remove this provision in 2013.
• Check to see if this provision is still in your Board policies.

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Who May Be Subject to RIF?

What about Noncertified Employees?

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• Check your local Board policies
• Some Boards have policy for RIF of noncertified/classified employees
• Follow BOTH your policy and G.S. 115C-45(c)

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How Is a RIF Applied?

Board Policy

• Necessary to Determine “Justifiable Decrease” in Positions
• Different Types of RIF Policies
• Seniority
• Points Scheme
• Maintain a Sound and Balanced Educational Program
• Performance

Board Policy and Criteria to be applied should:

• Reflect your priorities
• Enable you to reach them

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How Is a RIF Applied?

Board Policy should provide for:

• Preliminary Determination
• Must consider the following when determining which positions shall be subject to RIF:

(1) Structural considerations, such as identifying positions, departments, courses, programs, operations, and other areas where there are (i) less essential, duplicative, or excessive personnel; (ii) job responsibility and/or position inefficiencies; (iii) opportunities for combined work functions; and/or (iv) decreased student or other demands for curriculum, programs, operations, or other services.

(2) Organizational considerations, such as anticipated organizational needs of the school system and program/school enrollment.

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How Is a RIF Applied?

Board Policy should provide for:

• Preliminary Determination
• Superintendent Recommends to Board:

(1) Grounds for RIF (background info, data, rationale)

(2) Number (estimated number of certified employees/ positions to be reduced)

(3) Areas of Certification/Programs/Responsibilities

Superintendent should not be talking about/recommending people/names at this point; only numbers/positions.

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How Is a RIF Applied?

Board Policy should provide for:

• Preliminary Determination
• Board Determines:

(1) Whether to reduce the number of certified employees; and/or

(2) Whether to reduce terms of employment

• Board Should Consider Alternatives to RIF

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How Is a RIF Applied?

• If Board Approves RIF, then Superintendent Proceeds
• Determination of Individuals to RIF, based on criteria
• Criteria must include work performance (including, but not limited to evaluation ratings) when determination involves employees in similar positions
• Other criteria may be listed in Board policy or developed by Administration
• Potential Exclusions

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How Is a RIF Applied?

• Selection criteria should focus on and allow you to effectively address District needs
• Be sure to document criteria used and how criteria are applied
• Use evidence-based criteria, which may also include subjective recommendations properly supported
• Document!
• Keep records

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How Is a RIF Applied?

• Board policy or regulation or plan developed by Superintendent may list additional criteria/factors to consider in making RIF selections.
• Criteria may include such things as:
• Overall work performance, including (but not limited to) evaluation ratings
• Areas of licensure
• Ability to fulfill multiple roles
• Program enrollment
• Service in extra duty positions
• Ability to fulfill extra duty roles
• Unique talents/abilities
• Degree level
• Length of service in your school system
• Overall experience/length of service
• Other legitimate, non-discriminatory factors
• Exclusions for hard to fill positions

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How Is a RIF Applied?

FOR CAREER EMPLOYEES:

• Individuals selected are Entitled to Due Process/Notice
• For Career Employee, must Comply with Procedures of G.S. 115C-325(e)(2):
• Notice to Career Employee of Superintendent’s

intent to recommend dismissal or demotion

• Notice must state the grounds.
• Career Employee has 15 days to respond and

request a Board hearing (to be held within 10 days)

3. Right to Board Hearing, Upon Request

• No Hearing Officer hearing
• Full Due Process Hearing Before Board under the procedures in G.S. 115C-325(j3)

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How Is a RIF Applied?

FOR CAREER EMPLOYEES (cont’d):

• If no hearing is requested, Superintendent may file their recommendation to the Board
• Board considers Superintendent’s recommendation and any evidence at the hearing (if requested) and determines whether the grounds for the recommendation “are true and substantiated by a preponderance of the evidence.” If so, the Board, if it sees fit, may order dismissal/demotion by approving a Resolution.

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How Is a RIF Applied?

FOR CAREER EMPLOYEES (cont’d):

6. Former Priority Reemployment Rights for Career Employees were eliminated (Effective: July 1, 2011) BUT, names of RIF’d career employees still must be maintained by the board.

• List does not grant any rights or status
• It is now just … a list
• BUT, check your Board policies to see whether your Board grants priority re-hire status

7. Check your Board policy for any additional procedures that may apply.

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How Is a RIF Applied?

FOR CONTRACT TEACHERS AND ADMINISTRATORS:

• Individuals selected are entitled to Due Process/Notice
• For Contract Teachers and Contract Administrators (as defined in G.S. 115C-287.1 and 115C-325.1(5), i.e., principal, assistant principal, supervisor or director whose major function includes direct or indirect supervision of teaching or the instructional program)
• Must comply with G.S. 115C-325.4(b) and (c)

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How Is a RIF Applied?

FOR CONTRACT TEACHERS AND ADMINISTRATORS (cont’d):

1. Notice to Contract Teacher or Administrator of Superintendent’s intent to recommend dismissal or demotion (G.S. 115C-325.4(b) and -325.6(b))
• Notice must state the grounds
2. Contract Teacher or administrator has 14 days to respond and request a Board hearing. After hearing is requested:
• Superintendent submits recommendation to the Board
• If hearing requested, Board sets hearing date within 5 days of receipt of Superintendent’s recommendation and notifies teacher/ administrator of hearing to be held between 10-30 days of notice date. (G.S. 115C-325.6(c))
• Right to hearing, upon request
• Full due process hearing before Board under procedures in G.S. 115C-325.7
• If hearing is not timely requested, Superintendent may file their recommendation to the Board which, if it sees fit, may act by Resolution to accept, reject, or modify the recommendation. (G.S. 115C-325.6(d))

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How Is a RIF Applied?

FOR CONTRACT TEACHERS AND ADMINISTRATORS (cont’d):

5. If a hearing is held, the Board considers Superintendent’s recommendation and all evidence, then acts by Resolution
6. Unlike career teacher RIF, there is no statutory requirement relating to maintaining a list of RIF’d contract employees
• BUT, check your Board policies

7. Check your Board policies for any additional procedures that may apply

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Distinguish Nonrenewal from RIF

• Process/procedures for nonrenewal of contract teachers and administrators
• Nonrenewal provides different (lesser) rights to hearing
• Nonrenewal is a lot easier than RIF
• No legal reason to RIF an employee who can be nonrenewed
• But, not including a nonrenewal employee in the RIF may impact the selection of individuals included in the RIF process
• Nonrenewal does not apply to career employees

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Distinguish Nonrenewal from RIF

• Nonrenewal of Contract Teachers and Administrators at end of contract term

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• Remember, the contract expires on its own at the end of contract term, BUT you still have to comply with statutory procedures

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Distinguish Nonrenewal from RIF

• For Contract Teachers (Follow G.S. 115C-325.3(d) and (e)):
• Superintendent provides written notice by June 1 of decision not to recommend a new contract
• No requirement to provide reasons
• Teacher may then petition the Board within 10 days of receipt of Superintendent’s notice and ask for a hearing

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(cont’d)

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Distinguish Nonrenewal from RIF

FOR CONTRACT TEACHERS (cont’d):

• There is no right to a hearing – only the right to ask for a hearing
• Board has complete discretion whether or not to grant a hearing or otherwise address the request
• If teacher petitions the Board, Board must notify teacher of its decision whether to grant a hearing
• If request for a hearing is granted, it is an informal, limited hearing under G.S. 115C-45(c)
• Board notifies teacher of its decision on nonrenewal by June 15 or, if hearing is granted, within 10 days of hearing or such later date as agreed to by Superintendent and teacher

(cont’d)

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Distinguish Nonrenewal from RIF

FOR CONTRACT TEACHERS (cont’d)

• Neither the Superintendent’s recommendation nor the Board’s decision may be arbitrary, capricious, discriminatory, or for personal or political reasons, or on any basis prohibited by State or Federal law.

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Distinguish Nonrenewal from RIF

FOR CONTRACT ADMINISTRATORS UNDER G.S. 115C-287.1:

• Superintendent provides written notice by May 1 of decision not to recommend a new contract
• No requirement to provide reasons
• If no request for a hearing is filed within 10 days of receipt of Superintendent’s notice, then no further action or notice is necessary and the contract expires
• Administrator may file with the Superintendent a written request for a Board hearing within 10 days of receipt of Superintendent’s notice

(cont’d)

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Distinguish Nonrenewal from RIF

FOR CONTRACT ADMINISTRATORS (cont’d):

• There is a right to a Board hearing if a timely request is filed
• If a timely request for a hearing is made, the Board conducts an informal, limited hearing under G.S. 115C-45(c) and makes a final decision whether or not to offer a new, renewed, or extended administrator contract
• Board notifies administrator of its decision on nonrenewal by June 1
• Neither the Superintendent’s recommendation nor the Board’s decision may be arbitrary, capricious, discriminatory, or for personal or political reasons, or on any basis prohibited by State or Federal law.

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Healthcare Benefits for RIF’d Teacher

• G.S. 135-40(b)(8)
• Applies to any teacher who has completed a 10- or 11- month contract or to any employee employed for 12 or more months
• Whose job is eliminated, in total or in part because of funding
• Would this also apply if an employee is nonrenewed instead of RIF?
• Entitled to partially-contributory health coverage for 12 months, provided they were a member of the State Health Plan at the time of separation
• Thereafter, COBRA benefits begin (for 18 more months)
• Eligibility for this benefit does not apply if the employee retires and receives coverage or is subsequently employed and receives non-contributory health benefit coverage

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Consider Impacts of RIF

• On students
• Larger class sizes
• Fewer class offerings
• Diminished services
• On Teachers, Administrators, Staff
• More work, fewer people
• Staff absorb duties
• Morale
• On Operations – transportation, HR, classified employees and more
• On Public Perception
• Public schools are diminished
• Offering less

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Prior to RIF

• Consider other options
• Transfers
• Normal attrition
• Encourage retirements?

- Be careful and consult legal counsel

• Do not mention age
• Ask about it, but do not push it
• Agreement to Reduction to part-time

- See G.S. 115C-325.3(g) – allows Board and teacher to mutually agree to modify contract to permit part-time employment. If teacher contract is modified to part-time, they are no longer a “teacher” as defined in G.S. 115C-325.1(6).

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Potential Lawsuits

• Failure to follow law or policy
• Due Process violations
• Claims that Superintendent or Board decisions were: arbitrary, capricious, discriminatory, personal, political, or prohibited by State or Federal law
• Contract violations
• Retaliation claims

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Avoid Mistakes

• Failure to follow your own policies
• Identify your goals
• Not just to save money
• Unclear criteria
• Inconsistent criteria
• Misapplied criteria
• Are you using a point system?
• If so, will it allow you to accomplish your goals?
• Poor (or no) documentation
• No surprises

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Best Practices for Boards

• Required to consider alternatives to RIF
• Carefully examine budget/options
• Known vs. unknown factors
• Use objective criteria
• Avoid discussing concerns about individual employees if those concerns are not documented in personnel file
• Keep minutes/records

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Best Practices for HR

• Clearly identify criteria
• Apply criteria consistently and fairly
• Consider “blinding” names (but not required)
• Document and maintain records
• Train supervisors who are having the conversations
• Meet with employees who may be subject to RIF

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Having the Conversation

• Do you just send the notice or have a conversation with employee?
• Conversation before or after notice is sent?
• Will the notice just be based on RIF, or will it include other grounds for dismissal
• For contract teachers and administrators, the process is the same, regardless of grounds
• Who has the conversation?
• Are they trained to do so?

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(cont’d)

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Having the Conversation

• Train supervisors who will be having the conversation
• Know the law and policies applicable
• Be humane and empathetic, but don’t muddle the main message
• Be timely
• Avoid surprises – let the employee know they may be subject to RIF
• Be serious
• Advise them of healthcare benefit under RIF

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Having the Conversation

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Having the Conversation

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Having the Conversation

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Having the Conversation

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Having the Conversation

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Having the Conversation

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Having the Conversation

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Having the Conversation

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Having the Conversation

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Having the Conversation

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Having the Conversation

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Having the Conversation

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Future Trends/Impact

• District demographics
• Use of international teachers
• Use of residency/alternative licensed teachers
• Consolidating/closing schools
• Eliminating/changing programs
• Impact of increased Opportunity Scholarship (vouchers) funding planned for future state budget years
• More private school options
• Potential changes in local property tax
• Private/Charter school enrollment
• Economic disruptions
• Federal funding/programs
• A I

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Relevant Board Policies

• Review your own Board policies for the following:
• Reduction in Force: Teachers and School Administrators (compare to NCSBA PLS Policy 7920)
• Classified Personnel Reduction – Not Required (compare to NCSBA PLS Policy 7921)
• Professional Employees: Demotion and Dismissal (compare to NCSBA PLS Policy 7930)
• Classified Personnel: Suspension and Dismissal (compare to NCSBA PLS Policy 7940)
• Non-Career Status Teachers: Nonrenewal (compare to NCSBA PLS Policy 7950)

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Practical Advice

• You may have a choice, whether to nonrenew or RIF
• For each individual, think carefully about differences in procedure, results, re-hire, benefits if you nonrenew or if you RIF:
• If pure RIF situation
• If performance is a partial consideration
• If the real issue is performance

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Practical Advice

• Check/tune up your Board policies NOW
• Will your policies hamstring you or allow needed flexibility?
• Will your policies allow you to keep your best employees?
• Will your policies protect or damage the educational program?

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(cont’d)

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Practical Advice

• Know whether you are dealing with a career employee or a contract employee
• Different procedures and statutes apply
• Different criteria may apply
• Check your Board policy for criteria

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Practical Advice

• Know your own Board policies:
• Reduction in Force – Licensed Employees – Board is required by law to have a policy
• Reduction in Force – Classified Employees – No legal requirement for the Board to have such a policy
• Fairness, Planning and Clarity matter
• Manage the message
• Document
• Plan with and consult your Board attorney!

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