Was Ferguson terminated without cause?

MUNCIE — Ball State University says President Paul Ferguson resigned voluntarily, but the terms of his severance agreement sound more like he was terminated without cause.

The severance agreement approved on Monday by the university's board of trustees calls for Ferguson to immediately take a paid, two-month sabbatical leave followed by a year of severance pay at his base salary of $450,000.

Yet the five-year employment contract Ferguson signed in 2014 indicates he would either owe the university damages or it would stop paying him if he resigned before 2019.

When board chairman Rick Hall, an Indianapolis attorney, was asked on Monday whether Ferguson was directed to resign, he responded: "No. He offered to resign."

While on sabbatical leave, Ferguson will be relieved of all presidential duties and Ball State will begin its search for a successor, though the resignation doesn't officially take effect until March 25. The president submitted his resignation on Jan. 25.

"He asked for the sabbatical leave and offered to resign, and the board granted his request," said Hall, who repeatedly called Ferguson's departure a mutual agreement in the best interest of both Ferguson and the university.

Ball State president Ferguson resigns

Hall and other trustees have remained silent on the reasons for Ferguson's sudden and mysterious departure less than 18 months on the job. BSU spokesperson Joan Todd on Tuesday told The Star Press that "there was no scandal. It was a mutual agreement, and that’s all there is to tell."

Dick Shoemaker, a Ball State journalism instructor whose expertise includes media relations, said, "From a PR/communications standpoint, it's unwise to air personal issues. So I think it was handled as best as it could be. I'm not sure if this was leadership, philosophical or personal but I think it was handled in the best way possible."

Not everyone agrees.

"There is a lot of discussion on campus today about the resignation," Becky McDonald, a BSU public relations faculty member, told The Star Press on Tuesday. "Students would like to know why Dr. Ferguson resigned." She, too, would like to know. "I think it would be much better for the university to get in front of the story by ending speculation … The university has many stakeholder(s) — donors, alumni, legislators and future students, to name just a few. These are vital to the success of the university."

Ione DeOllos, an associate professor of sociology, said the speculation circulating among faculty — "such as the trustees will never keep a president that is faculty friendly" — is "probably worse than what they could tell us. It also doesn't help when the front page of the Daily News (student newspaper) is headlining 'University hires crisis control expert' and 'Ferguson's name removed from website.' "

Urban planning professor Bruce Frankel says the Ball State community doesn't need to know "if the reason is personal." If the reason is a policy difference or malfeasance in office, "then we need, and are entitled, to know. Let's eliminate some reasons. It is not because Paul Ferguson is accepting another job." Frankel witnessed Ferguson at a recent University Senate meeting and he was "in high spirits, as usual  … he will be sorely missed."

At this point, there is no discussion that the Senate will take a position, says Amy Harden, associate professor of family/consumer sciences and chair of the Senate.

"It is very difficult and uncomfortable to be left wondering what occurred … ," she said. "As someone who worked with the president, I certainly wish I had more information, The university has been moving forward with the vision President Ferguson was promoting as the model student-centered and community-engaged public research university. It was focusing and enhancing what Ball State has been doing for many years. We are left wondering and guessing if the resignation was personal or professional. The concern now, with not knowing what has occurred, is how will this impact the future, whether the university will lose momentum and traction it has developed."

In the summer of 2014, Ball State and Ferguson entered an employment contract that allowed the university to terminate the agreement without cause at "any time by the Board delivering to the President written notice of the University's intent to terminate this agreement without cause, which notice shall be effective 60 days after the date this notice is delivered."

The 2014 agreement also says, "The Board may require that the president assume sabbatical or professional leave status with pay during the said sixty (60) day period. In the event of such leave, the President agrees to accept same and, during such time period, to use his/her best effort to act in the best interests of the University notwithstanding that he/she would be no longer actively engaged as its President."

The 2014 agreement also says, "If the Board terminates this agreement without cause … the President's employment obligations hereunder shall cease and the University shall pay the President, as liquidated damages … an amount equal to one year of the President's annual base salary … "

By contrast, the 2014 contract requires Ferguson to give the university at least 180 days advance notice before terminating the agreement. "For each month … that such notice is less than 180 days, the President shall pay the university liquidated damages … "

The agreement also allowed Ferguson to resign by giving at least 30 days notice "if the President concludes in good faith that because of changes in the composition or policies of the Board of Trustees or of other events or occurrences of material effect, he can no longer properly and effectively discharge his duties …"  "Upon resignation under this subsection, the University shall be under no further obligation to compensate the President after the effective date of said resignation."

The severance agreement gives Ferguson until Feb. 25 to return his university-owned automobile and to vacate university-owned Bracken House within 30 days of the resignation date. He is allowed to keep his university-owned computer during sabbatical.

Ferguson signed the severance agreement this past Sunday, the day before it was approved at a special meeting of the board of trustees in downtown Indianapolis, where they occasionally meet. The board normally meets in Muncie. A written notice of the meeting, which lacked any agenda listing what would be acted/voted on, was sent  to The Star Press by letter postmarked five days before the meeting. No one from the press or public attended. It's uncharacteristic for the board to not list an agenda. "An agenda doesn't have to be posted unless one is used," Indiana Public Access Counselor Luke Britt told The Star Press. "The use of agendas aren't mandatory for meetings."

The 2014 contract gave the university the right to terminate Ferguson with cause, including moral turpitude, violation of laws and prolonged absence, in which case he would not have been entitled to severance pay. The severance agreement allows the university to issue a public statement and does not allow Ferguson to make any public comments that contradict the public statement. Ball State has agreed to provide Ferguson a reference letter. Ferguson has a duty under the agreement to seek other employment. If he is hired elsewhere, Ball State's obligation to make monthly severance payments would be reduced.

Students react to Ferguson resignation

Contact Seth Slabaugh at (765) 213-5834.