University of Hawai'i President M.R.C. Greenwood yesterday rejected the faculty union's demand that she retract her Dec. 28 letter that unilaterally imposed an 18-month pay cut for UH faculty.

The union had called on Greenwood to retract the letter by 4 p.m. yesterday.

Late yesterday, the university's public relations arm distributed a news release indicating Greenwood's intent to go forward with the pay cuts and inviting the University of Hawai'i Professional Assembly leadership to meet with UH system representatives to resolve an impasse in contract negotiations.

"The temporary salary reductions are necessary to stabilize the financial crisis resulting from the loss of $154 million dollars to operate the university for the rest of this year and next," Greenwood said in the release.

Citing an impasse in negotiations and the need to quickly address the university's financial situation, Greenwood last week said she would implement the administration's "last, best, final offer," which includes a 6.667 pay cut for most faculty. That reduction went into effect Friday.

UHPA accused the UH administration of breach of contract and filed a grievance calling for Greenwood to retract the letter and for the two sides to meet with an arbitrator. In an e-mail forwarded to UHPA members Monday, the union said "the rapid response is needed due to the magnitude of (Greenwood's) proposed action and to avoid litigation."

The faculty contract expired June 30. UHPA, citing a previous arbitration ruling, maintains that it remains in effect until a new one is signed and that any changes must be negotiated.

In a letter sent by Greenwood to UHPA executive director J.N. Musto yesterday, Greenwood invited union leaders to meet with her, John Morton, UH vice president for community colleges and chief negotiations spokesman, and Howard Todo, UH vice president for budget and finance and chief financial officer.

UHPA officials did not immediately return a call from The Advertiser.