OVERTIME PAY POLICY CHANGES

1. OVERTIME PAY POLICY CHANGES Presenter: Amanda Louks, UMHHC Payroll Supervisor Policy Expert: Kevin Newman, HSHR Consultant

2. OVERTIME PAY POLICY CHANGES • Agenda: • Educate TK’s, Supervisors, and others about policy changes • Provide Job Aids (TRC lists, this presentation) • Information about 8/80 overtime rule, who is eligible, who is not, how to apply, & compliance • Review scenario’s, ask/answer questions • Review changes to overtime pay for Service/Maintenance Employees covered under the AFSCME agreement, scenario’s, questions.

3. OVERTIME PAY POLICY CHANGEShttp://www.finops.umich.edu/payroll

4. NON-BARGAINED/NON-EXEMPT • 40 hour employee who does not work the holiday, but picks up extra shift on Saturday Days         S       M         T        W         TH       F      SAT  Schedule    0        8         8        8         8        8  0 Actual        0        8        0        8        8    8       8 Record       0      8REG    8HOL   8REG    8REG 8REG 8OTR 32REG                                                                                 8HOL 8OTR    

5. NON-BARGAINED/NON-EXEMPT • 40 hour employee who does work the holiday and picks up an extra shift Saturday (Note: the OTP for working the holiday is not counted in the calculation of time worked for extra hours on Saturday to avoid pyramiding) Days         S       M         T        W         TH       F      SAT  Schedule    0       8         8        8         8        8  0 Actual        0       8        8        8        8    8       8 Record       0     8REG    8HOL   8REG    8REG 8REG 8OTR 8OTP    32REG                                                                                 8OTR 8HOL 8OTP   

6. NON-BARGAINED/NON-EXEMPT • 40  hour employee who works the holiday and then has 2 extra hours on Friday (Note: the OTP for working the holiday is not counted in the calculation of time worked for extra hours on Friday to avoid pyramiding) Days         S       M         T        W         TH       F      SAT  Schedule    0       8         8        8         8        8  0 Actual        0       8        8       8        8    10    0 Record       0     8REG    8HOL   8REG    8REG 8REG 8OTP    2OTR 32REG                                                                                 2OTR 8HOL 8OTP   

7. NON-BARGAINED/NON-EXEMPT • 40  hour employee who works M-F Days        S       M        T         W         TH       F      SAT  Schedule   0       8        8       8         8        8  0 Actual       7       8       5.5       8    8 6.25      8 2.5pts 1.75pts Record     7reg 8reg 5.5reg 8reg 7.25reg3.5otr 8otp 2.5pts.75otr 2.75otp 1.75pts 35.75 reg 4.25 pts 4.25 otr 10.75 otp

8. NON-BARGAINED/NON-EXEMPT • Thought process… Regarding Exception Pay(employees paid based on standard hours, all except temps) • Report OTR in order to reach 40 hours worked before reporting OTP when there are non-worked hours reported as part of the appointment and if employee is part-time

9. NON-BARGAINED/NON-EXEMPT • Points to consider…… • In a true flex environment the employee wouldn’t take PTO if they are working at least up to their appointment for the week • Report PTO only if they don’t make their appointment for the week or if employee has an attendance issue that needs to be tracked • Dept guidelines written and followed consistently

10. NON-BARGAINED/NON-EXEMPT • 40  hour employee who works M-F Days        S       M        T         W         TH       F      SAT  Schedule   0       8        8       8         8        8  0 Actual       7       8       5.5       8    8 6.25      8 Record     7reg 8reg 5.5reg 8reg 8reg 3.5reg 8otp 2.75otp 40 reg 10.75 otp

11. NON-BARGAINED/NON-EXEMPT Example: • I am 40 hours per week. I had 24 hrs PTO time scheduled and I worked 20 hrs.  I take 44 (total hours I need to be paid) less 40 hours paid by exception, so I need to be paid 4 extra hours. • Are they OTP or OTR? Was my total worked hours greater than 40?  • No, so it's OTR for 4 hours.

12. NON-BARGAINED/NON-EXEMPT • 40  hour employee who works M-F Days        S        M        T         W         TH       F      SAT  Schedule   0         8        8       8         8        8  0 Actual       4        8       8        off off off 0 Record      4otr 8reg 8reg 8pts 8pts 8pts 0 16reg 24pts 4otr

13. NON-BARGAINED/NON-EXEMPT • Or in a true flex environment having no attendance issue to track…..

14. NON-BARGAINED/NON-EXEMPT • 40  hour employee who works M-F Days        S        M        T         W         TH       F      SAT  Schedule   0         8        8       8         8        8  0 Actual       4        8       8        off off off 0 Record      4reg 8reg 8reg 8pts 8pts 4pts 0 20reg 20pts

15. NON-BARGAINED/NON-EXEMPT • 40  hour employee who works M-F Days        S        M        T         W         TH       F      SAT  Schedule   0         8        8       8         8        8  0 Actual       0 8 16 8 8 8 0 7a-3p M11p-T3p 7a-3p 7a-3p 7a-3p Record  0 8reg    16reg 8reg 8reg 8otp

16. NON-BARGAINED/NON-EXEMPT • OLP (Overlap), goes away because paying OTP (overtime 1 ½ rate), when working over 8 in a day went away with the Overtime Policy change

17. NON-BARGAINED/NON-EXEMPT • 40  hour employee who works M-F Days        S        M        T         W         TH       F      SAT  Schedule   0         8        8       8         8        8  0 Actual       0 8 8 8 8 8 0 7a-3p M11p-T7a 7a-3p 7a-3p 7a-3p Record  0 8reg    8reg 8reg 8reg 8reg

18. NON-BARGAINED/NON-EXEMPT • Record Questions?

19. Guidelines for 8 and 80 Overtime Rule • Dept of Labor Definition: • Under the "8 and 80" system, the nursing care facility may pay employees -- with whom they have a prior agreement -- overtime for any hours worked after more than 8 hours in a day and more than 80 hours in a 14-day period

20. Guidelines for 8 and 80 Overtime Rule • Expanded Definition: • The Act entitles hospitals, nursing homes, and other healthcare providers that care for inpatients to enter into agreements with their employees whereby the employees will be paid overtime compensation at a rate of 1 ½ times their regular rate of pay for each hour worked in excess of 8 hours in a work day and 80 hours in a 14 day period

21. Guidelines for 8 and 80 Overtime Rule • Who is eligible: • Employees who work in an inpatient hospital setting that operates 24/7 and whose job requires them to work a special schedule because of the 24/7 nature of operation (e.g. security or patient care personnel).

22. Guidelines for 8 and 80 Overtime Rule • Who is not eligible: • Employees at outpatient or ambulatory care facilities (i.e. off-sites, clinics) • If there is a question of whether or not your employees are eligible, call your HR consultant for advisement

23. Guidelines for 8 and 80 Overtime Rule • Purpose of 8 and 80 exception to the over 40 rule: • It benefits healthcare facilities by allowing them to avoid unnecessary overtime pay caused by requirements of a 24/7 operation • Offers eligible employers flexibility to cover the staffing needs in a 24/7 healthcare environment

24. Guidelines for 8 and 80 Overtime Rule • Other provisions for compliance: • 8/80 does not have to be permanent, however, the regulations strongly discourage changes from a 7 day workweek to the 14 day period and back again. • Must be implemented at least for a substantial period of time (No Flip Flopping of the rule whenever it’s convenient)

25. Guidelines for 8 and 80 Overtime Rule • What is a substantial period of time? • HSHR Compensation recommendation • Give 30 day notice before switching from and 8/80 overtime rule to the over 40 in a workweek overtime rule • Have a written agreement with employee in place before using the 8/80 overtime rule

26. Guidelines for 8 and 80 Overtime Rule • If you are currently using the 8/80 rule to pay overtime: • Have a conversation with your HR consultant in order to make sure your department is in compliance with it’s practices • Get written agreements in place if currently using the rule to ensure understanding and compliance with regulations

27. Guidelines for 8 and 80 Overtime Rule • Compliance for employees with multiple jobs/appointments/record numbers: • All jobs must meet eligibility requirements for using the 8/80 overtime rule • All jobs must use the same overtime rule • Communication between dept’s • Written agreement in place for all appointments

28. 8 and 80 overtime rule examples: Days           S       M         T         W         TH       F      SAT  Worked      8        8        0       8       8   9        8 Record       8reg  8reg 0 8reg 8reg 8reg 8reg 1otp Days           S       M         T         W         TH       F      SAT  Worked      0        8        0         8       8   8        8 Record        0 8reg 0 8reg 8reg 8reg 8otp

29. 8 and 80 overtime rule examples:Any Examples you have that you want to go over? Days           S       M         T         W         TH       F      SAT  Worked       Record        Days           S       M         T         W         TH       F      SAT  Worked       Record        

30. 8 and 80 overtime rule examples:Any Examples you have that you want to go over? Days           S       M         T         W         TH       F      SAT  Worked       Record        Days           S       M         T         W         TH       F      SAT  Worked       Record        

31. 8 and 80 overtime rule examples:Any Examples you have that you want to go over? • Record Questions?

32. SERVICE/MAINTENANCE COVERED UNDER AFSCME AGREEMENT Overtime time and a half, (OTP) is paid when: • Working over 8 hours in a day unless the employee has an alternate schedule (i.e. working four 10’s M-Th), or has an agreement in place to flex hours within the week per written request and approval by supervisor (a request must be submitted for each schedule change that needs to be waived) • Worked hours plus any Holiday or Jury Duty hours exceeds 40 hours in the workweek • Additional work schedule is mandated, Mandatory Overtime is paid at one and a half times the employees hourly rate regardless of total work hours in the week • **Exception permitted under FLSA for Survival Flight Dispatchers-3 week rotation of 36, 36, 48 with no more than 1020 hours in a 6 month period

33. SERVICE/MAINTENANCE COVERED UNDER AFSCME AGREEMENT • These are the TRC’s that are used to Calculate OT for Service/Maintenance employees covered under the AFSCME agreement • ECW Emergency Closing-Wkd • HOL Holiday • HPB Hospital Business • HSB Holiday Substitution • JRD Jury Duty • OTR Overtime 1.0 • REG Regular • SEW Season Day Worked • UBS Union Business

34. SERVICE/MAINTENANCE COVERED UNDER AFSCME AGREEMENT • OTM – Overtime 1.5 Mandatory:  Per Article 10, this new time reporting/earnings code is to be used to report mandatory overtime.  An employee is paid at the “time and one-half rate” for all Mandatory overtime hours worked, even if they work less than 40 hours during the workweek.  These hours can be reported on the employee’s Timesheet page by the unit Timekeeper. • OBP – One Time Bank Payout:  Per Article 24, this new earnings code will be used to pay AFSCME employees up to a maximum of 40 One-Time Bank hours upon retirement.  For Plant employees, these payments will be initiated by the Plant Payroll Office via an off-cycle request.  For Hospital AFSCME employees, these off-cycle payments will be initiated by the Hospital Payroll Office.  For all non-Plant Campus AFSCME employees, these payments will be initiated by the Timekeeping Area of the University Payroll Office, upon retirement of the employee.  

35. SERVICE/MAINTENANCE COVERED UNDER AFSCME AGREEMENT • 40 hour employee who does not work the holiday, but picks up extra shift on Saturday Days           S       M         T         W         TH       F      SAT  Schedule     0        8         8         8         8        8 0 Actual         0        8        0         8       8   8        8 Record        0      8REG   8HOL   8REG    8REG 8REG 8OTP 32REG                                                                                8HOL 8OTP

36. SERVICE/MAINTENANCE COVERED UNDER AFSCME AGREEMENT • 40 hour employee who does work the holiday and picks up an extra shift Saturday (Note: the OTP for working the holiday is not counted in the calculation of time worked for extra hours on Saturday to avoid pyramiding) Days         S       M          T        W         TH       F      SAT  Schedule     0       8          8        8         8         8 0 Actual        0       8        8         8        8  8       8 Record       0       8REG    8HOL   8REG    8REG 8REG 8OTP 8OTP    32REG 8HOL 16OTP   

37. SERVICE/MAINTENANCE COVERED UNDER AFSCME AGREEMENT • 40  hour employee who works the holiday and then has 2 extra hours on Friday (Note: the OTP for working the holiday is not counted in the calculation of time worked for extra hours on Friday to avoid pyramiding) Days         S       M        T        W         TH       F      SAT  Schedule     0       8          8         8          8      8  0 Actual         0       8        8        8        8    10    0 Record        0     8REG    8HOL   8REG   8REG 8REG 8OTP   2OTP 32REG                                                                                 8HOL 10OTP   

38. SERVICE/MAINTENANCE COVERED UNDER AFSCME AGREEMENT Days         S       M        T        W         TH       F      SAT  Schedule     0       0          8         8          8      8  8 Actual         0       8        8JRD   8        8    10    8PTS Record        0 8reg 8JRD 8reg 8reg 8OTR 8PTS 2OTP *Gets OTP on Friday for working over 8 in a day *Gets OTR on Friday due to PTS day on Saturday *Actual worked hours not including OTP, plus Jury Duty do not exceed 40 in the workweek

39. SERVICE/MAINTENANCE COVERED UNDER AFSCME AGREEMENT • Record Questions?