Welcome to the Payroll/HR Users Group (PHRUG)

1. Welcome to thePayroll/HR Users Group(PHRUG) Monday, June 4 1:30pm – 4:30pm

2. Today’s Agenda • Welcome and Opening Remarks • Announcements • Direct Pay vs. Interim Warrant Worksheet • Pay Calculation Worksheet • Interims Q&A • Encumbrances • Payroll Checklist • Continuation of Life Insurance • Student Verification • Catastrophic Leave • Overtime Calculations 2

3. Announcements • Mutual of Omaha status • Ensure benefit enrollments are ended • Decision on Wages – July 1 Increases • Auditor’s Office – reports • Records Retention reports • Position Rollovers • Voiding Payroll warrant • Open NIS HR Position • Tools Release for IE 7 3

4. Direct Pay Worksheet vs. Interim Warrant Worksheet

5. Direct Pay Worksheet • Used when employee pays money to the State for any reason (i.e. Insurance, Parking, Overpayment of wages) • If an employee is over-paid wages, please note the amount and year, as over payments from previous years may cause tax repercussions. • Always results in a $0 Net Pay warrant • The employee will not get a stub, but the Agency does get the Journal Entry information to check their General Ledger accounts. • DBA 2000 is used as the offset DBA and should match the amount on the check. • Check must be forwarded to DAS–State Accounting with the form. 5

6. Interim Warrant Worksheet • Used to make a payment to an employee between regular payroll dates. • An interim is onlyrequired when: • Employee starts with a monthly agency • Employee has a termination date of more than 2 weeks before receiving their next paycheck. 6

7. Payroll Calculation Worksheet

8. Payroll Calculation Worksheet • Where is it? • State Accounting website: http://www.das.state.ne.us/accounting/ • Click the Forms Link • Look under Payroll Forms • One worksheet for current year • One worksheet for previous year • Different tax rates 8

9. Payroll Calculation Worksheet • Why use the worksheet? • Determine what you will end up with on an interim • Verify your payroll amounts are correct • What can I fill in on the Payroll Calculation Worksheet? • Health deduction (Sec 125) • Dental deduction (Sec 125) • Medical Reimbursement (Sec 125) • Dep Cr (Sec 125) • Vision deduction (Sec 125) • Parking deduction (Sec 132) • Other deductions not withheld before taxes (pre-tax) • Life Insurance • Credit Union Exemptions (0-99) Pay Cycle (BW or M) Marital Status (S or M) Pay Rate Hours Additional FIT (Fed. Income Tax) Additional SIT (State Income Tax) Retirement tax sheltered (Y or N) Retirement percentage Amount of Deferred Comp. withheld 9

10. Payroll Calculation Worksheet • If you have more than one pay rate, a Payroll Calculation Worksheet is needed for each pay rate. • Please contact the Payroll area of State Accounting with questions. • Send the Payroll Calculation and Interim Payroll worksheets to State Accounting using the “Interim Payroll” Mail-in database link on the State Accounting website. 10

11. Interims – Q & A

12. Payroll Encumbrances

13. Payroll Encumbrances • A Financial person in the Agency will do the actual encumbrance, but here are a few reminders for you to help them encumber the correct amounts for payroll: • Monthly payrolls do not have to encumber their payroll. • Depending on your lag, your agency will encumber different percentages of payroll. • What is encumbered? • Payments made in new fiscal year (beginning July 1, 2007) for costs associated with dates in the fiscal year ending June 30, 2007. 13

14. Payroll Checklist

15. Before Certifying payroll to State Accounting… • Check your Payroll Register for reasonableness. • Using Adobe Acrobat Reader, check for errors or warnings on the following reports and fix before certifying: • R073012 (Payroll Register) • R05229 (Journal Entry Proof/Edit) • Do NOT delete the jobs in your Submitted Job Queue until after payroll is posted by State Accounting. 15

16. Before Certifying payroll to State Accounting… • Check the Journal Entry on the Pay Cycle Workbench. • Ensure correct date is on each line. This date must match the pay date. If it doesn’t, please revise before certifying. • Ensure Debits equal the Credits. If out of balance, correction must be completed before payroll is certified. • Enter “AW*” in the Reference 2 column and make sure the Debits equal the Credits. If out of balance, correction must be completed before payroll is certified. 16

17. Continuation of Life Insurance

18. Continuation of Life Insurance Due to Termination of Employment • When does Coverage End? • Conversion Option • Waiver of Premium Due to Disability 18

19. Continuation of Life Insurance for Employees not Actively at Work • How long can employees pay the group rate for their supplemental and basic life premiums? • When should the conversion be offered? • Waiver of premium due to disability 19

20. Forms • When/How to process: • Life Conversion Enrolment Form • Life Waiver of Premium Claim Form 20

21. Student Verification

22. Student Verification • Please refer to handout • Process effective January 2008 22

23. Student Verification • 45 days prior to the dependents’ birthday, insurance carriers provide list of dependents turning 19. • DAS Benefits sends Student Status Letter and Questionnaire to employee. • If questionnaire is not returned, DAS Benefits notifies Agency HR contact to terminate benefit plans in NIS. Agency HR contact sends COBRA notification to DAS Benefits • Per questionnaire, DAS Benefits directs Agency HR contact to modify dependent information in NIS as necessary. • DAS Benefits sends follow-up letters from existing students January 1 and August 1. 23

24. Catastrophic Leave

25. 10.004.04 Catastrophic Leave • 004.04Catastrophic Leave. • When an employee experiences a catastrophic event, he/she may request catastrophic leave donations. • A catastrophic event is defined as a serious illness or injury resulting in a prolonged absence of at least 30 work days during a 6 month period. • Catastrophic Leave shall be available only to employees who have exhausted their own paid leave and only with approval of the agency head. 25

26. 10.004.04 Catastrophic Leave (cont.) • 004.04A Eligibility of Recipient.Employees shall meet the following criteria before request(s) for donations can be made: • 004.04A1 Be suffering a serious illness or injury resulting in a prolonged absence of at least thirty workdays during the past six months. • 004.04A2 Produce satisfactory medical verification. • 004.04A3 Have completed original probation. • 004.04A4Have exhausted all earned paid leave time including compensatory time off, sick leave and vacation leave. • 004.04A5 Have not offered anything of value in exchange for the donation. 26

27. 10.004.04 Catastrophic Leave (cont.) • 004.04BRequesting Catastrophic Leave. • Employees must submit a written request for catastrophic leave donations to the agency/facility HR office. The request must include substantiating evidence as described in 004.04A.2. • For your convenience, request forms are available from your agency/facility Human Resources office or the DAS State Personnel website. • The HR staff will be responsible to initiate the process to verify eligibility, seek agency head approval, request donations, apply the conversion formula to donations received, advise the employee of donations received and notify the appropriate payroll personnel of changes to receiving/donating employees’ leave balances. • Agency heads and/or their designee[s] must approve catastrophic leave requests before solicitation for donations begin. 27

28. 10.004.04 Catastrophic Leave (cont.) • 004.04CCatastrophic Illness/Injury Donation. • Employees may contribute accrued vacation leave to benefit another State employee in the same agency suffering from a catastrophic illness. (Cannot donate across agency lines.) • Vacation leave shall be donated in no less than 4 hour increments. The contributing employee must identify the specific amount of time donated and the name of the recipient of the donated vacation leave, and forms for that purpose are available from the Employer. • Vacation leave donated and transferred to another State employee pursuant to this provision shall be irrevocably credited to the recipient’s catastrophic leave account. • This differs from NAPE contract covered employees in that donations to NAPE employees go into their sick leave account. 28

29. 10.004.04 Catastrophic Leave (cont.) • 004.04C1 Leave transferred shall be converted to a dollar value and then converted to hours based on the recipient’s hourly rate (e.g., the leave donor’ssalary is $6.00 per hour and the recipient’s salary is $12.00 per hour, thus, inthiscase, twice the amount of hours isneeded to achieve full conversion.) No more than equivalent of 1200 hours of donated leave may be received by an employee during a twelve-month period. 29

30. 10.004.04 Catastrophic Leave (cont.) • 004.04DEligibility of the Donor. Before donating vacation leave, employees shall meet the following criteria: • 004.04D1Only increments of four (4) hours may be donated. • 004.04D2Have not solicited nor accepted anything of value in exchange for the donation. • 004.04D3Have remaining to his/her credit at least 40 hours of accrued vacation leave. 30

31. 10.004.04 Catastrophic Leave (cont.) • 004.04E If catastrophic leave donations exceed that which is needed to cover the catastrophic illness/injury related absence, it shall remain in the catastrophic leave account for a period of one year from the employee’s return to work. Remaining amounts may be used for future absences related to the catastrophic illness/injury (i.e., follow-up medical appointments/treatments). After one year from the date of the employees return from the first period of extended absence, or upon death of the employee, any remaining catastrophic leave balance shall be forfeited. 31

32. 10.004.04 Catastrophic Leave (cont.) • This differs from NAPE in that donations are permanently added to the employees sick leave account and, if not used for the catastrophic illness, may be used for other sick related absences and must be included in the pay out upon the death of the employee. • 004.04F The provisions of this section are non-grievable. 32

33. Catastrophic Leave – Rules Covered Employees • New PDBAs • Pay Types 896 and 898, and Accrual 8605 will not print on the pay stub 33

34. Catastrophic Leave – Rules Covered Employees • Catastrophic Leave Balance will be available • Agencies - via the Benefit/Accrual Inquiry screen and • Employees - via the Leave Balance Inquiry screen in Employee Self Service. • Process for recording donation of vacation leave will be the same for both Rules and NAPE employees. • Process for recording receipt of donated leave for NAPE employees will not change. Descriptions for Pay Types 890 and 180 will be changed to reflect that they are to be used for NAPE employees only. 34

35. Time card is created with Pay Type 896 to add 100 hours to the Catastrophic Leave balance. 35

36. Pay Type 896 is not printed on the Pay Stub… 36

37. …but DBA Review indicates Catastrophic Leave did calculate.

38. After Final Update of Payroll, the Benefit/Accrual Inquiry screen and the Leave Balance Inquiry screen (Employee Self Service) indicate a Catastrophic Leave balance of 100.00 hours. • Note: The Benefit/Accrual Types is L. 38

40. On the next payroll, the employee has used 80 hours of the donated leave. A time card is prepared charging Pay Type 185 for 80 hours. 40

41. The employee’s pay stub reflects the payment. 41

42. After Final Update of Payroll, the Benefits/Accrual Inquiry screen and the Leave Balance Inquiry screen (Employee Self Service) indicate a Catastrophic Leave balance of 20.00 hours. 42

44. On the next payroll, the employee must forfeit the remainder of the catastrophic leave. A time card is prepared charging Pay Type 898 for 20 hours. The 20 hours forfeited is not displayed on the pay stub. 44

45. After Final Update of Payroll, the Benefit/Accrual Inquiry screen and the Leave Balance Inquiry screen (Employee Self Service) indicate a Catastrophic Leave balance of 0.00 hours. 45

47. Calculating Overtime

48. Key Terms • Regular Rate of Pay: • The rate of pay used to calculate overtime premium; determined by dividing the total earnings in a workweek by the total hours worked in a workweek. • Workweek: • Fixed period of 168 hours – seven consecutive 24-hour periods, which is established by the employer for the employee • There are some exceptions for 24/7 care facilities, law enforcement, etc. • Different work weeks can be established for different people • Each workweek stands alone. • Overtime Hours: • Hours worked over 40 in a 7-day, 168 hour period 48

49. Components of Regular Rate… • Eligible employees are entitled to pay at a rate of 1 and ½ times his/her regular rate of pay for each hour of overtime worked. • Based on ALL remuneration earned in that week • Includes shift differentials • Includes on-call pay • Must be calculated on work week (2 weeks or more is not allowed) 49

50. Let’s Calculate • Jane Smith earns $10.00 per hour. She also earns $1.00 per hour shift differential, and earns on-call pay for 24 hours each week which equals $19.20/week. Last week she worked a total of 45 hours. • What would her total compensation be? • What is the regular rate? 50