OP-D-2-E PAYROLL

SPECIFIC AUTHORITY
Florida Statutes Section 110.113; Section 110.122; Section 122.12
IRS Circular E

OP-D-2-E1 INTRODUCTION

Payroll Services is a unit of the University Controller's Office which processes the University’s payroll.   This unit utilizes the Human Resources module of the University’s OMNI system (OMNI HR) to produce pay checks and electronic fund transfers for employees’ direct deposits, which are processed on a biweekly basis.   The unit also facilitates payments to payroll vendors for employee benefits and payroll deductions.

Other relevant payroll-related information may be found at the University Office of Human Resources site.  Additional HR policies and procedures may also be found on their site.

Payroll Services is located in Room A5600, University Center.  The telephone numbers are 850-644-3813 and 850-644-3814.   E-mail at payroll@admin.fsu.edu.

OP-D-2-E2 DEFINITIONS

A.  JOB CLASSIFICATIONS

1.  SALARY

Employees paid from the Salary category are filling established positions within the University. These employees may gain permanent status in their jobs and are eligible for all benefits (retirement contributions, annual and/or sick leave accruals) provided by the State. The classifications of employees in the Salary category are Faculty, Administrative and Professional (A&P), A&P/Executive Service and University System Personnel Service (USPS). These positions may be one full-time-equivalent or a portion thereof.

The following types of employment constitute dual compensation and are not allowed for employees in the Salary category unless prior approval is obtained in accordance with University policy:

a.  More than one employment during the employee's normal working hours.
b.  Employment in excess of one full-time-equivalent position.
c.  Receipt of compensation simultaneously from any appropriations other than appropriations for salaries.
d.  Receipt of compensation simultaneously from more than one University department.

2.  OTHER PERSONAL SERVICES (OPS)

This category consists of two separate types of compensation – independent contractors and individuals who are being compensated for services rendered by a person who is not a regular full-time employee filling an established position. This shall include, but not be limited to, temporary employees, students or graduate assistants, and common or casual labor. The dual compensation restrictions described in paragraph 1, a-d above also apply to OPS employees.

Careful distinction must be made between those individuals being hired as independent contractors and individuals who are actually employees of the University. Further discussion of the rules regarding independent contractors and employees may be found in OP-D-2-E21.

B.  PAYROLL CERTIFICATION - Dean, Director or Department Head (or their designee) approval of the online certification report is the assurance that the individuals listed on the report are due to be paid, the amount being paid is correct and appropriate entries for absences have been made to affect the employee's records.

C.  OMNI - The Online Management of Networked Information is the Enterprise Resource Planning (ERP) system that the University utilizes to meet its financial and human resource administration needs. The Human Resources module of this system is used to collect time and pay employees.

D.  PAY PERIOD - All University employees are paid on a biweekly basis.

E.  EFT – Electronic fund transfer or direct deposit of wages into a specified bank account occurs instead of issuing a paycheck.

F.  ON-CYCLE PAYROLL – Regular, biweekly payroll is processed during the on-cycle period.

G.  OFF-CYCLE PAYROLL – The off-cycle period is used for payments that could not be processed during the on-cycle. Examples would include adjustments and corrections to pay records, insurance refunds, leave pay-outs requiring special processing, the recording and issuance of manual and/or on-demand checks as well as the processing of check reversals.

OP-D-2-E3 DIVISION OF RESPONSIBILITIES

A.  Payroll Services is part of the Controller's Office and is designated as the central office responsible for processing all payroll data in OMNI HR in order to pay University employees and for facilitating payments to payroll vendors for employee benefits and payroll deductions.

B.   Human Resources is responsible for overseeing that employees are added or terminated from OMNI HR, maintenance of W4 files, and ensuring appropriate documents are being maintained as required by State law and University policy.

C.  The University ERP unit provides technical support of OMNI HR to both the Office of Human Resources and Payroll Services.

D.  Deans, Directors and Department Heads are responsible for the accuracy and reliability of their department's payroll. Although much of the responsibility for preparing the payroll in the department is delegated to a staff person (the Department Representative), department heads need to be familiar with the system. The following guidelines should be used as a tool for efficient payroll processing:

1.  Department Representatives processing new hires and making changes to employee records should be properly trained. Information about available classes, tutorials, and instruction guides on how to utilize OMNI HR may be found on the OMNI website. The Human Resources website also provides training and organizational development for Department Representatives on many topics.

2.  Employees processing time either for themselves or for employees in their department should be trained for their role in using the Time & Labor module. Proper training enables the correct use of Time Reporting Codes (TRC) and assures accurate pay and employee vacation and sick leave accruals and balances.

3.  Employees charged with the responsibility for approving Payable Time should review the employee records and approve the time in accordance with the established payroll schedule. It is important that approvers, in addition to approving payable time, review exceptions (Manager Self Service > Time Management > Manage Exceptions).

4.  Department Representatives should understand when and how Preliminary and Final Cost Center Reports should be reviewed to assure that departmental employees are properly paid and payrolls costs have been recorded properly in the general ledger.

5.  Department Representatives should assure that separation of duties, as described in OP-D-2-E7, is being observed within the department.

E.  Employees are responsible for recording their time in the OMNI HR Timesheet or on a time card, as applicable in accordance with the University policy. When errors occur, employees should immediately contact their Department Representative for advice on the appropriate corrective action. Employees should be encouraged to review their paychecks online prior to pay date to assure its accuracy. When changes to Form W-4 are desired, this change may be made online (Self Service > Payroll and Compensation > W-4 Tax Information). In accordance with University policy OP-C-7-D1, employees are required to enroll in direct deposit and have their wages deposited to the financial institution of their choice.

F.  Persons authorized to sign Pay and Leave Reports as the supervisor or certifying official should:

1.  Ensure that personnel have completed appropriate documents to be placed on the payroll.

2.  Ensure that personnel actions are completed prior to effective date.

3.  Instruct employees in proper maintenance and completion of Pay and Leave Reports and time sheets.

4.  Review Pay and Leave Reports for errors and ensure proper completion.

5.  Sign and forward all Pay and Leave Reports to the Time and Leave Coordinator in a timely manner.

G. Time and Leave Coordinators (TLC) will:

1.  Maintain a list of all signatures of time/leave approval and certification officials.

2.  Review all Pay and Leave Reports for completion, mathematical accuracy and appropriate supporting documentation.

3.  Enter only properly completed Pay and Leave Reports into OMNI.

4.  Make sure all Pay and Leave Reports are signed, approved and input for all employees. Provide the payroll certification officer all Pay and Leave Reports to review against certifications.

5.  Maintain all Pay and Leave Reports and time sheets until approved for destruction by the University's Records Retention Officer.

H.  Paycheck Distributor will:

1.  Pick up paychecks in sufficient time to distribute in a timely manner.

2.  Compare Check Wrapper Sheets to paychecks received to ensure all are present.

3.  Ensure all paychecks remain locked in a safe, filing cabinet, secure desk drawer or other similarly secure place until one of the following events occur:

a.  The individual signs for their paycheck.

b.  Paycheck is distributed in accordance with written instructions of the recipient.

c.  The payroll distribution is assigned to another (non-time entry person) who is assigned by the department to deliver to a sub-unit.

4.  Paychecks that are unattended or stored overnight should be locked in a secure container only accessible to the Paycheck Distributor or other designated backup, who has no other payroll duties.

5.  Note on the Check Wrapper Sheet any paycheck that is undeliverable and is to be returned to Payroll Services.

6.  Sign the Check Wrapper Sheet once all paychecks have been distributed.

7.  Return undeliverable paychecks to Payroll Services within ten (10) business days of the check date with the Memorandum Format to Return Pay Checks to Payroll Services contained in form PR-02 .

8.  If the TLC is involved in any way with the certification process, they may not distribute paychecks. See Section OP-D-2-E7 for further information concerning separation of payroll duties.

OP-D-2-E4 DEPARTMENT REPORTS

A detailed review of reports provided to departments and a clear understanding of the purpose of the reports is critical to ensure proper control over the payroll process. Key reports and documents are:

1.  Preliminary Cost Center Report – This report is used by department’s to verify the accuracy of their payroll before the bi-weekly payroll is processed. If an error is detected, the department representative should submit a Parature ticket to Payroll Services. Human Resources, via OBI Reporting, provides two preliminary Cost Center reports during the on-cycle biweekly process. Cost Center Report I is normally available on Friday afternoon and Cost Center Report II is normally available Monday morning.

2.  Final Cost Center Report – This report, also known as Cost Center Report III, is made available in OBI Reporting after the biweekly payroll is confirmed. This report shows the actual pay amounts. This report should be used by department representatives to verify that the bi-weekly payroll was accurately produced. If an error is detected, the department representative should submit a Parature ticket to Payroll Services. This report is also used to certify the department’s payroll for auditing purposes. Any submitted Parature ticket should be noted on the certification printout.

3.  Check Wrapper Sheet – This report is provided to the department along with the payroll checks picked up It provides a list of all items that should be included, and the distributor should review the Check Wrapper Sheet to ensure that all paychecks are included. Each employee receiving a paycheck must sign the Check Wrapper Sheet (or facsimile) as an acknowledgement that they have received the paycheck. Photocopies of the Check Wrapper Sheet may be utilized as necessary to obtain payee signatures at multiple locations. The distributor must sign the Check Wrapper when finished distributing all items, as evidence of who performed the function. The Check Wrapper Sheet must be kept on file in the department.

4.  Department Charges Report – This report is available in OBI Reporting on the Wednesday of pay week. The report gives the department a summary of all payroll expenses being posted to the general ledger.

OP-D-2-E5 THE PAYROLL PROCESS

A.  In order for new employees to receive their payments on time the department should ensure that the following has occurred:

1.  All required forms have been submitted to and are properly approved by Human Resources. Generally, all forms are required by Human Resources two weeks prior to the pay period ending date. Please refer to Human Resources’ payroll calendar for each pay period’s deadline.

2.  Direct deposit information must be entered through the OMNI Employee Self Service module or a completed form received by Payroll Services by the pay period end date. The university’s direct deposit policy is listed below in section OP-D-2-E6.

3.  The employee has been properly established in OMNI HR and his/her time recorded timely in accordance with the Payroll Schedule.

4.  The employee’s Time Sheet has been approved in accordance with the Payroll Schedule.

On-Cycle Payroll Schedule

Wednesday Run Activities	Thursday Time Entry Deadlilne	Friday Time Approval Deadline
In OBI Reporting, review Activities Report to verify that appointment data submitted prior to deadline is correct. If incorrect, create Parature ticket. Examples of incorrect items: Compensation rate FTE Funding acct codes Funding dates	Time entry is to be completed by 5:00 p.m.	In OMNI, review Employee Payable Time Report to verify time entry is correct. If recorded time is not accurate, correct it and check exceptions/ approvals before NOON. If you have not approved Reported Time by NOON it will not appear in the Cost Center Report (CCR).  Review CCR (Version 1) to verify that pre-calculated pay is correct. If incorrect, look at “Payable Time Detail/Summary” and “Review Paycheck Summary”. These pages may show time that does not appear in the CCR due to changes in Reported Time since the CCR was posted. If employee time is still incorrect, please create a Parature ticket. Continue checking throughout the day for last minute approvals.

C.  Payroll Check Distribution Process - Exception to Direct Deposit Policy: Employees who receive approval from Human Resources to be exempt from direct deposit will receive a paper check. Payroll sorts these checks by departments along with a check wrapper sheet. They are available for pick up from Payroll Services on Friday morning a week following the end of the pay period. Departments designate persons (Check Distributors) who are authorized to pick up paychecks by submitting a completed Paycheck Pick Up Authorization form (PR-03) to Payroll Services. Check Distributors will distribute and secure checks as outlined in OP-D-2-E3, item H.

OP-D-2-E6 DIRECT DEPOSIT

A.  Section 110.113, Florida Statutes requires employees hired after July 1, 1996, or current employees changing pay plans, to participate in EFT of their pay to a financial institution as a condition of employment. Employees who are not able to participate in direct deposit must seek exception through Human Resources.

B.  Upon employment, employees should complete the Direct Deposit Authorization form (PR-06) as part of the hiring package. As soon as the employee’s appointment is in OMNI, the necessary banking information must be entered into the system in order to establish the direct deposit. This can be accomplished by either forwarding the Direct Deposit Authorization form to Payroll Services so that they can input the necessary information into OMNI or through the use OMNI Self Service by the employee. If using OMNI Self Service, employees should remember that they may have their pay directed to up to two different financial institutions. Employees may also want to consult the Direct Deposit Job Aid.

OP-D-2-E7 INTERNAL CONTROLS

It is essential that departments assure proper internal controls are in place related to the payroll process. These controls include:

1.  There should be separation of duties between the recording or approving of time worked, the addition/removal of employees from the payroll system and the making of any changes to employee records.

2.  The review and proper approval of pay and leave information to ensure that hours worked and leave taken are correctly recorded.

3.  The assurance that undelivered payroll checks, earnings statements and other sensitive payroll-related documents are properly secured prior to delivery.

OP-D-2-E8 WITHHOLDING TAX/FICA/RETIREMENT AMOUNTS

The amounts required for Income Tax withholding, FICA contributions and Retirement amounts are set by federal and state law and are subject to change annually. The amounts required to be withheld are published annually in IRS Circular E. If individuals do not have access to these publications Payroll Services should be contacted for specific information.

OP-D-2-E9 PROCESSING PAY AND LEAVE REPORTS

Departments may choose one of two options in order to track and authorize time worked and leave taken by employees. Departments may decide to use paper Pay and Leave Reports or they may choose to have employees enter their own hours through OMNI Self Service. Job aids are available to aid departments regardless of the option chosen.

If departments choose to use paper Pay and Leave Reports, they will be able to print the reports for non-exempt employees through OBI Reporting on the Tuesday following a pay period end. These reports should be signed by the employee and his or her supervisor and forwarded to the department’s Time and Leave Coordinator for data entry into OMNI.

OP-D-2-E10 ANNUAL LEAVE PAYMENTS

A.  Annual leave pay-outs are made upon termination of an employee from the work force. Annual leave is subject to normal taxes (based on the employee’s retirement code when the leave was accrued) and retirement withholdings.

B.  After an employee’s final paycheck has been issued and an audit of their leave balance has been conducted and approved by Human Resources, the annual leave pay-out will be processed with the next available pay cycle. OMNI is the official leave record of the employee and must be properly maintained by the department. Additional information may be found in the complete University leave pay-out policy (OP-C-7-E).

C.  Input of annual leave for final payment is initiated in either the Dean of Faculties Office or Human Resources depending on the employee’s status and is subject to audit.

D.  The one exception to the above situation is if an employee takes an OPS job prior to payment of annual leave, then the termination PAF must be sent to Payroll Services for manual input to OMNI.

E.  Individuals wishing to withhold Tax Sheltered Annuities (TSA) or Medical Reimbursement Accounts (MRA) from final leave payments must provide the Dean of the Faculties or Human Resources (as applicable) with the appropriate authorization prior to termination. The termination Personnel Action Form (PAF) and the appropriate TSA/MRA will then be submitted to Payroll Services for manual input into OMNI.

OP-D-2-E11 BENEFICIARY PAYMENTS

A.  In the event of an employee's death, the employee's department should notify Human Resources’ Benefits department immediately. Any accrued wages, annual leave, sick leave, and special compensatory leave may be paid to the decedent's beneficiary, estate, or as otherwise provided by law (see Florida Statutes Section 122.12).

B.  Human Resources will coordinate with the beneficiary to assure that an affidavit is signed before a notary in order for the beneficiary to receive the payment due to him/her from the University. If the monies are due an estate, the proper legal documents are to be submitted to Payroll Services through the employee's department.

C.  The beneficiary payment documents have no scheduled submission date. Payments are processed on an off cycle payroll after receipt of the documents by Payroll Services.

D.  Federal withholding tax is not withheld from payments made to beneficiaries.

E.  Beneficiary wage payments which are made in a year subsequent to the year of the employee's death are not subject to the FICA tax. However, beneficiary payments made in the same year as the employee's death are subject to FICA tax.

F.  The payment will be mailed directly to the beneficiary when it becomes available.

OP-D-2-E12 OVERTIME PAYMENTS

A.  The Fair Labor Standards Act (FLSA) is the Federal Law which governs payment of overtime to non-exempt employees. The Portal Act establishes punitive guidelines for failure to comply with FLSA.

B.  Overtime is to be paid at one and a half times the normal pay rate and accrues based on an employee actually working 40 hours in a work week. Holiday hours, sick and annual leave, do not count as hours worked and will impact whether or not an employee is entitled to overtime premium.

C.  OMNI automatically pays overtime in accordance with the FLSA and calculates the overtime premium on a weighted average basis when more than one position is being occupied.

D.  Departments should be aware that when approving dual comp for employees, they may be charged for an overtime premium.

OP-D-2-E13 SICK LEAVE PAYMENTS

A.  Section 110.122, Florida Statutes governs the payment of sick leave. Employees must have ten (10) or more years of credible service to be entitled to sick leave payment. Years of service used for previous sick leave pay-outs may be counted again. Employees will be paid, at the rate of pay applicable at the time the employee leaves the University, for one-fourth of unused sick leave accrued after October 1, 1973, up to a total of 480 hours. Employees with fewer than ten (10) years of service will forfeit all accumulated sick leave at the time of their termination.

B.  Sick leave is presently a manual payment and must be audited by either the Dean of the Faculties or the Director of Human Resources, and Compensation Services before payment can be made by Payroll Services. Sick leave payments are subject to FICA and Medicare Matching. Additionally, there is no retirement payout included in these payments.

C.  Departments responsible for maintaining sick leave records must forward these records to the appropriate audit area within five (5) work days of the termination date of the employee. (Note: the OMNI record is the official sick leave record and departments are responsible for proper input and maintenance of this record.)

D.  Upon receipt of the sick leave records, the Dean of the Faculties and/or Human Resources will perform an audit of the records and prepare the Authorization for Payment of Unused Sick Leave form. The Dean of the Faculties and Human Resources are also responsible for identifying payments which have requested tax sheltered annuities (TSA), medical reimbursement account (MRA) or deferred compensation. A copy of the request must accompany the Authorization for Payment.

E.  Once this authorization form has been completed and approved payment of sick leave will be made on the first available payroll.

OP-D-2-E14 PAYCHECK REVERSALS

A.  Paychecks are canceled when the payment is deemed to be inappropriate or an error is made in calculation. This cancellation is done in OMNI.

B.  Paychecks to be canceled should be returned to Payroll Services within five (5) working days of the date of issue with an annotation on the paycheck or an attached memo with the reason for cancellation.

OP-D-2-E15 LOST PAYCHECKS

A.  If an employee's check has been lost or destroyed, Payroll Services should be contacted as soon as possible so that a stop payment can be requested. The employee must come to Payroll Services and sign an affidavit for a duplicate check. The employee must bring a photo ID so that the affidavit can be notarized.

B.  The employee will be notified when the duplicate check has been processed.

OP-D-2-E16 SALARY OVERPAYMENT PROCEDURES

A.  Departments are responsible for preventing and identifying overpayments to employees, for notifying employees of overpayments and collecting overpayments in a timely manner.

B.  Overpayments can normally be prevented by the proper review and correction of employees’ Time & Labor records. A number of reports and other tools are available to help departments perform this sort of review. These reports include Actives and Cost Center Reports I and II, all of which are available through OMNI HR OBI Reporting.

C.  In the event that an overpayment occurs, the following steps need to be completed:

1.  The department submits a Parature Ticket detailing the overpayment.

2.  In order to prevent future errors, the department works with Human Resources to make adjustments/corrections to OMNI JOB screens or Time entry.

3.  Payroll processes the adjustments/corrections entered into OMNI JOB screens or time entry on the next pay cycle.

4.  Collection of overpayment is deducted from future pay checks where possible. Alternatively, a reversal of the direct deposit/pay check will be requested. Payroll Services will respond through the Parature ticket as to how the collection is being handled.

5.  The department notifies the employee of the overpayment and the collection process.

OP-D-2-E17 DISTRIBUTION OF W-2s

W-2s are due to be delivered to the employees by January 31st of the year following the prior calendar year. The delivery address file is maintained by Human Resources and is corrected by completion of a new W-4 or from the termination checklist. The address appearing on the paycheck or EFT pay document is the address on record in OMNI.

W-2s will be given to departments for delivery to employees upon completion by Payroll Services. Departments will identify those W-2s that must be mailed and ensure the address is correct and annotate any changes. The W-2 will then be returned to Payroll Services to be mailed. Departments have two working days to accomplish this task.

OP-D-2-E18 RETROACTIVE DISTRIBUTION OF FUNDING

The Retroactive Distribution of Funding (RDF) policy governs any correction or change to the funding source of an individual employee for a prior pay period. This policy relates only to funding and does not apply to any retroactive changes in compensation, employment period, full-time equivalency, position, or status.

A.  RDF Policy: Appropriate Use
The RDF form (PR-01) is required in the following circumstances:

1.  A justified change in the funding source of an individual’s salary

2.  Correction to department charges in the event of delay in the funding change on an employee or sponsored project set up

3.  Correction to erroneous time, leave, and account information entries

4.  Correction to significant differences between an employee's effort reported on Personnel Activity Reporting System (PARS) and actual payroll charges

The RDF form should be necessary only in the above circumstances. This process does not replace the need for the following considerations:

1.  Personnel appointments reflect accurate funding distribution

2.  Personnel and payroll documents are submitted and approved in a timely fashion

3.  PARS data reflect accurate employee effort

4.  Appropriate and timely attention is given to reconciling actual payroll charges to payroll budgets

B.  RDF Policy: Appropriate Timing

The RDF form must be completed and submitted to Payroll Services or Sponsored Research Accounting Services within thirty (30) days from the end of the month in which the error occurred. Should the correction result from the discovery of an effort error during the PARS verification process, then the correction must be submitted within thirty (30) days of the PARS verification discovery.

Corrections submitted beyond the initial 30-day deadline from the end of the month in which the error occurred require a separate, typewritten detailed explanation and authorization from the appropriate Dean or Vice President.

C.  RDF Procedure: RDF Form and Supporting Documentation

The RDF Form must be used to make any correction or change to the funding source of an individual employee for a prior pay period. As of March 1, 2007, departments should submit only the RDF Form to make such a change or correction to a prior period.

The RDF Form must be completed in its entirety and include the appropriate authorization. Any incomplete or inaccurate RDF Forms will be returned to the originating department.

The RDF Form must also be accompanied by the following additional documentation:

1.  Use the OBI Reporting HR/GL Detail report to submit a detailed report of all affected payroll charges for all pay period(s) involved in the RDF.

2.  Any other pertinent information that supports the redistribution

D.  RDF Procedure: RDF Form Submission and Routing

Step 1: Originating Department does the following:

• Completes the RDF Form to correct the prior period funding
• Attaches additional documentation
• Obtains appropriate authorization

Step 2: Sponsored Research Accounting Services (SRAS) reviews the RDF Form and documentation for authorized signature, funding information, performance period, and allowability. Note: This step is required only for submissions involving sponsored projects.

Step 3: Payroll Services (Payroll) processes the RDF in the OMNI HR system.

E.  RDF Procedure: RDF Processing Deadlines

For any RDF impacting a sponsored project, SRAS will review and approve/deny the RDF Form and within two (2) business days of receipt of the completed form and supporting documentation.

Payroll will review and process all RDF requests within ten (10) business days of receipt of the form.

Any incomplete or inaccurate RDF Form, including the appropriate supporting documentation, will be returned to the originating department. SRAS and Payroll will only process original forms with original signatures.

SPECIAL NOTE: Recommendation for Sponsored Projects: Use "Advance"

Departments that rely on sponsored projects for personnel funding are required to work closely with Sponsored Research Services on new and continuing awards. In many instances, departments must use an "Advance" for award funding and time so that personnel appointments may be made to the correct sponsored project funding source from inception. This will eliminate the need to process an RDF Form.

OP-D-2-E19 TAXES, ADJUSTMENTS AND RESPONSIBILITIES

A.  Withholding taxes, Social Security, Medicare and retirement expenditures, are dictated by an individuals tax status (US citizen, resident alien or nonresident alien), student status, position held and retirement code, and desires expressed when completing their W-4 form. This status is determined when the individual is entered into the payroll system and is the responsibility of Human Resources to monitor and ensure individuals are paying the appropriate taxes.

B.  When it is discovered that taxes have been either underpaid or overpaid, the following actions must be taken:

1.  Human Resources should be notified immediately to investigate the situation.

2.  If Human Resources determines that withholding taxes need to be adjusted, a new W-4 will be requested of the individual. Refunds of withholding tax will not be requested since the employee may claim a refund at year-end.

3.  If Human Resources determines that social security, Medicare, or retirement is involved, they will initiate a request for refund or collection to Payroll Services. This request will identify the individual, the problem, and the time period in which the problem occurred. Payroll Services will then do the following:

a.  Research and calculate any tax errors.

b.  If it is determined that the employee is due a refund, the appropriate accounts will be credited and a refund will be issued.

c.  If is determined that additional collections are due, the individual and any affected departments will be notified. The employee’s records will be adjusted and a payment will be posted to Accounts Receivable via the adjusting earnings code. Sufficient additional collections will then be withheld from the employee’s future wages.

OP-D-2-E20 TAXABLE FRINGE BENEFITS

A.  Taxable Fringe Benefits are those non-cash items provided an employee which increase taxable gross income and must have social security, Medicare and income tax deducted from them. Some of these items are as follows:

1.  Awards (such as savings bonds)

2.  Automobiles furnished to employees that are used personally

3.  Insurance policies and other fringe benefits provided employees that are not provided in cash

4.  Club memberships (The Club Usage Log (PR-04) may prove helpful when dealing with this type of benefit.)

5.  Spousal and family travel

6.  Tickets to sporting or other events

B.  Items of this nature must be monitored by departments and coordinated with Payroll Services in an expeditious manner to ensure timely inclusion in employee’s W-2 statements annually.

C.  Any specific questions about taxable fringe benefits (such as which benefits qualify, etc.) should be directed to Payroll Services.

OP-D-2-E21 INDEPENDENT CONTRACTORS & EMPLOYER-EMPLOYEE RELATIONSHIPS

The University processes expenditures for personal services of individuals and business entities through one of two methods -- employee appointments via the payroll system or contractual services via purchase orders or contracts. Guidance to departments in selecting between the two methods of acquiring personal services to ensure the appropriate treatment for tax purposes may be found in University Policy and Procedure OP-A-6. The Purchasing Department’s PowerPoint presentation on contractual services as well as the Independent Contractor/Contractual Services Checklist (PR-05) may also prove helpful in making these determinations.