FIACCT 11-21_00 Payroll – Use of Pre-2006 Sick and Converted Sick Leave Balances

Effective: April 3, 2006
Revised: March 21, 2011

Purpose

This policy describes procedures to allow employees to use their “Pre-2006” (Program I) unused sick and/or converted sick leave balances as paid leave. These leave balances can be either used as paid leave during employment or used to acquire additional benefits during retirement. (See Background section below)

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Background

In 2005, the Legislature passed House Bill 213 to change the benefits associated with unused sick and converted sick leave. In short, the bill specifies that, upon retirement, unused sick/converted sick leave accrued before 2006 (Program I) can be used in exchange for health insurance on the basis of eight hours of leave for one month coverage. Unused sick/converted sick leave accrued after 2005 (Program II) can be used to reimburse health care costs on a dollar for dollar basis. Since the value of the Program I leave balances is significantly different than the value of the Program II leave balances, it is important that the pre-2006 sick/converted sick leave balances are properly accounted and safeguarded. For this reason, departments and employees must strictly adhere to these policies and procedures.

Beginning January 1, 2011, employees participating in the Unused Sick Leave Retirement Program I under Section 67-19-14.2 may make a one-time and irrevocable election to transfer all unused (Program I) sick leave hours which shall include all (Program I) converted sick leave hours under Section 67-19.14.1 to their (Program II) accounts, for use under the Unused Sick Leave Retirement Program II. Program II may have more value to some employees than Program I. For employees that do not need the health insurance benefits offered by Program I, the Health Reimbursement Arrangement (HRA) money in Program II may be more beneficial. Employees age 65 or older may find that the HRA money is more valuable than the Medicare Supplement benefit. Employees should carefully consider which option is best for them.

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Policy

A. At the end of the 2005 leave year, State Payroll banked all employees’ unused (Program I) sick and converted sick leave balances. These balances shall be maintained in the Payroll System and may be viewed by employees on the standard leave balances reports, and in the Employee Self Service System. They are labeled: “Pre-2006 Sick” and “Pre-2006 Converted Sick”.

B. Employees may make a portion of the banked pre-2006 (Program I) sick and/or converted sick leave
available for paid absences by completing the Authorization to Make Program I (Pre-2006) Sick and/or Converted Sick Leave Available for Paid Absences form. The form is also available at the end of this policy. The employee must complete and sign the authorization form before the banked leave will be made available for use as paid leave. Departments must maintain the authorization form(s) as part of the employee’s personnel file. Employees cannot use the “Authorization” process to move their Program I leave hours to their Program II leave balances in excess of what they will actually use as paid leave. The employee and department payroll/personnel staff are responsible to ensure that Program I leave is not moved to Program II and then left unused or is treated as Program II leave upon retirement. Departments shall run the ‘Pre-2006 Hours Moved Not Used’ report and restore any unused Program II leave into the Program I account for all employees prior to leave year end processing each year, as well as prior to processing a termination and/or retirement action for an employee.

C. Beginning January 1, 2011, or any time after, employees may make a one-time and irrevocable election to transfer all Program I sick and converted sick leave from Program I to Program II by completing the One-Time and Irrevocable Authorization to Transfer All Program I (Pre-2006) Sick and Converted Sick Leave Hours to Program II form. The form is also available at the end of this policy. The employee must complete and sign the form before the banked leave will be moved to the Program II account. Departments must maintain the authorization form(s) as part of the employee’s personnel file and give copies to the employee and State Payroll as indicated on the form.

D. Leave that is automatically available for use as paid leave is termed “Current” balance. Program II leave hours accrue as “Current” sick and converted sick leave. If an employee has authorized use of their banked (Program I) leave as paid leave, the “Current” balances must be increased as described in the Procedures section of this policy. Department payroll/personnel staff shall use the same effective date when making quota correction entries.

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Procedures

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Authorization to Make Program I (Pre-2006) Sick and/or
Converted Sick Leave Balances Available for Paid Absences

I __________________________________________, elect to use some or all of my unused pre-2006
Sick or Converted Sick leave balance(s) for paid absences as enumerated below:

Amount of Pre-2006 Sick leave to be made available for paid Sick absences:_________

Amount of Pre-2006 Converted Sick leave to be made available for paid Conv Sick absences:_________

The availability of the above-designated leave is effective for the pay period beginning:______________

I have reviewed the Division of Finance Policy FIACCT: 11-21.00 ‘Use of Pre-2006 Sick and Converted Sick Leave Balances’ and understand that the pre-2006 sick/converted sick leave made available for use must be used before I retire or terminate, or prior to the end of the current leave year, whichever comes first. Furthermore, any unused pre-2006 sick/converted sick leave will be added back to my pre-2006 sick/converted sick leave balance before I retire or terminate, or prior to the end of the current leave year, whichever comes first.

Employee Signature:____________________________________ EIN:___________ Date:___________

HR/Payroll Representative Signature:______________________________________ Date:___________

Department HR/Payroll Staff shall:
… Move and account for the leave in accordance with Finance Policy FIACCT: 11-21.00
… Give a copy to the employee
… Place this original document in the employee’s permanent personnel file

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One-Time and Irrevocable Authorization to Transfer All Program I
(Pre-2006) Sick and Converted Sick Leave Hours to Program II

As of January 1, 2011, an employee who is participating in the Unused Sick Leave Retirement Program I
under Section 67-19-14.2 (Utah Code Annotated 1953), may make a one-time and irrevocable election to
transfer all unused sick leave hours which shall include all converted sick leave hours under Section 67-
19.14.1 (Utah Code Annotated 1953), for use under the Unused Sick Leave Retirement Program II.

I __________________________________________, elect to transfer all of my unused Program I sick
and converted sick hours into Program II to be effective in the pay period beginning:______________

Unused balance of Pre-2006 Sick leave hours (to be moved to Program II Sick):_______________

Unused balance of Pre-2006 Converted Sick leave hours (to be moved to Program II Converted
Sick):_______________

I have reviewed the Division of Finance Policy FIACCT: 11-21.00 ‘Use of Pre-2006 Sick and Converted Sick Leave Balances’ and understand that this is a one-time and irrevocable election to transfer all unused Program I sick leave hours which shall include all unused converted sick leave hours into Program II hours.

Employee Signature:____________________________________ EIN:___________ Date:___________

HR/Payroll Representative Signature:______________________________________ Date:___________

Department HR/Payroll Staff shall:
… Move the leave in accordance with Finance Policy FIACCT: 11-21.00
… Give a copy to the employee
… Submit a copy to the Pam Borman in the Division of Finance/State Payroll (Fax: 801-538-3244)
… Place this original document in the employee’s permanent personnel file