Policy
FIACCT 17-02_10 Labor Distribution – Excess/Comp Pool – Processing
Effective: July 1, 1994
Revised:
Purpose
This policy provides information concerning the flow of data for Excess/Comp pools.
Background
Two examples will be used to illustrate how information will be processed using the excess/comp pools. One example will be for an exempt employee and one for a non-exempt employee.
The examples assume the following:
Hours Worked | Total | Week 1 | Week 2 |
Regular Hours | 74 | 34 | |
Overtime Hrs. (Comp) | 10 | ||
Holiday Used | 8 | 8 | |
Comp Used | 4 | 4 | |
Total Hours Recorded on Emp. Timesheet | 96 | 46 | 50 |
Because the hours in Week 1 exceed 40 when leave was taken, 6 excess hours are the result (40 hour base, 36 hours worked).
Because the hours worked in Week 2 exceeded the 40 hour base by 10 hours, 10 overtime hours are the result (40 hour base, 50 hours worked).
The hours worked are charged to the following coding block.
Fund 100 | Agency 120 | Org 1038 | Appr Unit AAA | Rpt Cat PRS1 |
Hourly Wage and Departmental Benefit Rate:
Hourly Wage: $10 per hour.
Departmental Benefit Rate: 30%
Payroll Object Codes Used for the Examples:
5140 Comp/Excess Earned (Earned, FLSA non-exempt).
5199 Comp/Excess Earned (Benefit Rate Estimate).
5135 Comp Used.
Example 1 – Non-Exempt Employee:
This example uses the above information and assumes that the employee is non-exempt. The employee’s excess/comp amount is calculated from the overtime hours (10) and the excess hours earned (6).
The following calculations for excess and comp earned are performed in the Payroll System. These calculations can be seen below:
Excess Hours:
Excess hours earned: 6 * $10 = $60
Excess/comp benefit: 30% * $60 = $18
Comp Hours:
Comp hours earned: 10 * 1.5 * $10 = $150
1.5 is in the equation to calculate overtime at time and one-half.
Excess/comp benefit: 30% * $150 = $45
Total for Excess/Comp Pool:
Total excess/comp earned: $60 + $150 = $210
Total excess/comp benefit: $18 + $45 = $63
The following entries are posted against the agency budget from the 6 hours of excess earned and the 10 hours of overtime:
Amount | Fund | Agency | Org | Appr Unit | FINET Object | Rpt. Cat. |
$210.00 | 100 | 120 | 1038 | AAA | 5140 | PRS1 |
$63.00 | 100 | 120 | 1038 | AAA | 5199 | PRS1 |
When excess is earned it is recorded as an expense against the department budget. An offset entry is recorded in the excess/comp pool. The pool entry is not shown in this example.
In the example, the employee also used four hours of comp. When comp is used by a non-exempt employee it is recorded as a disbursement from the pool and does not affect the department’s budget. In this example $40, plus system-calculated benefits, would be debited to the pool using object 5135 (comp used), and the same amount credited to cash.
Example 2 – Exempt Employee:
This example uses the same data and assumes that the employee is exempt.
The following calculations for excess and comp earned are performed in the Payroll System. These calculations can be seen below:
Excess Hours:
Excess hours earned: 6 * $10 = $60
Excess/comp benefit: 30% * $60 = $18
Comp Hours:
Comp hours earned: 10
These hours are only recorded in the Payroll System. They become available for the employee to use as leave at a later date.
1.5 is not used in the equation because the employee is exempt.
Excess/comp benefit: When an exempt employee earns comp hours the cost is not posted to the excess/comp pool or to the department budget. Comp time for an exempt employee is only charged directly to a department budget when used.
Total for Excess/Comp Pool:
Total excess/comp earned: $60
Total excess/comp benefit: $18 + $0 = $18
The following entries are posted against the agency budget from the 6 hours of excess earned. There is no entry for the 10 hours of overtime:
Amount | Fund | Agency | Org | Appr Unit | FINET Object | Rpt. Cat. |
$60.00 | 100 | 120 | 1038 | AAA | 5140 | PRS1 |
$18.00 | 100 | 120 | 1038 | AAA | 5199 | PRS1 |
The examples show that excess hours, both earned and used, are handled the same for both exempt and non-exempt employees.
The examples also show that there is a difference between an exempt employee and a non-exempt employee concerning how comp time is handled. An exempt employee cannot vest comp time. In other words, comp time for an exempt employee cannot be carried over at the end of the overtime year. Due to this, comp hours are not posted to FINET when earned so the pool is not credited. When the comp time is used it is recorded as an expense against the department budget in FINET.
Summary:
The matrices below show the handling of excess/comp when earned and used for non-exempt and exempt employees.
Non-Exempt Employee
Excess | Comp | |
Earned | Excess hours are calculated by the Payroll System. Payroll costs consisting of excess hours and benefit additives are expensed to the department’s budget in FINET. Offset entry is written to the excess/comp pool to deposit excess payroll costs and benefit additive. | Comp hours are calculated by the Payroll System. Payroll costs consisting of comp hours and benefit additives are expensed to the department’s budget in FINET. Offset entry is written to the excess/comp pool to deposit excess payroll costs and benefit additive. |
Used | Excess payroll costs are disbursed from the pool. | Comp payroll costs are disbursed from the pool. |
Non-Exempt Employee
Excess | Comp | |
Earned | Excess hours are calculated by the Payroll System. Payroll costs consisting of excess hours and benefit additives are expensed to the department’s budget in FINET. Offset entry is written to the excess/comp pool to deposit excess payroll costs and benefit additive. | Comp hours are calculated by and posted only to the Payroll System. Costs are not recorded in FINET. |
Used | Excess payroll costs are disbursed from the pool. | Comp is recorded as wages and benefits against the department budget in FINET. |
The following summarizes the information in the above matrices.
Excess – Exempt and Non-Exempt Employees.
Earn – Distributed to FINET coding block.
Used – Paid from departmental pool.
Comp – Non-Exempt Employees
Earn – Distributed to FINET coding block.
Used – Paid from departmental pool.
Exempt Employees
Earn – Hours recorded on payroll but no transaction posted to FINET
Used – Distributed to department FINET coding block and budget.
Procedures
Responsibility
Action
For the processing of excess/comp when used and earned.
Departments
Enter payroll information into the Payroll System.
Division of Finance
Perform the proper calculations and post transactions to FINET based on the exempt/non-exempt status of the employee.