Labor Distribution
Policy
FIACCT 17-03_12 Labor Distribution – Termination Pool – Retirement
Effective: July 1, 1994
Revised: April 7, 2003
Purpose
This policy provides information concerning payments to individuals which are charged to the Termination Leave pool when a state employee retires.
Background
When an employee retires from employment with the State, certain costs associated with that retirement are automatically charged to the Termination Leave pool. These charges are vested annual leave, vested converted sick leave, 25 percent of sick leave cashout, retirement health insurance premiums, and life insurance premiums.
For further information concerning the retirement of employees see the PAYROLL section of this manual.
Example:
Employee A has worked for the State for thirty years. Each payroll cycle, for employee A and all other employees in the “Rest of State Government” pool, termination leave additives are posted to the pool.
Employee A has retired. Vested annual leave, vested converted sick leave, 25% of sick leave cashout, retirement health insurance premiums, and life insurance premiums for employee A will be charged to the “Rest of State Government” pool.
Procedures
Responsibility
Action
For posting charges to the Termination Leave pool when an individual retires.
Departments
Enter the termination in the personnel system, HR Enterprise.
Division of Finance
Calculate payroll information and post the transactions to FINET.
Department
Receive the annual billing from Group Insurance for the retiree’s health insurance premiums and life insurance premiums. Review the billing to insure it is correct, and sign the billing to authorize Finance to pay.
Forward the approved invoice to Finance for payment.
Division of Finance
Approve, and process the payment voucher to pay out premiums from the Termination Pool.