| To: | Agency Directors, Fiscal Officers and Personnel/Payroll Officers |
| Subject: | Elimination of Earned Administrative Leave (EAL) Accruals |
| Sent Date: | 05/03/2007 |
State of Idaho
DIVISION OF FINANCIAL MANAGEMENT
Executive Office of the Governor
C.L. “BUTCH” OTTER 700 West Jefferson, Room 122
Governor P.O. Box 83720
BRADLEY T. FOLTMAN Boise, Idaho 83720-0032
Administrator (208) 334-3900
FAX (208) 334-2438
http://dfm.idaho.gov/
May 3, 2007
M E M O R A N D U M
TO: Attorney General Office, Military Division, Dept. of Correction, Correctional Industries, Dept. of Health and Welfare, Idaho State Police, Brand Inspector, Nursing Board, Outfitters and Guides, Lottery Commission
FROM: Brad Foltman, DFM Administrator
Judie Wright, DHR Acting Administrator
Brandon Woolf, DSP Administrator
SUBJECT: Elimination of Earned Administrative Leave (EAL) Accruals
The following IMPORTANT information affects your agency’s budget and payroll processing. This memo should be read thoroughly to ensure agency awareness. Please forward it on to those who may be affected.
Background on Earned Administrative Leave (EAL)
In 1981, fiscal shortfalls were causing employees to incur work that could not be paid until a later time. During these emergency conditions, the Idaho Personnel Commission provided a new category of timekeeping (EAL) that allowed the state to meet these emergency conditions. These conditions no longer exist and the utilization of EAL as a time keeping code by agencies has been inconsistently applied to address unintended aspects of work schedules.
Currently, no Idaho Code, Rule, or Statewide Policy exists that manages the balances and liabilities of EAL. In addition to new hours being accrued, the amount of EAL liability goes up with every increase in the employee’s hourly rate of pay from when the hours were accrued and when they are paid. Consequently, the state’s EAL balances and liabilities continue to climb and adversely impact the state’s financial position.
Example: Employee has a balance of 10 hours of EAL and has a current rate of pay of $11.00, the liability is $110.00. If the employee receives a merit increase to $12.00 per hour, the liability on the same balance of 10 hours of EAL increases to $120.00.
This liability needs to be addressed, and until such time as emergency conditions warrant a fresh review of this state application, EAL will be removed from the payroll system. This will result in state agencies needing to more closely monitor and manage both their employee’s work schedules and the agency’s budget.
Removal of EAL accrual process: When and what processes are affected?
Effective May 20, 2007 (June 15th pay date), Earned Administrative Leave will no longer be accrued. Having established that an employee may be owed more than 40 hours of compensation in a given week, the agency must recognize the potential for the fiscal impact this obligation may impose on an appointing authority’s budget.
The new DHR rule section 259 (Compensable Hours) states, “With the exception of holiday leave (HOL), no leave may be used if it will result in pay in excess of the employee’s regularly scheduled work week.”
Examples: Employee scheduled to work Monday through Friday, 8 hours per day.
Non-Holiday week: The employee takes Monday off as Vacation (or other form of paid leave), and then works 10 hours each day for the remaining four days. The time sheet would be coded as such: No hours recorded on Monday and 10 hours of actual hours worked (ACT) on each of the remaining four days. Resulting in pay for a total of 40 hours (REG) and no reduction in the employee’s vacation balance. Again, this example is applicable for all paid leaves.
Holiday week (Holiday on Monday): The employee does not work on the holiday, and then works 10 hours each day for the remaining four days. The time sheet would be coded as such: 8 hours of HOL on Monday and 10 hours of ACT on each of the remaining four days, resulting in pay for a total of 48 hours (8 HOL and 40 REG). In this example, it would be acceptable for the agency to adjust the employee’s work schedule and limit the number of hours worked per day to keep the employee’s pay to 40 hours. If your agency chooses this alternative during holiday weeks, it should be administered with consistency and equitably as possible.
Note: Employees with FLSA code of L (Law Enforcement) and F (Firefighter) accrue overtime only after 160 hours have been worked in a period of 28 consecutive days. EAL is currently being used to hold hours to be paid over 80 in the first 14 day cycle, then use them in the second 14 day cycle to make the employee’s paycheck whole (80 hours both cycles). This practice is used to provide the employee with consistency in pay within the 28 day period and will continue until further notice.
On Thursday, May 31, 2007, the following changes will be made:
Note: Because of the two week lag in payroll processing, some actions may be in the approval process (not ‘awaiting release’ status) on this date. Please ensure all IPOPS actions with an effective date of May 20, 2007 or later adhere to the following practices.
The State Controller’s Office will programmatically update the EAL accrual indicator on the personnel records of all employees, both classified and non-classified, to ‘N - Do not accrue’, unless the employee has a FLSA code equal to ‘L or F’.
IPOPS actions will not allow the EAL accrual indicator to be updated to ‘Y – Accrue’, unless the employee has a FLSA code equal to ‘L or F’.
The ‘EAL override’ on time transactions will no longer be accepted. Employees with FLSA codes equal to ‘L or F’ will accrue and/or be paid on a pay period basis. This is based on the EAL accrual indicator on the employee’s personnel record.
Will the remaining EAL balances be paid off and when?
The EAL balances that exist on May 20, 2007 will remain available for the employee’s use until June 14, 2008.
Note: These EAL balances may be paid off at any time. Agencies are strongly encouraged to promote the use of EAL taken and/or pay these balances off prior to FY 2009.
If balances still exist as of the first pay period in FY 2009 (begin date June 15, 2008 – pay date July 11, 2008) they will be programmatically paid off in the payroll process.
Note: It is necessary for agencies to prepare for these EAL pay offs in their Fiscal Year 2009 appropriation/budget.
If you have any questions regarding the information contained in this memorandum, please contact your DFM Analyst, DHR representative, and/or the DSP Helpdesk.
|