Welcome to the Earnings Code Training for Legacy UMDNJ positions

Welcome to the Earnings Code Training for Legacy UMDNJ positions This training provides the basics that are essential for proper Earnings Code pay ad...
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Welcome to the Earnings Code Training for Legacy UMDNJ positions

This training provides the basics that are essential for proper Earnings Code pay administration. You will become familiar with administrative guidelines and procedures for Earnings Code payments. General Earnings Code descriptions and information are provided to ensure proper pay administration and payment of wages by Management and Department Timekeepers.

Prepared by Compensation Services “Our goal is to provide you with excellent customer service to meet the needs of your organization.” 1

Table of Contents Background

Page 3

Objectives

Page 4

Accountability

Page 5

Identifying Roles

Page 6

Why are Earnings Codes Established?

Page 7

Compensation Regulations

Page 9

Base Pay

Page 10

Fair Labor Standards Act (FLSA)

Page 11

Shift Differential

Page 14

Pensionable Earnings

Page 16

Earnings Code Process

Page 17

Earnings Code Table Overview

Page 19

The University-wide Earnings Code Table

Page 21

Timesheet Examples

Page 35

Conclusion

Page 37

Background •

Human Resources Compensation Services Payroll Departments collaborated to develop a comprehensive online training program for staff who enter this information on timesheets.



Human Resources Compensation Services Office conducted a Earnings Code Survey which included all operating units and obtained data from management and supervisors on: – frequency of use – problems in identifying which earnings codes to use – reference tool preferences – training needs.



Vital information for this project was researched and validated. As a result, inactive Earnings Codes were deleted and additional Earnings Codes were created that were essential.



The results of the survey were used to develop our training to clearly document pay practices, diagnose usage problems, and ensure data integrity so that Management and Department Timekeepers could make informed decisions.

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Human Resources/Payroll Earnings Code Training

Objectives: •

Provide the pay policy guidelines and procedures for managing established Earnings Code Compensation



Define Earnings Code pay eligibility



Define proper usage of Earnings Codes



Prevent misuse of Earnings Codes



Ensure compliance with FLSA regulations and union contracts



Capture information needed for an automated time and attendance system

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Human Resources/Payroll Earnings Code Training

Accountability: •

Both Management and Department Timekeepers must be stewards over the budgets they monitor



Earnings Code transactions must be accurate to appropriately reflect the actual calculation and payout



Earnings Codes must be monitored by departments for accounting, budgeting, and compliance purposes and to audit and track expenditures

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Human Resources/Payroll Earnings Code Training

Identifying Roles: •

The Human Resources Compensation Services Office Establishes policies and practices which enhance our ability to maintain competitive pay levels in the industries in which we compete for similar positions.



The Department of Payroll Maintains the central employment records that show the hours worked, gross wages, taxes, deductions and net wages for each employee. Earnings Codes are a way of distinguishing the payments made to employees.

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Why are Earnings Codes Established? •

For the business needs of operating units.



To identify costs for premium overtime pay and additional compensation that is established for a specific time period the work is performed or for a specific work assignment.



To identify work performed outside of the regular daytime or standard workweek work schedules which command extra pay in the markets in which we compete (i.e. evening/night shifts, per diem work, etc.).



For special pay practices that compensate non-exempt, hourly employees for work hours that are hard to recruit for, unique work schedules or special assignments (i.e. charge pay).



Earnings Codes are established for on-call pay given to employees who are off site and must respond to work-related assignments for a scheduled on-call period.

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Why Are Earnings Codes Established? •

Our organization has multiple pay structures within our over-all salary program as you will see on the Human Resources Earnings Code Table to follow.



Earnings Codes systematically separate types of payments for accounting, cost analysis and budgeting purposes.



Different groupings of positions such as nurses, technical, clerical, support, and professional personnel reflect different compensation levels due to supply and demand in the market. Payments may be given to employees who are scheduled to be on-call in accordance with the business needs of the operating unit.

• •

Many of our Earnings Codes are used primarily in operating units with 24/7 operations.



There are limited instances when additional pay is provided to exempt employees.

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Compensation Regulations We will now provide an overview of regulations that impact Compensation for non-exempt and exempt employees. • • • •

Base Pay Fair Labor Standards Act Shift Differentials Pensionable Earnings

These regulations are taken into account when earnings code pay practices are developed.

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Base Pay Base pay is regular wages or salary without overtime, shift differential, or other remuneration. There are other established pay rates that are part of an employee’s total compensation. Non-Exempt Base pay is the regular hourly rate paid to a non-exempt employee. Exempt For exempt employees, base pay is a pre-determined, fixed salary amount.

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Fair Labor Standards Act (FLSA) Wages include all amounts due for labor or services performed by an employee. Wages may be fixed or determined by time, job or other methods. The Fair Labor Standards Act (FLSA) is a Federal law governing: ● minimum wage, ● overtime pay, ● equality in pay, ● child labor, ● and recordkeeping. FLSA regulations must be followed when calculating pay for nonexempt employees.

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Fair Labor Standards Act (FLSA) Please note that: Non-exempt (hourly) employees are covered by the overtime pay provisions of the Fair Labor Standards Act (FLSA) and must be paid for all hours worked. By law, non-exempt employees are paid time-and-a-half for all hours worked in excess of 40 per week. Since we are a public employer, compensatory time at time-and-ahalf may also be given to non-exempt employees in lieu of overtime pay. Sick time hours are exempt from the overtime calculation.

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Fair Labor Standards Act (FLSA) The Fair Labor Standards Act (FLSA), also known as the Wage and Hour Law has implications for Payroll that must be taken into account, such as paychecks, overtime pay, withholding allowances, taxes, payment practices, and recordkeeping. Most differentials such as shift differential, float differential, and charge pay are included in the calculation of premium overtime. These are all taken into account when Payroll processes Earnings Code transactions.

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Shift Differential Guidelines Eligible staff employees in Legacy UMDNJ positions who are formally assigned to work the evening and night shifts are provided with shift differential pay. A job classification’s eligibility or ineligibility for shift differential will be determined by the Human Resources Compensation Services Office at the time the job is established. Shift differentials are based upon market practices, FLSA (Fair Labor Standards Act) status, contractual obligations and other appropriate considerations. It is only provided to employees scheduled to work on these shifts in accordance with policy.

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Shift Differential Guidelines The controlling factor for entitlement to shift differential compensation is the time the work is performed and the amount of hours worked during that period.

• If an employee who is in a position eligible for shift differential pay works at least half of his/her work hours (excluding overtime) between 3 PM and 6 AM, the shift differential must be paid for the entire shift.

• If the employee works less than half of his/her shift (excluding overtime) between 3 PM and 6 AM, no shift differential will be paid. Policy: 30-01-30-80:00

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Pensionable Earnings

Pensionable Earnings are earnings subject to pension and group life insurance contributions for retirement and death benefits which are calculated on the employee’s salary and do not include extra compensation as defined in the state pension regulations. Please note: Additional earnings are regarded as extra compensation and not subject to pension and group life insurance contributions. These include, but are not limited to; overtime, straight time overtime, on-call hours, call-in hours, out-of-title, shift differential or lump sum payments.

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Earnings Code Process • Most of our Earnings Codes are manually recorded on the employee’s timesheet. • There are some Earnings Codes which are for “Payroll Use Only” that you will not need to use. They will not appear on the timesheet but will appear on the paycheck and on the employee self service site (i.e. tuition reimbursement, out-of-title pay and additional compensation).

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Earnings Code Process •

Non-exempt employees’ hours should be filled in on the timesheet completely totaling up to their total workweek hours. All regular hours worked, straight time overtime hours, overtime hours worked after 40, differentials and leave time, etc. should be recorded with the correct Earnings Code. Refer to our timesheet examples that follow.



Exempt employees do not fill in daily hours worked on the timesheet.



Exempt employees should only record appropriate benefit leave time (vacation, sick, etc.) in the appropriate day of that pay period.



Please refer to the various Human Resources Policies for entitlement for sick time, vacation, bereavement, and float holiday pay to ensure an employee is eligible to receive payment.



Please note: Bereavement pay is taken from the sick leave benefit time utilizing Earnings Code 040 in accordance with Policy (30-01-40-15:00).



Use Earnings Code 950 or 955 for Worker’s Compensation time reporting, which must be verified and approved by Risk and Claims prior to payment. 18

The Timesheet & Human Resources Earnings Code Tables We will now provide an overview of the Timesheet and Human Resources Earnings Code Tables. Used properly, these tools will help to prevent misuse of Earnings Codes.

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It is important to know that there are three components that make up our Master Earnings Code Table in BANNER:



The Timesheet Earnings Codes encompassing general pay transactions for all employees.



The Human Resources Earnings Codes which focus on eligibility for payment and apply to the specific job category and special pay practices. These Earnings Codes are entered on the employee’s timesheet.



Payroll Use Only Earnings Codes that are used by Payroll staff.

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The Timesheet Earnings Code Table The Legacy UMDNJ Code Table for Staff positions illustrated below is a listing of the Earnings Codes. Use this as a reference tool when completing your department’s timesheets. Earnings Code

Short Name

Long Name

Amount

FLSA Status

Union

Description

The table is comprised of seven columns which show: • The Earnings Code to be put on the timesheets • The Short Name coded in BANNER • The Long Name coded in BANNER • The compensation Amount that is associated with each code • The Fair Labor Standards Act (FLSA) Status for which the code applies • The Union the code falls under • The intended purpose of each pay practice in the description.

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The Timesheet Earnings Code Table On the next slide: •

Under Earnings Code, 001 is used for Regular Pay. This is the code that should be recorded on the timesheet.



The Short Name column shows the abbreviated name of the 001 Code which is found on the employees’ pay stub.



The Long Name column, describes the full description in BANNER.

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The Timesheet Earnings Code Table Earnings Code

Short Name

Long Name

Earnings Codes for Timesheet Use

Earnings Code 001 002 005 014 026

Amount

FLSA Status

Union

Description

Short Name REG PAY JURY DTY UN ACTVS COMPTIME SICK PAY

Long Name Regular Pay Jury Duty Pay Union Activities-Regular Comp Time Taken Sick Pay

040

BEREAVE

Bereavement Pay

045 051 061

SCH_SICK VACATION STOT

Scheduled Sick Pay Vacation Time Straight Time Overtime

101 105

HOLIDAY FLOATHOL

Holiday Pay Float Holiday Pay

106 110 120 122 127 128 180

HOLIDAY OVERTIME OVT CALL HOL PREM W eather W eather CONFERNC

Holiday Pay Non-Premium GF/TD Overtime Call-In Overtime Holiday Premium Pay Non-Essent'l Inclement/weather Essential Inclement W eather Conference/Class/Seminar

950

W ORKRCMP

W orker's Compensation Hours

955

SICK/W C

Sick/Worker's Comp-Police

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The Timesheet Earnings Code Table On the next slide, the Amount, FLSA Status, and Union Columns are shown. •

Some of these fields are not applicable because there is no corresponding dollar amount designated for the code.



For example, Regular Pay is associated with all employees in Legacy UMDNJ positions and will be different for each employee.

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The Timesheet Earnings Code Table Earnings Code

Short Name

Long Name

Amount

FLSA Status

University-wide Codes for Timesheet Use

Earnings Code 001 002 005 014 026

Union

Description

Amount NA NA NA NA NA

FLSA Status NA NA NA NA NA

Union NA NA NA NA NA

040

NA

NA

NA

045 051 061

NA NA NA

NA NA Non-Exempt

NA NA NA

101 105

NA NA

NA NA

106 110 120 122 127 128 180

NA NA NA NA NA NA NA 70% of base pay 100% of base pay

Non-Exempt Non-Exempt Non-Exempt Non-Exempt NA NA NA

NA NA HPAE Nurses, HPAE Prof, CW A & Teamsters NA NA NA NA NA NA

NA

NA

950 955

Non-Exempt

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The Timesheet Earnings Code Table In the following slide, the Description Column provides a detailed explanation of the Earnings Code pay practice which allows you to understand the intended purpose for each code.

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The Timesheet Earnings Code Table Earnings Code

Short Name

Long Name

Amount

FLSA Status

Union

Description

Earnings Codes for Timesheet Use Earnings Code 001 002 005 014 026

101 105

Description Compensation for regular earnings reported by employees Time served for jury duty; 100% of salary Labor Relations approved union conferences, seminars, etc Hours paid for compensatory time used Used to report time eligible employees who are excused from work with pay for illness Used to report time eligible employees who are excused from work with pay for a death in the family Used to report pre-approved time eligible employees who are excused from work with pay for illness Used to report time eligible employees who are off from work with pay for vacation Hours between base hours and 40 hours Used to report time eligible employees who are off from work with pay for University recognized holidays Used to report time eligible employees who are off from work with pay for float holidays

106 110 120 122 127 128 180

Used for scheduled hours worked for Good Friday and the day after Thanksgiving, for nonpremium holiday pay, counts towards 40 hr workweek Hours paid at time and a half over 40 hours On-call, hours put employee above 40 hours. Time + 1/2 for 4 hours Applies to all employees, except eligible 12 hour shift employees under Earnings Code 107 Hours worked by non-essential staff on days the University is closed due to inclement weather Hours worked by essential staff on days the University is closed due to inclement weather Hours paid for attending a conference, class or seminar

950

Staff excluding Police and Sergeant - 70% salary for Workers Comp sick leave injury

955

Used to pay Police Officers and Sergeants on Workers Comp sick leave injury

040 045 051 061

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The Timesheet Earnings Code Table Some frequently used Legacy UMDNJ Earnings Codes are pre-printed on the timesheets, such as Regular Pay and Sick Pay. For these instances, you only need to record the actual hours applicable for that code. All extra hours should be recorded under 061 straight time overtime, or 110 overtime, hours over 40. Codes that are not pre-existing on the timesheet will have to be manually recorded, along with the applicable hours for that code. Exempt employees will have “X’s” marked for all fields where you would record the hours and the associated code. In the event of, for example, a sick or vacation day, it should be recorded on the day that the time was used in order to correctly note leave time taken. An exempt employee’s sick, vacation, or float holidays may be reported as a partial day, i.e. ½ day (S) for Sick or in hours, i.e. 2 hours (FH) for Float Holiday. A non-exempt employee, however, must have his/her hours reflected along with the code.

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The Earnings Code Table This is a management tool used across the University that complements the Earnings Code Training. The Human Resources Earnings Code Table depicts pay rates that reflect pay practices and costs associated with employment.

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The Human Resources Earnings Code Table • The Human Resources Earnings Code Table has been organized by Job Type/Bargaining Unit Category. • Each Earnings Code pay practice is listed on the Human Resources Earnings Code Table. • The table is comprised of columns indicating the: • Earnings Code numbers, placed on the employee’s timesheet • Short and Long Names in Banner • Compensation Amount • FLSA Status • Union • Description. International Union of Operating Engineers Local 68 Earnings Code Short Name Long Name Amount FLSA Status Shift Diff 139 SHF LO68 Local 68 $2.00/hr Non-Exempt

Union Operating Engineers

Description Differential paid for Evening/Night shift

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The Human Resources Earnings Code Table • The description on this table describes the pay practice, provides job title eligibility and a capsule explanation for applying payments. Please refer to the Union contract links found on the UHR website for detailed information. http://uhr.rutgers.edu/policies-resources/collectivenegotiations-agreements • If an Earnings Code applies to more than one union, it is specified in the Union Column. • The correct Earnings Code number and employee’s hours should be recorded on his/her timesheet.

Teamsters Local 97 Earnings Code Short Name Long Name Amount FLSA Status Shift Diff 154 SHF DIFF Local 97 $2.00/hr Non-Exempt

Union Teamsters

Description Differential paid for Evening/Night shift

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The Human Resources Earnings Code Table The Union Column identifies specific Earnings Codes, which are grouped together by Bargaining Unit. Within each group, the codes that are non-job title specific are listed first, followed by the codes that are specific to one job title/pay practice. You can see that the table is comprised of the same columns used in the Timesheet Earnings Code Table. However, this table illustrates a detailed explanation of the pay practices for applying payments to specific job titles.

Health Professionals and Allied Employees - HPAE Local 5089 (Registered Nurses) Earnings Code Short Name Long Name Staff Nurse 163 Shift shift diff

Amount

FLSA Status

$3.50/hr

Non-Exempt

Union HPAE Nurses

Description Evening/Night shift differential for Staff Nurses

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The Human Resources Earnings Code Table For example, your department has a Staff Nurse who is scheduled to work weekend hours: The Staff Nurse title is an HPAE Nursing title, so you would first look for that Category on the table. Then refer to column three, the Long Name Column, and search for the Staff Nurse specific codes.

Health Professionals and Allied Employees - HPAE Local 5089 (Registered Nurses) Earnings Code Short Name Long Name Staff Nurse 169 WKENDDIF Wkend diff

Amount

FLSA Status

$1.50/hr

Non-Exempt

Union HPAE Nurses

Description Weekend shift differential for Staff Nurses

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The Human Resources Earnings Code Table You will see that Code 169 is used for payment of the Staff Nurse Weekend Differential rate, which is outlined in the Amount Column. Before recording the Code on the timesheet, read the Description column to ensure the Code is being used for its intended purpose. In this example, you would record the 169 Code on the timesheet with the number of weekend hours that were actually worked. This would supplement the number of hours that were recorded under regular pay, Code 001. Payroll will data enter the code and hours based on what is recorded. This will generate the Weekend Shift Differential pay. Health Professionals and Allied Employees - HPAE Local 5089 (Registered Nurses) Earnings Code Short Name Long Name Amount FLSA Status Union 169 WKENDDIF Staff Nurse $1.50/hr Non-Exempt HPAE Wkend diff Nurses

Description Weekend shift differential for Staff Nurses

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The Human Resources Earnings Code Table Please refer to the following Staff Nurse timesheet example for a two week pay period, coded with Regular Pay (001), Weekend Staff Nurse Shift Differential (169), and Overtime Hours in excess of 40 (110). # of Hours at Regular Pay for Wk 1

Regular Pay for Wk 1

# of Overtime Hours after 40 Worked for Wk 1

Employee Worked 9 Hours on Saturday in Wk 1 and Will Be Paid Weekend Shift Differential

Employee Worked 5 Overtime Hours in Wk 2

Regular Pay for Wk 2

Total Hours are Actual Hours Worked (not lunch) Employee Enters Own Hours Each Day

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The Human Resources Earnings Code Table The following is an example of a standard timesheet for a non-exempt employee for a two week pay period which indicates Regular Hours (001), Straight Time Overtime (061), and Overtime Hours in excess of 40 (110). # of Overtime Hours After 40 Worked for Wk 1

Regular Pay Only Includes Regular Hours

Straight Time Overtime Up To 40 Hours for Wk 1 Indicate # of Hours of Sick Time Used

Employee Called in Sick

Still Indicate # of Hours for Scheduled Day

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This concludes our online training. You may replay the presentation or sections of it as needed. Individual Training Sessions will be scheduled for high-use areas and as requested to provide the opportunity for us to answer your questions. If you want to request a Session, please contact:

Transforming the Delivery of Human Resources April 2013

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