LCTCS CENTRALIZED PEOPLESOFT PAYROLL MEMORANDUM #

Transcription

1 LCTCS CENTRALIZED PEOPLESOFT PAYROLL MEMORANDUM # TO: FROM: All PeopleSoft Users Lura A. Kamiya LCTCS Human Resources Director DATE: April 22, 2004 RE: Workers Compensation Documentation Supercedes all prior workers compensation documentation Issue: When an employee is no longer actively working, but is approved for workers compensation this procedure documentation applies. At the point in time when the employee is no longer actively working, the annual and leave balances must be noted, as these are the balances that will apply to buy-back provisions while the employee is out on workers compensation. Compensatory leave is not considered in buy-back of leave as defined in statute, therefore, no workers compensation codes are established for compensatory leave used. Civil Service Rule states that the employee shall, to the extent of the amount accrued to his credit, be granted sick leave not to exceed the amount necessary to receive total payments for leave and workmen s compensation equal to his regular salary. In no case can the employee receive more than the total salary that would have been earned if he/she were not out on workers compensation. Civil Service Rule states, further, the employee may, to the extent of the amount accrued to his credit, be granted annual leave or a combination of annual and sick leave not to exceed the amount necessary to receive total payments for leave and workmen s compensation equal to his regular salary. In no case can the employee receive more than the total salary that would have been earned if he/she were not out on workers compensation. Because of the timing issues related to filing for Workers Compensation and actually receiving payments, an employee may have to use a full pay period of leave (typically 80 hours), assuming such leave balance is available to him/her, in order to receive a payment in the first period or two after filing. Once workers compensation payments are received, the employee is obligated to turn over his/her payment to the agency of employment, and in effect, buy back a certain number of hours of leave previously used, to the extent possible based on the dollar amount of the workers compensation check received. Therefore, it is necessary to assure that hours of leave balance used, from that available at the time of workers compensation begins, be tracked as workers compensation leave hours taken. Special earnings codes are established for this purpose and will be discussed later in this document. 1

2 These workers compensation leave hours utilized are required to be tracked and added back to the employee s balance, to the extent possible by the dollars available in the workers compensation check required to be turned in to the agency by the employee. Sick leave and annual leave accrual while out on workers compensation is eligible to be accrued only on the net hours used to supplement the workers compensation payment to the extent of the employee s full regular pay (the difference between what workers compensation pays the employee and what he/she would have earned if actively working). Since the employee was not at work while out on workers compensation (he/she is out on a workers compensation injury or illness), the hours were, in effect never used (they were bought back), and the employee is considered to be on leave without pay for those hours. Leave is not earned while an employee is in leave without pay status. For taxation purposes, the hours associated with buy back of leave are not subject to federal nor state income tax, since these buy-back hours actually represent the payment of workers compensation benefits to the employee (remember, they turned their check into you). Example: An employee earns $1500 per pay period ($1500/80 = $18.75 per hour) Employee has 250 hours of accumulated Sick Leave at the beginning of Pay Period 1 (for the example, assume there is no annual leave, although annual leave would be handled in the same way) Employee is in the 15+ years category for leave earning (7.384 hours per pay period. Earned Used Balance Pay Period #1 Earned Used Balance The employee is paid his regular salary and earns leave at the regular rate. Pay Period #2 Earned Used Balance The employee is injured on the job and is away from work for the entire period. He files for WC, but it takes a while to process his paperwork. He decides to use 80 hours of prior accumulated Sick Leave in order to continue being paid. Since he is using leave, he earns leave on the full number of hours used. Pay Period #3 Earned Used Balance The employee receives his WC Check for $1000, 2/3 of his 2

3 Regular salary. This is equivalent to 53.5 hours of of time. ($1000/$18.75 per hours = 53.5 hours of leave to be bought back. 1. He turns this check in to the agency and is credited in his (previous leave balance for this number balance + of hours. He has bought back 53.5) 53.5 hours of leave to be bought back and applied to balance by using the hours tracking code) 2. He continues to record hours of Sick Leave used and is ( paid his full salary. He will buy 80.0) back some of these hours with his next check. * 3. He earns leave only on the difference between the hours ( = 26.5) ( used this period and the hours (26.5 x ) bought back this period. Since, per hour = in effect, the 53.5 hours were 2.446) never used and the employee was not at work during those hours, he is in leave without pay status for those hours and cannot earn leave while in leave without pay status. Pay Period #4 Earned Used Balance The above process repeats itself each pay period. Eventually, the employee will exhaust his accumulated leave balances and will at that time cease turning in his check to the agency and will revert to a full leave without pay status. He will no longer receive a payment from the agency or earn leave until he returns to work. *To determine the amount of leave hours that can be bought back, take the gross amount of the workers comp check and divide by the hourly rate in effect at the current time Ex: $1000 gross WC check/$18.75 per hour = 53.5 hours of leave that he/she can buy back. When the employee goes out on workers compensation, you must notify the employee who the institution s designated person is for receipt of workers compensation checks that are required to be turned in to the agency. 3

4 In the event that the employee turns the physical workers compensation check over to you in human resources, this check must be turned over to the institution s designated person in the finance/accounting department so that the appropriate accounting entries may be made. PeopleSoft Earnings Codes for Workers Compensation As indicated previously, the workers compensation check may take time reach the employee, and it may be necessary to allow the employee to utilize previously earned leave. At this time you will code the leave utilizing the regular leave taken codes of either SLT (sick leave taken), FST (faculty sick leave taken), and ANL (annual leave taken). You will need to use the companion workers compensation leave tracking code to keep a running balance of leave hours taken while on workers compensation. Sick Leave SLT WSB WSH Use this code during the initial period of workers compensation when the employee is electing to use prior leave balance because no workers compensation check has been received. You must use together with WSB to track these hours as leave hours taken while out on workers compensation. You will also use this code for the hours of leave each pay period needed to provide full pay to the employee that is not represented by the buy back code and on which leave accrual is eligible (the 26.5 hours represented in the example shown above.) Workers Compensation Sick Leave Hours Tracking This code must be recorded as negative hours. This code tracks the hours of sick leave used while out on workers compensation and adds these hours back to the balance. This code serves a dual purpose of tracking hours and adjusting balance. Workers Compensation Sick Leave Buy Back This code pays the hours as sick leave, rather than regular hours and subtracts the hours from the balance. Faculty Sick Leave FST Use this code during the initial period of workers compensation when the employee is electing to use prior leave balance because no workers compensation check has been received. You must use together with WFB to track these hours as leave hours taken while out on workers compensation. You will also use this code for the hours of leave each pay period needed to provide full pay to the employee that is not represented by the buy back code and on which leave accrual is eligible (the 26.5 hours represented in the example shown above.) WFB Workers Compensation Faculty Sick Leave Hours Tracking This code must be recorded as negative hours. This code tracks the hours of faculty sick leave used while out on workers compensation and adds these hours back to the balance. This code serves a dual purpose of tracking hours and adjusting balance. WFH Workers Compensation Faculty Sick Leave Buy Back This code pays the hours as faculty sick leave, rather than regular hours and subtracts the hours from the balance. 4

5 Annual Leave ANL Use this code during the initial period of workers compensation when the employee is electing to use prior leave balance because no workers compensation check has been received. You must use together with WAB to track these hours as leave hours taken while out on workers compensation. You will also use this code for the hours of leave each pay period needed to provide full pay to the employee that is not represented by the buy back code and on which leave accrual is eligible (the 26.5 hours represented in the example shown above.) WAB Workers Compensation Annual Leave Hours Tracking This code must be recorded as negative hours. This code tracks the hours of annual leave used while out on workers compensation and adds these hours back to the balance. This code serves a dual purpose of tracking hours and adjusting balance WAH Workers Compensation Annual Leave Buy Back This code pays the hours as annual leave, rather than regular hours and subtracts the hours from the balance. No Pay/Leave Without Pay WCN Workers Compensation No Pay This code tracks the number of hours of leave without pay while out on workers comp and subtracts these hours from regular pay to record no pay for these hours. Retirement Considerations TRSL TRSL requires the employer to notify TRSL when a member begins receiving workers compensation and provide the date of the injury. At the beginning of each fiscal year, the employer must provide a list of all members who will continue receiving workers compensation benefits. The member has the option of paying employee contributions on a salary not to exceed the greater of the workers compensation benefits being received or the salary at the time of qualification for workers compensation. The employer pays the employer portion on the actual amount on which the employee contributes. If the member pays employee contributions on an amount which is less than the full-time rate at the time of qualification, service credit will be prorated. PeopleSoft workers comp buy back codes automatically consider the wages earned as a result of these codes as pensionable earnings and both employee and employer pension contributions will be taken from these earnings. LASERS LASERS will use any time period after September 1, 1989, during which an employee collected workers compensation benefits, was employed in state service, and did not receive normal service credit, to determine eligibility for 5

6 retirement. LASERS does not use this service credit when computing the members retirement benefit. The agency must notify LASERS of any period of time an employee is receiving workers compensation. Members should speak to LASERS for periods of workers compensation prior to 9/1/89. PeopleSoft workers comp buy back codes automatically consider the wages earned as a result of these codes as pensionable earnings and both employee and employer pension contributions will be taken from these earnings. Additional questions regarding workers compensation and retirement benefits should be directed to the retirement system. 6