UNCLASSIFIED LEAVE PAYOUT FACT SESSION WEDNESDAY - SEPTEMBER 19
Unused Vacation at Termination Faculty, Academic Staff and Limited appointees are entitled to be paid for any unused vacation, floating holiday & ALRA upon termination from eligible UW-Madison employment. Supervisors, however, have the right to require the employee to use the vacation prior to termination (provided there is sufficient time to do so). If the employee is informed, in writing, that all or a portion of the vacation must be used prior to termination but the employee does not use the vacation, the employee cannot be paid for the unused vacation – it simply lapses.
Payment for unused vacation may be made as a lump sum or by extending the employee on the payroll – at the discretion of the department. Although either option may be used, the lump sum method is much simpler to calculate. When doing the calculations, work the equation straight through and round the end result. Round days and dollar amounts to two decimal places and hours to one decimal place. Payment of Unused Vacation
UCLU Screen V = use this to “view” the person’s leave for a specific appointment. Use Appt # F = use this to “forecast” leave payout. Use Appt# Enter the letter in this location & then enter the Appt #
This is what the screen would look like if you entered the letter V (view leave) and the PID# VN = vacation VC = vacation carryover SL = sick leave FH = floating holiday
This is what the screen would look like if you entered the letter “F” (forecast) and the PID# This is using an end date of 10/01/2007 VAC = vacation F Hol = floating holiday This person’s balance is 44.6 hours of VAC & 36 hours of F Hol. Total hours to be paid out = 80.6 Unclassified get new vacation and floating holiday allocations July 1
Calculating the Lump Payment Example 1: An employee earning $24,000 (monthly rate = $2,000) on an A (12 month) basis terminates with 88 hours of vacation. The person would be paid a lump sum of $1,000. [88/176 x $2,000 = $1,000] Example 2: An employee earning $25,782 (monthly rate = $2,148.50) on an A basis terminates with 131.8 hours of unused vacation. The person would be paid a lump sum of $1,608.93. [131.8/176 x $2,148.50 = $1,608.93] To determine the amount to be paid to the employee, divide the number of hours of unused vacation (including carryover) by 176, and multiply by the monthly rate of pay. Lump sum payments for vacation are excluded from retirement coverage.
Faculty, Academic Staff and Limited appointees are liable for ‘overuse’ of vacation upon termination. Although they may use anticipated vacation for the fiscal year, they must repay any negative actual balances upon termination. Once the end date is entered into the appointment system, any negative balances will be shown. Overused vacation is generally repaid by reducing the final paycheck. FLSA NOTE: Rules promulgated by the federal Department of Labor for government employees appear to allow the reduction of pay in increments of less than one day without jeopardizing the exempt status of those employees under the Fair Labor Standards Act. Therefore, the University may reduce the final paycheck in increments smaller than one day when an exempt employee overuses vacation. Overuse of Vacation Calculating the Repayment Upon Termination
Example 1: A full-time employee whose salary is $24,000 uses all 176 hours of vacation for the fiscal year by December 1 and then resigns effective December 31. From July 1 through December 31, he actually earned 88.2 hours of vacation. Thus, he overused vacation by 87.8 hours [88.2 earned – 176 used = -87.8]. Divide the number of hours overused by 176 and multiply by the monthly rate to determine how much needs to be repaid. He owes the University $997.73 [87.8/176 x $2,000 = $998] Example 2: A full-time employee whose salary is $30,000 uses all of her vacation carryover and 60 hours of the current fiscal year’s vacation before resigning on October 15. Using the Forecast screen on UCLA, we can tell that she would earn 51.2 hours of vacation from July 1 through October 15, and that she overused her vacation by 8.8 hours. Her final paycheck should be reduced by $125.00. [8.8/176 x $2,500 = $125.00] The amount of overpayment is calculated by dividing the number of hours of overused vacation by 176, and multiplying by the employee’s monthly salary rate.
Sick Leave Certification When an unclassified employee retires, the sick leave certification cannot be processed until after the 15th of the following month. That is after the credit cycle has been run and the sick leave credits granted. When a Madison Campus employee retires, UWPC completes the sick leave certification and updates the UCLA system. In the UCLA, the sick leave balance is removed and the message printed in history is "sick leave converted to health insurance." Therefore if a division/department views the UCLA system, and the sick leave balance for a recently retired employee is still on the "P" screen, they can assume the sick leave certification has not yet been completed. If there is no sick leave balance, and when viewing the "H" screen the message says, "sick leave converted to health insurance," then the sick leave certification has been completed and forwarded to ETF.
Reminders: Leave earnings are credited on the 15th of each month for the previous month. The payroll and appointment records must also be updated. If you process a Pay Data to pay out leave time PLEASE circle/highlight that funding string on the Pay Data so we know that is what you want paid. In the comments section in Pay Data also note that you are paying out xx hours of leave.