Payroll Calculation Self-Guided

8/7/2019 Payroll Calculation Self-Guided

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Payroll Calculation

Created by:

Idaho State Controller's Office,

Division of Statewide Payroll


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Payroll Calculation

Agenda Payroll Calculation Defined

Fair Labor Standards Act (FLSA)

Time Codes Automatic Overtime Calculation


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Payroll Calculation

Defined Payroll calculation is the method is which

employees are compensated for their time.

Although these calculations are automaticallyprocessed within our payroll systems, it isimportant to understand the calculation so you areable to explain it to your employees withconfidence.


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Payroll Calculation

Definitions Holiday: A paid day of which an employee who

qualifies for state retirement benefits is exemptfrom work.

Holiday Overtime: All hours worked on a holiday. Overtime: Actual time worked in excess of 40

hours within a work week. Leave Taken: All paid and unpaid leave. Hours Worked: Hours worked performing job.


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Payroll Calculation

Fair Labor Standards Act (FLSA)

The Fair Labor Standards Act (FLSA) establishesminimum wage, overtime pay, recordkeeping andchild labor standards affecting full-time and part-time workers in the private sector and in Federal,State and Local Governments.

An employees FLSA code determines how theirpayroll and accruals are calculated. Lets take alook at the four FLSA categories and codes now.


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Covered FLSA Codes C: Covered Regular

F: Covered Firefighter

L: Covered Law Enforcement Z: Covered Seasonal and

Emergency Responders


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Covered FLSA Category Overtime is calculated at one and one-half (1 )

hours for each overtime hour worked.

Employees that are covered under the FLSAregulations can accrue comp time or receivepayment.

Previous 6 months comp time balances willgenerate a payoff with the first check in Januaryand the first check in July. All comp time will bepaid at the time of transfer to another stateagency, separation from state service, or a changeto an exempt FLSA.


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Exempt FLSA Codes A: Administrative

I: IT Computer Workers

P: Professional S: Temporary code allows exempt

employees Overtime to bepaid with prior Board of

Examiners approval X: Other


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Additional Exempt FLSA Codes B: Educational Administrative

D: Educational Executive

J: Educational IT (Computer Workers) Q: Educational Professional


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Additional Exempt FLSA Category The additional exempt category is only used for

state educational institutions.

Employees are ineligible for OvertimeCompensation.

Employees are ineligible for Shift Differential.


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Executive FLSA Code

E: Executive


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Executive FLSA Category Employees are ineligible for Overtime and

compensation beyond 80 hours a pay period.

Time sheet is only required if leave is taken formore than half a day (exception reporting) or ifthe employee is part-time. Time sheet indicator isset to N for full-time employees.


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Non-Covered FLSA Code N: Non-Covered


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Time Codes Time Codes define the type of time that is coded

on the employees time sheet.

Time Code availability may be position or agencyspecific.

Time Codes are three bytes and are alpha only.

Lets review some of the mostcommon time codes.


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Payroll Calculation

Time Codes - Types of Time

ACT - (Actual Hours Worked): The system usesthese hours to calculate hours worked and overtime

for an employee. ADT - (Administrative Leave Taken): Approvedleave with pay at the discretion of the appointingauthority when such leave is in the best interest ofthe agency. No leave balance is reduced.

CPT - (Compensatory Time Taken): Hours submittedare subtracted from the employees comp timebalance.

HOA - (Holiday Worked and Accrued) Hourssubmitted for hours worked on a holiday to accrue attime and a half.


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Time Codes - Types of Time HOL - (Holiday Pay - Not Worked): A day of

exemption from work for which an eligible employee iscompensated for. No leave balance is reduced.

MLT - (Military Leave With Pay): Employees who aremembers of the National Guard or reservists in thearmed forces of the United States engaged in militaryduty ordered or authorized under the provisions of laware entitled each calendar year to one hundred twenty(120) hours of military leave of absence from theirrespective duties without loss of pay, credited stateservice hours or evaluation of performance. Employeeswho are FLSA = F, should use time code MLF and areentitled to 156 hours per calendar year.


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Payroll Calculation

Time Codes - Types of Time SIC - (Sick Leave Taken): Leave taken in cases of

illness, disability or other medical and healthreasons, for the employee or immediate family

which require the employees absence from work.Hours submitted are subtracted from employeessick leave balance.

VAC - (Vacation Leave Taken): Leave taken byemployee with approval of their supervisor. Hours

submitted are subtracted from employeesvacation balance.These are only a few examples of time codes. For a completelist and time codes available please refer to the DSP UserManual on our Web site www.sco.idaho.gov


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Payroll Calculation

Removal of EAL Accrual Process DHR rule section 259 (Compensable Hours) states,

With the exception of holiday leave (HOL) and

holiday worked (HOA, HOS, HOW), no leave maybe used if it will result in pay in excess ofemployees regularly scheduled work week.

EAL accruals for L (Law Enforcement) and F (FireFighters) will continue to accrue EAL until further

notice.


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Payroll Calculation

Payroll Calculation Formula

The Payroll Calculation Formula is calculated inthe following order.

1. Holiday Pay2. Holiday Overtime

3. Overtime over 40 hours

4. All Leave Taken

5. Regular Time We will calculate the following time withthe assumption the employee is covered(FLSA C) and override indicator is set to

accrue.


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Holiday Pay

Pay Stub

Description Rate Hours Amount

Holiday $10.00 8.0 $80.00

Reg Pay $10.00 32.00 $320.00

Total Gross $400.00

Holiday Pay - paid: 8.0

Holiday Overtime - paid or accrued: 0.0

Overtime over 40 - paid or accrued: 0.0

Hours Worked - minus overtime: 32.0Leave Taken - paid: 0.0

Total Hours Paid: 40.0

In this example there are 8holiday hours ...

and there are 32 regularhours worked

for a total of 40 hours tobe paid to the employee.


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Payroll Calculation

Holiday Overtime Hours worked on a holiday are compensated as holiday

overtime. After the system has identified holiday pay, it will then

identify if a holiday was worked, creating holiday overtime.

Time Code Sun Mon Tues Wed Thurs Fri Sat Total

HOL 8.0 8.0

HOA 8.0 8.0

ACT 8.0 8.0 8.0 8.0 32.0


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Payroll Calculation

Overtime over 40 Overtime is compensated when an employee has worked over 40

hours in a work week.

Overtime over 40 is the third step in the Payroll Calculation.


ACT 8.0 8.0 8.0 8.0 10.0 42.0


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Payroll Calculation

Overtime over 40

Pay StubDescription Rate Hours Amount

Reg Pay $10.00 40.0 $400.00

Overtime @ 1.5 $0.00 3.0 $0.00

Total Gross $400.00




Hours Worked - minus overtime: 40.0

Leave Taken - paid: 0.0


In this example there are 42regular hours worked resulting in

2 hours of overtime...

and 40 hours of regular time

for a total of 40 hours paid and3 hours accrued.


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Payroll Calculation

Leave Taken Agency will decrease leave taken to assure compensation is not in excess of

employees regularly scheduled work week. Holiday worked hours should not becounted in the total hours when reducing leave taken.


HOL 8.0 8.0

HOA 8.0 8.0

ACT 8.0 8.0 10.0 26.0

VAC 8.0 8.0


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Payroll Calculation

Holiday worked and leave taken Agency will not decrease leave hours in situations where employee

works on a holiday. Since employee has over 48 hours, but worked 8hours on the holiday, the sick leave of 8 should not be reduced. Hoursworked on the holiday in this scenario are paid.

Time

CodeSun Mon Tues Wed Thurs Fri Sat Total

ACT 8.0 8.0 8.0 24.0

HOW 8.0 8.0

HOL 8.0 8.0

SIC 8.0 8.0


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Hours over 40 For example, an employee worked 34 hours and also receives 8 hours of

holiday pay. 34 + 8 = 42 hours to be paid. Remember HOL should never bereduced to avoid paying employee above their scheduled hours.


HOL 8.0 8.0

ACT 8.0 8.0 8.0 10.0 34.0


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Payroll Calculation

Hours over 40

Pay Stub

Description Rate Hours Amount

Holiday $10.00 8.0 $80.00

Reg Pay $10.00 34.0 $340.00

Gross Total $400.00




Hours Worked -minus overtime: 34.0Leave Taken - paid: 0.0


In this example there are 8 holidayhours

...34 regular hours worked

resulting in 42 total hours paid(34 Reg + 8 Hol)


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Payroll Calculation

Review Of all the DSP Applications and processes, payroll

calculation seems to be one of the more difficultconcepts/procedures to understand, yet it is one

of the most important concepts we need to be ableto explain to our employees. In our generaloverview today, weve covered four key areas ofpayroll calculation: Payroll Calculation Defined

Fair Labor Standards Act (FLSA) Time Codes Automatic Overtime Calculation


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Payroll Calculation Self-Guided

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