Description of the decision to be made
Fair Labor Standards (FLSA) rules state that banked overtime is to be paid at the employee’s current FLSA rate (one and one-half times the employee’s regular rate of pay, including additional compensation such as longevity). The rules state that non-banked overtime should be paid at the FLSA rate for the week in which it was earned, as long as payment is issued in a timely manner.
The University will implement banking of FLSA Overtime for all benefits eligible, non-exempt employees. Individual departments will not be required to submit a banking agreement to Human Resources. Departments can choose to pay overtime instead of banking, as long as payment is issued in a timely manner. Because federal law mandates either payment or banking of overtime, there is not a decision point for the steering committee, but the steering committee should be aware of the change.
Recommendation
If a department chooses to pay overtime hours rather than bank them, the effective date on the payment request will be the last day of the workweek (Sunday) in which the overtime was earned. If the hours are not paid within 30 days (four workweeks) after they were earned, the hours will be considered to be banked. Banked overtime must be paid at the current rate, so the effective date of the payment for these hours will be the date the payment is initiated.
Time-frame
This is an informative change that will take effect with the Workday go-live.
Recommended Campus Stakeholders to Engage
ASMP-Workday Steering Committee for awareness
Stakeholders during design confirmation
Campus as training and change materials are developed and made available
