Payroll
Payroll jgastley3Employee Awards and Prizes
Employee Awards and PrizesPrizes and awards (cash and non-cash) made to employees are considered wages. In accordance with the Internal Revenue Service regulations, awards and prizes are subject to FICA, FUTA, and federal and state income tax withholdings. All awards and prizes given to Georgia Tech employees must be paid and/or reported through the Georgia Tech Payroll Department, to ensure that taxes are properly withheld.
If sufficient funds are available, the employee taxes may be paid in addition to the dollar amount awarded to the employee.
Example: Employee Award to be paid (Net) $1,000.00 Employee Taxes (Fed 25% + State 2% + FICA 7.65%) $ 530.22 Employer Tax (FICA 7.65%) $ 117.06 Total Expense ($1,530.22 EE + 117.06 ER) $1,647.28 - If the employee will be responsible for paying the taxes:
| Example: | |
|---|---|
| Employee Award to be paid | $1,000.00 |
| Employee Taxes **(award amount x 7.65% + Fed 25% + State 2%) | $ 346.50 |
| Net Employee Award | $ 653.50 |
| Employer FICA** | $ 76.50 |
| Total Expense ($1,000 EE + 76.50 ER) | $1,076.50 |
**Note: If the employee has reached their social security annual maximum, there will only be 1.45% medicare tax charged.
| Employee taxes are withheld as follows: | |
|---|---|
| Federal 25.00% FICA (6.2% SS + 1.45% Medicare) | 7.65% |
State < $8,000 – 2% 8 – 10,000 – 3% 10 – 12,000 – 4% 12 - 15,000 – 5% > 15,000 - 6% |
All recipients (employee, student employee, and non-employee) should be submitted on the Awards and Prizes form. Forms may be obtained on line http://www.ohr.gatech.edu/; under Payroll (https://techworks.psguest.gatech.edu:5963/psp/paprodg/EMPLOYEE/EMPL/e). The Payroll Department will verify the employment status. If a recipient is not an employee, the initiating department will be notified to pay the recipient through AP. Prizes for non-employee recipients should be submitted on AP check request form.
Forms
A copy of the Awards and Prizes form is available as a reference for the following instructions. This sample form has numbers written on it which correspond to the numbers in the instructions below.
Instructions for completion of the Awards and Prizes form:
- Enter the name of the award/prize event.
- Enter the name and phone number of the award coordinator.
- The form must be signed and dated by an authorized department administrator.
- Enter the award/prize presentation date.
- Enter the name and phone number of the person responsible for check pick-up.
- Enter the date needed and if it is to be a check or deposited with their next payroll.
- Check the “Gross Up” box if the department wishes to absorb recipient’s taxes (approx. 34.65%)
- Enter the name of the award/prize recipient.
- Enter the recipient GT ID and Employee ID.
- List the purpose of the award/prize.
- Enter the $$$ amount of award payment
- Enter the estimated department’s total expense of the award including any employer portion of the FICA (7.65%), and the employeeportion of taxes if the department is willing to pay for them. (Please refer to the gross-up examples above for calculation).
- Enter GT peoplesoft project #/name. No State Fund is allowed.
- Enter GTF/GTRC Project # (Funding Source).
The department should submit the form to Accounting Services for review if the funding source is Georgia Tech Foundation. If the funding source is Georgia Tech Research Corporation, the form should be approved by Grants and Contracts. After the form is approved, it will be forwarded to Payroll for check processing.
Off-Cycle Payroll
Off-Cycle Payroll jgastley3The Institute follows the University System of Georgia’s policy for Off-Cycle Payroll Policy. The USG requirements can be found the Business Procedures Manual at: https://www.usg.edu/business_procedures_manual/section5/C1235/#p5.3.8_off_cycle_payroll_processing
For more information on Institute procedures head to ASC/HR ServiceNow knowledge base.
Regulations and Guidelines
Regulations and GuidelinesThis procedure provides information regarding Internal Revenue Service, State of Georgia, and Georgia Tech regulations.
Payment to Employees for Personal Services
According to Common Law Rule:
"Every individual who performs services subject to the will and control of employer, both as to what shall be done and how it shall be done, is an employee for purposes of all federal payroll taxes. It does not matter that employer permits employee considerable discretion and freedom of action, so long as employer has legal right to control both method and result of the services."
Refer to the Accounts Payable Procedure Consulting - Attachment C to review the 20 factors developed by the Internal Revenue Service to aid in determining whether there is an employer-employee relationship. Students receiving Fellowships that require them to perform services should be aware that this income may be taxable.
To ensure compliance with the Fair Labor Standards Act, regulations of the Internal Revenue Service, and laws of the State of Georgia, Georgia Tech will purchase services from employees only through the payroll system. This arrangement precludes any type of contractual agreements with any University employee for payment of services other than through established payroll procedures.
Payment for personal services will be made on regularly scheduled pay dates only. State regulations prohibit advance payments.
Standard Workweek
The standard workweek for non-administrative classified employees at Georgia Tech is 40 hours, from 12:01 a.m. Sunday through 12:00 midnight on Saturday. If it is necessary for an employee's workweek to exceed 40 hours, the overtime must be pre-approved by the department head.
Overtime
Payment for Overtime
Any non-exempt classified employee of Georgia Tech (as defined by the Fair Labor Standards Act) who is required to work more than 40 hours during a workweek will be paid at one and one-half times his/her standard rate for all work in excess of 40 hours, unless compensatory time is authorized. If an employee is paid on more than one account and the combined hour for the workweek exceed 40, the total pay will be prorated to each account based on the percentage of time reported per account to total time reported each workweek.
Compensatory Time
The Board of Regents Personnel Policies Handbook, Section II--Classified Employment states:
"In lieu of payment for approved overtime work, compensatory time may be granted at the rate of one and one-half hour of compensatory time for each hour of overtime work. Approved compensatory time is subject to a maximum accumulation of sixty (60) hours and must be expended by the end of the succeeding calendar quarter."
Participation in research projects (Human Subjects)
Payments under $75 per participant will be considered de minimis and not reported on a W2, 1042S nor 1099 Misc. Participants must pass the Selection of Human Subjects criteria:
- Full or part time employee of the Institute,
- Full or part time undergraduate student,
- Full or part time graduate student, provided the graduate student’s funding department agrees that the student may participate in the research.
- Students who are on financial aid assistance,
- Non-Institute affiliated individuals.
Social Security Coverage
Social Security Coverage jgastley3All regular employees of Georgia Tech, except those specifically excluded under an agreement with the Social Security Administration, have social security taxes taken out of their paycheck. To learn more about Social Security visit https://www.ssa.gov/
Student Pay Group
Student Pay GroupIn order to comply with federal Fair Labor Standard Act (FLSA) regulations, no Georgia Tech employee, student or non-student, shall be hired concurrently in both a monthly paid exempt status plus a bi-weekly paid non-exempt status.
The Fair Labor Standards Act (FLSA) establishes minimum wage, overtime pay, record keeping, and child labor standards affecting full-time and part-time workers in the private sector and in Federal, State, and local governments. Covered nonexempt workers are entitled to a minimum wage of not less than $5.85 per hour effective July 24, 2007; $6.55 per hour effective July 24, 2008; and $7.25 per hour effective July 24, 2009. Overtime pay at a rate of not less than one and one-half times their regular rates of pay is required after 40 hours of work in a workweek.
In order to comply with federal Fair Labor Standard Act (FLSA) regulations, no Georgia Tech employee, student or non-student, shall be hired concurrently in both a monthly paid exempt status plus a bi-weekly paid non-exempt status. The Institute will derive the weighted-average pay rate based upon these concurrent hourly rates of pay and pay any overtime accordingly. If the student is paid as a monthly exempt employee, the percentage distribution will be utilized to allocate their time worked to the hiring department and the associated account number.
Exempt employees (student or non-student, full time or part time)
are paid monthly and are exempt from the Fair Labor Standards Act (FLSA) and therefore not subject to overtime payments.
Non-Exempt employees (student or non-student, full time or part time)
are paid bi-weekly and are not exempted from the Fair Labor Standards Act (FLSA) and therefore are subject to overtime payments for all hours worked in excess of 40 hours per work week.
Our workweek is
Sunday through Saturday. Time worked does not include Holiday, Vacation or Sick pay.
All employees must be paid in only one pay group, either monthly or bi-weekly. For example: if a student is paid monthly and is hired into a concurrent job in a department that will pay them hourly on the bi-weekly payroll, the originating department will be notified by Payroll that the situation exists and the student will not be hired into the concurrent position until there is an agreement to make the student in one pay group, most likely hourly. When agreed upon, the Payroll Department will correct the PSF and process the transaction.
Time & Leave Reporting
Time & Leave ReportingIn compliance with the University System of Georgia (USG) and Georgia Tech policies, the Fair Labor Standards Act (FLSA) and the Affordable Care Act (ACA), Georgia Tech must maintain accurate daily work time records for all non-exempt employees and all part time employees.
Georgia Tech must also maintain records of all absences (whether paid or unpaid) on both non-exempt and exempt employees (including faculty).
Prohibited Activities
Misrepresenting working hours, falsifying signatures or timesheet information, recording time from an unauthorized Georgia Tech device or location or tampering with a Georgia Tech time clock/kiosk or another employee’s timesheet are extremely serious offenses. Employees found to have engaged in any of these prohibited activities will be subject to disciplinary action, up to and including dismissal.
Delegated Authority
Delegation enables one person to authorize another to serve as their representative (proxy) when managing time transactions. A manager can delegate their tasks of approving time and entering employee time to another person due to workload or their own absence from the office. Delegated authority can be upward, lateral, or downward within the reporting hierarchy. Once the delegation framework passes delegated authority over a transaction to a proxy, the proxy cannot delegate authority over that transaction to another person. Both parties maintain responsibility to ensure compliance with policies and procedures.
Exception Time Reporting
Exempt employees reporting process which requires an Exempt Employee to only report leave time used during a pay period (i.e., sick, vacation, jury duty, etc.). If the Exempt employee has no leave to report, the only action required is the employee and manager’s time sheet approval.
Fair Labor Standards Act (FLSA)
Federal act that establishes minimum wage, overtime pay, recordkeeping, and child labor standards affecting full-time and part-time workers in the private sector and in Federal, State, and local governments.
Non-Exempt
Employees who do not meet any of the Fair Labor Standards Act exemption tests and are covered by wage and hour laws regarding minimum wage, overtime pay, and hours worked. Non-exempt employees are entitled to overtime compensation for any hours worked over 40 in an established workweek. Exempt: Employees who meet one of the FLSA exemptions (i.e. Executive, Administrative or Professional) and are not entitled to overtime.
Positive Time Reporting
Non-Exempt Employees Reporting process which requires a Non-Exempt Employee to submit a timesheet of hours worked in order to be paid. The timesheet includes regular time for all hours worked in addition to leave time taken within an established workweek.
Timesheet
An official document for recording the number of hours worked and/or leave taken by an employee in a work week or pay period. The timesheet can be in a form of electronic or paper documentation.
Employee Responsibilities:
Non-exempt Employee Responsibilities. Non-exempt employees must accurately report all hours worked and any leave taken during the established workweek. Such records must document hours actually worked, rather than hours scheduled to work. Each non-exempt employee is responsible for ensuring that all time worked and leave taken are accurately reflected on their timesheet, and the timesheet must be approved by the employee by the established payroll approval deadlines. Failure to approve the timesheet by the established deadline may jeopardize on-time processing and receipt of employee pay.
Exempt Employees Responsibilities:
Exempt employees (staff and faculty) only record exception time on the timesheet. The employee’s time sheet must be approved by the employee by the established payroll approval deadlines.
Part-time Faculty:
Generally, the ACA conversion chart will be utilized to determine weekly hours worked for part-time faculty. (See HRAP Employee Category – ACA Requirements.) If a part-time faculty member is working hours in excess of what is shown in the conversion chart, these hours must be recorded, approved by the supervisor, and entered on the employee’s timesheet for tracking for ACA purposes. If the conversion chart does not accurately reflect hours worked for a part-time faculty member, the part-time faculty member should track actual hours worked. If leave or time reported changes after approval is submitted, the employee is responsible for notifying their Primary Approver by submitting the required documentation to update the time and leave record. Continual neglect by an employee to approve time and/or leave in accordance with established policies and pay dates may result in disciplinary action.
Primary Approver Responsibilities
The Primary approver is typically the direct line supervisor with authority to approve or deny leave. The primary approver is responsible for ensuring that all time and leave records are current and accurate for their areas of responsibility. Managers with timesheet approval responsibilities are required to approve timesheets for their direct reports as required by the Institutions’ established payroll approval deadlines. If primary approvers are not available to approve timesheets in accordance with the established approval dates, their responsibility must be delegated to an authorized and approved proxy.
An individual who is reporting time should not be responsible for approving their own time or that of their peers.
If leave or time reported changes after approval is submitted, the employee is responsible for notifying their Primary Approver by submitting the required documentation and the Primary Approver is responsible for updating the time and leave record and submitting changes to the appropriate institutional office for recording and record retention.
Primary approvers who do not review, correct, and approve timesheets by the deadlines may be subject to disciplinary action. Departments may require a more rigorous process as deemed appropriate and documented in the departments time and leave approval procedures.
Types of Payrolls
Types of PayrollsThis procedure explains the various pay cycles and pay calculations.
Monthly Payroll
Faculty, administrative personnel, salaried Graduate Assistants, Graduate Teaching Assistants, and Graduate Research Assistants, and employees exempt from coverage under the Fair Labor Standards Act (Wage and Hour Law) are paid on the monthly payroll.
Employees compensated on the monthly payroll are paid on the last workday or banking day of each month. If the last workday is an Institute or bank holiday, payment is made on the day before the holiday.
Payroll Calculations
- Full Month Compensation (other than those on an Academic Contract)
The amount of monthly compensation is equivalent to one-twelfth of the fiscal year annual salary.
- Partial Month Pay Calculation
The number of days worked in a month is divided by the total number of workdays to determine a percentage of compensation for that month. Partial pay is calculated by multiplying the monthly rate by the percentage of compensation.
- Vacation Pay Upon Termination
Terminating vacation pay is calculated by multiplying the daily rate by the total days of accrued vacation leave. The daily rate is computed by dividing the annual salary by 2,080 hours x 8. The maximum accrued leave that can be paid upon termination is 45 days.
- Academic Pay Cycle under the Semester System
Under Georgia Tech's semester system, individuals paid on the academic pay cycle receive 10 monthly payments during the regular academic year. The academic year salary is paid out over the 10 months of the academic contract year: 1/18 of academic year salary in August, 1/9 of academic year salary from September through April, and 1/18 of the academic year salary in May. In other words, the employee receives 1/2 of a months pay in May and August, and a full months pay the other 8 months. The summer session is handled separately during the four months from May through August, with the May and August summer salary payments being added to the employee's regular academic year monthly salary, if any. AMN, AMG, RWA will follow proration rule, effective 08/01/02.
While the above describes the general rule of pay for the academic pay cycle, other job events do have a bearing on a particular individual's pay: pay increases for the new Fiscal Year, terminations, retirements, and leave all affect pay. The following describes in detail the pay rules for August and May under Georgia Tech's semester pay system.
August Payment Rules
August Pay for 9-Month (Academic Cycle) Instructional and/or Research Faculty, Post Docs, and Graduate Students will be paid in compliance with the 10-payment plan described above. The August Pay will reflect the Last Payment for the Summer Session and First Payment for the Fall Semester. Payment rules that will be applied are:
9 MONTH FACULTY:
- Instructional and/or Research Faculty with hired in August will be paid 1/2 of their monthly rate.
- Instructional and/or Research Faculty that are terminating, retiring, or on leave without pay effective the 1st day of the fall semester will be paid only the Summer Pay entered into the Summer Pay Panel or via pay.ask. If no Summer Pay has been entered or submitted via pay.ask, these employees will not be paid.
GRADUATE STUDENTS PAID ON ACADEMIC PAY SCHEDULE:
- Graduate Students pay is prorated according to the number of days worked.
The formula to calculate partial pay for August is:
____ # Days worked divided by Total # work Days in August = ____
% days worked ____ % Days worked times ____ Monthly Rate of Pay = _____August Partial Pay
EX: Jamie Dollar's appointment date is effective 8/21/2006 and the monthly rate of pay is $1500.00. As a result, he will be paid 9 of 23 workdays in August.
9 divided by 23 = .313182 times $1500.00 = $586.96
Please forward all questions to pay.ask@business.gatech.edu
Bi-weekly Staff and Student Payroll
Employees, including students, covered under the Fair Labor Standards Act (FLSA) and hourly appointments for employees exempt from the FLSA are paid bi-weekly.
Hourly appointments of non-exempt staff assigned to a line budget position or a group budget position and hourly exempt staff are paid bi-weekly. Hourly appointments of Graduate Research Assistants, and Student Assistants also are paid bi-weekly. The annual salary is determined by multiplying the hourly rate x 2,080 hours. The gross amount of each check is determined by multiplying the hourly rate of pay by the number of hours reported on the bi-weekly time document.
Pay dates are normally 7 work days after the pay period ends. If the pay date falls on a holiday, including bank holidays, payment will be made on the preceding workday.