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STATE OF CONNECTICUT |
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NANCY WYMAN
COMPTROLLER |
OFFICE OF
THE STATE COMPTROLLER
55 ELM STREET
HARTFORD, CONNECTICUT 06106-1775 |
MARK OJAKIAN
DEPUTY COMPTROLLER |
MEMORANDUM NO. 2000 - 58
November 27, 2000
TO THE HEADS OF ALL STATE AGENCIES
Attention:
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Chief Administrative and Fiscal Officers, Business Managers, and
Payroll and Personnel Officers
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Subject:
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Retroactive Salary Increases, Retroactive Annual Increments, And
Interest Penalty for Retired and Separated Administrative and Residual (P-5)
Bargaining Unit Employees
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I. AUTHORITY
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The arbitration award between the State of Connecticut and the Administrative
and Residual (P-5) bargaining unit, for the period July 1, 1999 through June 30,
2003, was approved by Legislature on June 19, 2000. Due to a legal dispute, the
contract had been held up by the judicial system. On October 3, 2000, the
Superior court issued its decision that the award could be implemented.
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Pursuant to Section 5-276b of the Connecticut General Statutes, an interest
penalty of 5% per annum is to be paid for late implementation of the provisions
of the P-5 Interest Arbitration dated April 24, 2000. The 5% is payable for the
period April 24, 2000 until the date an employee receives all the retroactive
amounts due him/her under the award.
II. ELIGIBLE EMPLOYEES
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Administrative and Residual Bargaining Unit employees who were actively
employed on July 1, 1999 but have since retired or separated from State service.
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Administrative and Residual Bargaining Unit employees who were actively
employed on July 1, 1999 but were promoted into another collective bargaining
unit, should contact their agency personnel officer to initiate any compensation
due or there may be an over payment issue. Please refer to OLR memo dated
November 14, 2000.
III. COMPENSATION
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A. Retroactive General Wage Increases are effective as follows:
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Effective Date |
Increase |
June 18, 1999 (Retroactive) |
2% of Base Salary |
December 31, 1999 (Retroactive)
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2% of Base Salary
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June 30, 2000 (Retroactive)
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3.5% of Base Salary
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B. Retroactive Annual Increments and Retroactive Lump Sum Payments for
Maximum Step Employees and the Addition of an Eighth Step
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Effective June 18, 1999, eligible employees who were at the maximum step of
the salary schedule as of the annual increment effective dates should receive a
2.5 percent lump sum payment when the annual increment would have applied.
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Effective June 30, 2000, the pay plan is modified by the adding of a full 8th
step, which is 3.0 percent above step 7.
IV. RETROACTIVE PAYMENTS
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When recalculating the retroactive payments, agencies are to calculate to the
date of retirement or separation. For the pay periods 06/18/99 through 10/19/00
agency staff must calculate and process the following retroactive payments
manually. Checks dated 12/29/00 should reflect the additional compensation due
as a result of the manual calculation of the retroactive difference due on the
biweekly and overtime payments made to impacted former employees during the
aforementioned dates and lump sums as applicable.
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Payments should be identified separately and coded with the applicable DOE.
Such payments are subject to mandatory deductions: federal withholding tax and
state income tax annualized, social security tax, retirement contributions and
garnishments (if applicable). Any lump sum retirement sick pay is subject to
federal withholding, state income tax annualized and social security tax only.
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A. Retroactive General Wage Increase (GWI)
Effective Date
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Salary Increases
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Period Covered
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Check Date
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June 18, 1999
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2% of base salary
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06/18/99 - 10/19/00
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12/29/00
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December 31, 1999
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2% of base salary
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12/31/99 - 10/19/00
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12/29/00
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June 30, 2000
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3.5% of base salary
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06/30/00 - 10/19/00
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12/29/00
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B. Retroactive Annual Increments and Lump Sum Payment at Maximum Step
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Effective Date
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Period Covered
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Check Date
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July 1, 1999
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06/18/99 - 10/19/00
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12/29/00
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January 1, 2000
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12/31/99 - 10/19/00
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12/29/00
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July 1, 2000
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06/30/00 - 10/1900
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12/29/00
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V. CALCULATION OF INTEREST PENALTY FOR RETIRED AND SEPARATED EMPLOYEES
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An interest penalty of 5% is payable for the period April 24, 2000 until the
date the eligible employee receives all the retroactive amounts due him/her
under the Arbitration Award.
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It is possible that one or more wage increases were due before the award was
issued and another wage increase was due after the award was issued, therefore,
the amounts due will have to be split out and the number of days for which
interest should be made will need to be calculated individually.
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A. Retroactive Payments For Eligible A&R Employees Actively Employed Between June 18, 1999 and June 29, 2000 But Since Retired or Separated.
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Multiply the retroactive amount paid by the number of days between April 24,
2000 and the date of payment of the retroactive amount (December 29, 2000*)
divided by 360; then the product multiplied by 5%.
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Example: If retroactive amount was $1000:
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249/360 x 5/100 x $1000/1 = $ 34.58
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B. Retroactive Payments For Eligible A&R Employees Actively Employed
Between June 30, 2000 and October 19, 2000 But Since Retired or Separated.
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Multiply the retroactive amount paid by the number of days between June 30,
2000 and the date of payment of the retroactive amount (December 29, 2000*)
divided by 360; then the product multiplied by 5%.
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Example: If retroactive amount was $800:
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140/360 x 5/100 x $800/1 = $ 15.55
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*Agencies that already made the retroactive payment must calculate to the
check date of that payment.
VI. RETIREMENT PROCEDURES
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The additional retroactive compensation must be reported to the Retirement
and Benefits Services Division in the manner described below as such additional
payments may have an impact for retirement benefit purposes.
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Each agency must provide the Retirement and Benefit Services Division's Audit
Unit with a list of affected retirees accompanied by the worksheet detailing the
calculations utilized for these adjustment payments. Worksheets for separated
employees must also be provided with a clear notation on each worksheet
indicating such status.
VII. PAYROLL PROCEDURES
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Agency staff must ensure that the employee's masterfile data (Pay Plan,
Salary Group and Step, Hourly Rate and Bi-weekly Salary) are correctly coded.
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Retired and separated employees who were deleted from the masterfile must be
set up as new employees. You must enter a pay code 1, 2 or 3 for these
individuals to avoid generating a regular pay check in the system. In lieu of
301 documentation, a memo must be submitted to the Comptroller's Payroll
Services Division listing the employees added to the payroll system for the
purpose of making this payment.
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A. Payment of Retroactive Salary Increases and Retroactive Annual Increments
(including other earnings if applicable)
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1. On-Line: Screen 047 or 190; R1; Amount; D/OE Code 10.
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2. Remote Job Entry: ZT Transaction; Same as above.
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B. Payment of Retroactive Lump Sum(s)
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1. On-Line: Screen 047 or 190; R1; Amount; D/OE Code 10.
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2. Remote Job Entry: ZT Transaction; Same as above.
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C. Interest Arbitration Award
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1. On-Line: Screen 047 or 190; R-3; Amount; D/OE Code 1U.
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2. Remote Job Entry: ZT Transaction; Same as above.
Agencies should use Major/Minor 01-920, Interest Penalty -
Payroll Awards, as the expenditure object code.
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Interest paid on a wage award is not considered wages (IRS
Revenue Ruling 72-268). Therefore, the subject interest penalty paid would not
be subject to withholding for income taxes, employment taxes, and retirement
contributions.
VIII. GENERAL
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Questions may be directed as follows:
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Salary Schedules: DAS-Personnel Division, 566-3236;
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Payroll Procedures: Office of the State Comptroller, Payroll Services
Division, (860) 702-3463;
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Remote Job Entry: Office of the State Comptroller, Payroll Services Division,
(860) 702-3451;
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Memorandum Interpretation: Office of the State Comptroller, Policy Services
Division, (860) 702-3440;
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Contract Issues: Agency Personnel Officer.
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Direct List of Affected Retirees and Separated Employees to:
Retirement & Benefits Division, Audit Unit
55 Elm Street, Hartford, CT 06106
NANCY WYMAN
STATE COMPTROLLER
NW:EH
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