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While many agencies are very conscientious about submitting payroll within the established timelines, OMES continues to receive late payroll submissions from some agencies. Not only are some agencies missing the five-day deadline, some agencies are not submitting payrolls in time to meet the scheduled due date for direct deposits. The ability to manually intervene on those payrolls is being eliminated. If your payrolls are not submitted timely, your employees will be paid late and it will fall on the agencies to address any questions about why employees were paid late. In some cases, they may be as many as five days late. OMES will report the agency’s failure to process timely as the reason employees are not getting paid on time.
For those agencies that are following the five-day rule, good job, keep up the good work. If your agency is submitting payroll after 3 p.m. on the fifth day prior to pay date, but before 3 p.m. on the third day prior to pay date, please review your processes and make any necessary changes to allow the payroll to be submitted in accordance with established policies. The two extra days allow for processing problems or other delays.
For those agencies that submitted so late to have required manual intervention, you must review your processes and make necessary changes to ensure that payrolls are submitted timely. Future payrolls that are submitted late will result in late payment to employees.
In the October 2013 DCAR newsletter, an article outlined the processing deadlines. Please review that article to ensure that your processes are meeting the deadlines established by policy. Remember that this policy requires submission five business days prior to the pay date and on months with holidays, it is important that agencies plan accordingly.
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PAYROLL
Giving gifts to employees is restricted and should only be given as part of a formal employee recognition program. See Oklahoma Statutes, Title 74, Sections 4121 and 4122. Furthermore, any gift cards, certificates and coupons given to employees are to be included in the employee’s taxable income. These items are considered by the Internal Revenue Service to be cash or a cash equivalent and do not meet the requirements to be excludable as a de minimis fringe benefit.
Even when an employer provides gift cards, certificates or coupons to purchase a turkey, ham or other nominal value property, these are considered wages and are subject to income and employment taxes. This is true even when the card restricts the items purchased, the time to use the coupon and any unused portion is forfeited. Cash equivalents do not meet the de minimis fringe benefit requirements.
PeopleSoft state agencies: Process the gift amount using the TRC Code of “GIFT,” which will show as earnings code “GFT.” The amount will be included as taxable income and will be taxed on the paycheck.
Higher education interface agencies: Process the gift card amount using earnings code “GFT”. The amount will be included as taxable income and will be taxed on the paycheck.
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Beginning in 2012, the IRS mandated Box 12 reporting for the cost of employer-provided health coverage. The W-2 must show the amount in Box 12 with Code DD.
To correctly report the cost of health coverage, all payments made for health insurance must process through the payroll system. Failure to process through payroll will result in incorrect reporting on the W-2. For help establishing the appropriate deduction codes, state agencies should contact the OMES HelpDesk. Assistance will be provided by the Core HCM Payroll team. For institutions of education, please ensure payroll file information contains the total cost of health insurance (employer and employee share).
As a reminder, this reporting to employees is for their information only. The amount reported is not taxable and is only intended to inform them of the cost of their health care coverage.
For questions or more information, please contact Lisa Raihl at (405) 521-3258 or lisa.raihl@omes.ok.gov, or Jean Hayes at (405) 522-6300 or jean.hayes@omes.ok.gov.
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Agencies need to review all outstanding employee overpayments and collect required amounts from employees. After collection, please submit OMES Form 94P as applicable. Agencies will be entitled to receive refunds for all forms submitted by Friday, Dec. 20, 2013. After this date, refunds cannot be returned to the agencies; however, agencies are still required to submit the form after this date for employee wage corrections. Corrections due to overpayments will still be posted to the employee’s 2013 W-2 for requests submitted through Tuesday, Jan. 7, 2014.
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The OMES Form DER, Deceased Employee Reporting, is required to be completed by agencies when an employee dies and payments are made after the date of death. The form is on the OMES website under DCAR Forms. Once completed, please send the form to OMES/DCAR payroll, attention Lisa Raihl or Jean Hayes. Please have all forms completed and submitted no later than Tuesday Jan. 7, 2014 so that 2013 year-end reporting will be correct.
For procedures on processing payroll after the death of employee, the HCM how-to document titled ‘Payroll Processing for Death of an Employee’ is on the CORE website under HCM’s Module News for ‘How-to Documents’.
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Title 40, O. S., Section 165.3a, allows employers to provide employees the option of designating a beneficiary for wages and benefits payable upon an employee’s death. There is no requirement for an employer to allow employees to select beneficiaries, but agencies may want to consider adopting a policy which allows employees to designate a beneficiary. Providing the option to employees would relieve stress and anxiety after the death of the employee on the family members, etc. Also, agencies would have clear guidance on who is to receive final wage payments and avoid any potential difficulties in determining who gets the payment(s).
This statute does not include any longevity payment that may be due as of the date of death of an employee. Title 74, O.S., Section 840-2.18, subsection H.2, authorizes any longevity payment to be paid to the decedent’s surviving spouse, or if there is no surviving spouse, to the decedent’s estate.
For more information or sample forms and instructions, please contact Lisa Raihl at (405) 521-3258, lisa.raihl@omes.ok.gov or Jean Hayes at (405) 522-6300, jean.hayes@omes.ok.gov
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Please verify the correct agency address is being used in the HCM payroll system. The agency address can be found on the Employee’s Earnings Statement. If the address is not correct for the agency, this will need corrected before year end processing of tax forms. Please contact the OMES Help Desk to have the agency’s address updated in the payroll system.
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For state EBD insurance purposes in calendar year 2014, please distribute this listing to Payroll and Human Resource Directors (to view the table click the link ). Questions may be directed to Lisa Raihl at (405) 521-3258, lisa.raihl@omes.ok.gov or Jean Hayes at (405) 522-6300, jean.hayes@omes.ok.gov.
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ACCOUNTING
There is a new form to use for requesting the authority to make a payment of expenses incurred in a prior year’s budget period where said budget is no longer available due to lapsing of the funds or where the budget is rolled forward into a subsequent year’s budget. The form will be used whether the payee is an interagency vendor or an outside vendor. The new form is named “Agreement of Obligation for Expenses Incurred in Prior Year” and is available on the OMES website under the Comptroller’s Page, then under ‘DCAR Forms’.
On this form we have removed the requirement of the former “Legal Settlement Agreement” to be signed by the agency’s legal counsel authorized to act on behalf of the agency (or agency’s attorney general representative). Once the form is completed and signed by the appropriate agency representative and the vendor, the new form requires submission to the OMES budget firector for approval/denial of the payment with current year budget. Please submit the agreement electronically to your OMES budget analyst.
If the form is approved, it is considered a current obligation and therefore, a current expenditure subject to current budget. In addition, such actions will not require prior encumbrance, therefore, the voucher would be processed as an unencumbered payment and not against a purchase order or contract.
NOTE: This procedure should not be confused with the ratification process under the Oklahoma Central Purchasing Act, which ratifies an unauthorized commitment. Please refer to the OMES Central Purchasing Division Rules.
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BUDGET
As a reminder, OMES provides a statewide subscription to Federal Funds Information for States (FFIS). FFIS’s primary mission is to track and report on the fiscal impact of federal budget and policy decisions on state budgets and programs. This information is maintained in a database of more than 200 federal grant-in-aid programs that account for more than 90 percent of all federal funds flowing to state and local governments. It is disseminated to subscribers through a regular series of reports and briefs, and is also available via the website. If you are interested in receiving the information provided by FFIS, please contact your budget analyst to get you set up.
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The Funding Book Report is now available for agencies to review. The report is in PeopleSoft Financials and can be run by going to Commitment Control/Funding Book Report. Please review your agency’s information. Let your budget analyst know if you have any questions or if there are any corrections that need to be made.
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