This workplace reference guide is intended to be used as a tool to prevent overpayments by describing transactional and communication responsibilities for activities that impact employee pay. It should be used by all university personnel responsible for reporting and processing transactions that affect employee pay.
Overpayments may occur for a variety of reasons including, but not limited to, administrative error, late terminations or job records not ended on time, work schedule/default hours not ended correctly, duplicate transactions, untimely processing of unpaid leaves of absence, change in percent time, or time reporting errors. University units and Payroll Services are responsible for preventing and resolving overpayment situations.
Regardless of the reason for the overpayment, the university will pursue full repayment of any overpaid amount. Prevention of overpayments and timely resolution of overpayment errors are important for the proper and responsible management of all university funds. In the case of federally sponsored awards (grants), the university is not eligible to draw funds for unallowable expenditures, such as overpayments, meaning failure to correct the overpayment puts the university out of compliance with the terms of its awards.
Timely communication is key in preventing overpayments. All university units are responsible for implementing effective systems and practices for communicating activities that affect employee pay.
Best Practices for Preventing Overpayments
- Maintain adequate leave accruals and ensure you have sufficient leave accrued before requesting absences.
- Submit accurate and timely employee time records.
- Ensure employees have sufficient leave accrued before approving leave requests. Learn how to access available accrual balances.
- Review employee time records in a timely manner to ensure that leave time taken is accurately recorded (unless your HR representative conducts reviews).
- Notify your HR representative as soon as possible if an employee will be exhausting leave accruals so a leave of absence can be processed immediately in the HR/payroll system.
- If an employee terminates unexpectedly, notify your HR representative immediately so a termination can be processed in the HR information system.
- Notify your HR representative in advance of any changes in time percentage, pay, change in appointment type, etc. so an HR transaction can be processed ahead of the change.
HR Unit Representatives (and Others Involved in Reporting and Processing HR Transactions or Related Information)
- Determine if communication systems and/or processes need improvement. Consider a lean review of internal communications to minimize impact of salary overpayments.
- If department practices assigned time-record reviews to unit HR representatives, review records in a timely manner to ensure leave time taken is accurately recorded.
- Review standard HR reports to ensure payroll and salary information is accurate.
- Review appointments and payments already processed for employees to avoid duplication.
- Process terminations as soon as notified by supervisor, preferably before or on the date of termination.
- If an employee terminates unexpectedly on or between the monthly payroll cutoff date and the first of the following month, process the termination in HRIS immediately and contact Payroll Services immediately, as they may be able to pull back the ACH for that individual and adjust the paycheck they will receive on the first of the next month.
Undertime or Unpaid Leaves of Absence
- Several days prior to payroll cut-off each month, Payroll Services will send an email notice to supervisors and HR representatives regarding employees currently on an unpaid leave. Review the Leaves/Absence and Return Dates report in the Admin/Reports section to identify individuals on unpaid leaves of absence whose dates may need to be extended through the end of the month.
- If an employee is on an unpaid leave of absence and the department is not certain that the employee will return prior to the end of the month, extend the unpaid leave of absence to the third day of the following month.
- When an employee returns to work before scheduled and payroll cutoff has passed, departments should revise the return-from-leave date in HRIS and contact Payroll to request that an off-cycle check be processed for the employee for the time they worked.
- If there is less than a full day of unpaid leave and the employee will not receive a paycheck on the first of the following month, send a paper Electronic Time Report (ETR) for the employee to Payroll before payroll cutoff. This is done so that the undertime can be deducted from the employee’s next paycheck, ahead of when it would otherwise be deducted.
Change in Status
- Avoid retro-active changes in status if at all possible. Require that changes be approved the first of the month following the transaction being entered unless they can be entered prior to payroll cutoff in the month that the change in status occurred.
- Overpayments are not allowed on externally sponsored grants and contracts (funds 500/510). If an overpayment occurs for an individual who is appointed to an externally sponsored grant or contract, the related costs must be moved as soon as possible to an unrestricted funding source. Grant Accounting regularly monitors overpayments to ensure that costs are moved off as necessary. If, however, you are aware of an overpayment situation related to an externally sponsored grant or contract in your department, please notify the appropriate Grant Accounting so it can be removed promptly.
Direct overpayment questions to June Lester in Payroll Services, firstname.lastname@example.org or 319-335-2383.