Payroll

To provide procedures that will insure conformity in the gathering of information and the eventual discernment of that information on a District-wide basis while efficiently employing the resources and time of the District’s employees.

These procedures will be in compliance with the objectives as stated in the Lone Star College System Policy Manual, Sections CAD (Local) and CDDA (Legal & Local). Other Sections may be referred to below or may be referred to specifically in the Supervisors Payroll Manual.

The scope of this section is to outline specific procedures necessary to accurately and timely process the payroll for the District. These procedures will identify and outline the specific functions to be performed, the regularity that those functions must be performed and the designated responsible individuals involved from both the College and District Business Offices. The following procedures will compliment the Supervisors Payroll Manual and the Payroll Desktop Manual. Certain specific procedures may refer the user to those manuals for more detail instructions.

Generally, the District Payroll Supervisor and the Vice Presidents of Administrative Services for each College are responsible for assuring that the payroll procedures are followed.

Specifically, they will work closely with the Payroll Assistants for each College. Detail payroll system setup and maintenance are assigned to the Payroll Assistants and these responsibilities are outlined in the Payroll Desktop Manual.

Some locations have designated a Human Resource Coordinator (HRC) to process the hiring of employees and other personnel related activities. This person has been specifically referred to in some procedures below. In the absence of this person, the Vice President of Administrative Services may appoint some other person (i.e. the Payroll Assistant) to perform those duties.

However, all Departmental Supervisors are responsible for the monitoring of their own employees and these responsibilities are outlined in the Supervisors Payroll Manual.

Lone Star College System Board Policy, Section CAD (Local) states: Pay day is scheduled bi-monthly on the fifteenth or the last work day prior to the fifteenth and the last working day of the month.

The District Payroll Supervisor provides a payroll calendar by month to all campus business offices. This calendar will specify all deadlines that need to be met in order for a payroll cycle to be run accurately and timely. References to this calendar have been dealt with in a more in-depth format in the Supervisors Payroll Manual and the Payroll Desktop Manual.

It is expected that all Departmental Supervisors will fully acquaint themselves with this calendar and will operate within its deadlines.

Important deadlines have been listed below. However, since deadlines and monthly calendars are subject to change, it is always prudent to consult with the current payroll calendar.

Employees for the District are defined by six (6) major types: Full-time, Part-time Hourly, Student Worker & College Work Study (CWS), Adjunct Faculty, Community Education Instructors (CE), and Substitute Pay. A detail description of each can be found in the Supervisors Payroll Manual.

There are, however, only two major types of payroll: Full-time and Part-time, into which all employees are assigned. Below is a list of the Earnings Types and Earnings Codes assigned to each type.

1. Employees can only be hired based upon a staffing plan previously approved and positions which have been set up in the Payroll system. These positions will already contain the Budget Code that the position is to be charged to and the anticipated salary placement in accordance with the Group/Band & Zone/Grade. The staffing plan is maintained by the College President and the Vice President of Administration.
   Please note - All changes to distribution codes require changes to both position records and individual employee records.

2. All employees hired are assigned to a position and an employee record is created. The information for the employee record is derived from the Personnel Action Request (PAR) form and the accompanying documentation required upon hiring. Different documentation and information is required depending upon the type of employee (i.e. Full-time, Part-time Hourly, Student Worker, etc.) hired. This is outlined in detail in the Supervisors Payroll Manual.
   Please note - Changes to wages require only a change to the employee record.

3. Employees hired under Grants have special considerations that must be met. Please refer to the Supervisors Payroll Manual for specific instructions.

4. Benefit deduction assignments to new hires from step # 2 above, must be made in order to complete the employee record. This is discussed under Benefit Deductions, below.

5. Changes to the status of an existing employee, including terminations, must be performed on a Personnel Action Request form. These changes include, but may not be limited to: Transfers, Promotions, Leaves of Absence, Disability, Worker’s Compensation due to an injury on the job, Budget Codes, Salary Placement, New Fiscal Year (for grants only), Salary, Length of Assignment, Address, Phone, Name, Social Security Number Corrections, Termination, Resignation, Retirement, Reduction in Force, Contract non-renewal, Discharges, Death.
   Please note - Transfers between departments involve the completion of two (2) PARs: (1) to ‘terminate from’ a department and (2) to ‘hire into’ another department.

6. All changes to an employee record require identification by one of the following: (1) Employee Number, (2) Social Security Number or (3) Last Name, First Name.

7. The deadline for submitting PARs to take effect on a given pay cycle can be located on the monthly payroll calendar for that pay cycle and is noted in the General Guidelines above.

8. All actual data entry (hires, changes and terminations) for Part-Time employees is made by District Human Resources and the District Payroll Office. Detail instructions for these procedures can be found in the Payroll Desktop Manual.

9. All actual data entry (hires, changes and terminations) for Full-Time employees is made by District Human Resources and the District Payroll Office. Detail instructions for these procedures can be found in the Payroll Desktop Manual.

1. Benefits are set up according to the documentation received with the PAR. Below is a partial list of the most commonly used Benefit Payroll and GL Account codes.

   Taxes and Levies	Payroll Code	Accounting Code
   Federal Income Tax	101	101-00-00101-2200
   Social Security	102	101-00-00102-2200
   Medicare	103	101-00-00103-2200
   IRS Levies	105	101-00-00105-2200
   Attachment	106	101-00-00106-2200
   Employee A/R	115	101-00-00115-2200

   Retirement Plans	Payroll Code	Accounting Code
   Teacher Retirement System(TRS)	107	101-00-00107-2228
   TRS Fee	108	101-00-00108-2200
   Part-time Pension	109	101-00-11109-2228
   Optional Retirement Plan (ORP)	351O-500O	101-00-00351(00500)-2230

   Savings Plans	Payroll Code	Accounting Code
   TDA	351A-500A	101-00-00(351-500)-2232
   Savings Bonds	110-113	101-00-00(110-113)-2239
   Credit Union	114	101-00-00114-2236

   Health Plans	Payroll Code	Accounting Code
   Health	241-252	101-00-00(241-252)-2237
   Dental	231-234	101-00-00(231-234)-2237
   AFLAC Acc/Dis	151-152	101-00-00151(00152)-2237
   AFLAC Cancer	153	101-00-00153-2237
   AFLAC Hosp	154	101-00-00154-2237
   AFLAC Inten Care	155	101-00-00155-2237
   Life 3 and 4	2391-2404	101-00-00239(00240)-2237
   Dependent Life	156	101-00-00156-2237
   Dependent Care	235	101-00-00235-2237
   Dependent Care Fee	236	101-00-00236-2237
   Health Care	237	101-00-00237-2237
   Health Care Fee	238	101-00-00238-2237
   Short Term Disability	255-256	101-00-00255(00256)-2237
   Long Term Disability	257-258	101-00-00257(00258)-2237
   Acc Death & Dismemberment	253-254	101-00-00253(00254)-2237

2. For changes or cancellations to Benefits and Deductions on an employee’s record, the employee must be identified by (1) employee number, (2) Social Security Number OR (3) Last Name, First Name, AND the number of the specific benefit to be changed, listed above.

3. The deadline for submitting changes as to benefit deductions to take effect on a given pay cycle is the same as the deadline for submitting PARs. It can be located on the monthly payroll calendar for that pay cycle and is noted in the General Guidelines above.

4. As above, all actual data entry (hires, changes and terminations) for Part-Time employees is made by District Human Resources and the District Payroll Office. Detail instructions for these procedures can be found in the Payroll Desktop Manual.

5. As above, all actual data entry (hires, changes and terminations) for Full-Time employees is made by District Human Resources and the District Payroll Office. Detail instructions for these procedures can be found in the Payroll Desktop Manual.

1. Bi-Monthly payroll originates from one (1) or more of the following eight (8) sources:
   

   Type of Payroll	How The Payroll Originates Into The Payroll System
   Full-Time Adm/Faculty	PAR sets up employee initially into the system for bi-monthly pay.
   Part-Time Hourly, Student Worker & College Work Study	Time Sheets are submitted to Business Office bi-monthly according to the monthly payroll calendar.
   Adjunct Faculty	Assignment to class generates Audit Report for Stipend Records. Manual overrides for changes only performed bi-monthly.
   Community Education Instructors	Assignment to class generates Stipend Records. Manual overrides for changes only performed bi-monthly.
   Coordinator Pay	Assignment to class generates Letter of Assignment and Stipend Records. Manual overrides for changes only performed bi-monthly.
   Faculty Overloads	Letter of Assignment is sent to Payroll Office at each location w/start and end dates of assignment.
   Special Stipends	Letter of Assignment for one time pay only is sent to Payroll Office at each location.
   Substitution Pay	Substitution Pay forms, with Leave forms attached, are sent to Payroll Office at each location according to the PT hourly schedule.

2. The above types of payroll must be completed and in the Payroll system by the deadlines set out in the Calendars and Timing Section noted in the General Guidelines, above.

3. Specific data entry and manual overrides to the above types of payroll are only perform by the Payroll Offices and details on each procedure can be found in the Payroll Desktop Manual.

4. On the fourth (4th) working day prior to pay day, the District Payroll Supervisor authorizes a preliminary calculation report for all pay for the upcoming pay day. This report is audited and adjusted for errors prior to the final printing of the Payroll Registers.

5. On the third (3rd) working day prior to pay day, the District Payroll Supervisor authorizes the final Payroll Check Register and Advise Register to be printed, along with Checks and Direct Deposit Advises. These procedures are detailed in the Payroll Desktop Manual. The blank checks and the signature diskette are kept in the vault prior to printing and are returned immediately after printing. Refer to more complete procedures below under Check and Direct Deposit Issuance Procedures.

6. On the second (2nd) working day prior to pay day, the District Payroll Supervisor authorizes the printing of the Direct Deposit Report and transmits the file to the Bank for dissemination to the employees’ bank accounts. Refer to more complete procedures below under Check and Direct Deposit Issuance Procedures.

7. On the day before the official date of pay, the paychecks, pay logs and direct deposit advises are sent to each location for distribution to the employees. The checks and advises are put into envelopes along with any other information to be given to the employees.

8. On payday, the checks and advises are distributed to the employees with the employees signing the pay log when the check is received. Any checks authorized to be mailed will be mailed by this date. The direct deposit will be posted by the bank.

9. The District Payroll Department will notify the Finance and Treasury Department of the Gross and Net Payroll amounts. Finance will transfer sufficient funds to the payroll disbursement account.

10. Checks unclaimed by the end of the day will be sent to or retained by the Business Office where they will be kept for two (2) weeks before being returned to District Payroll.

7.4.4 Check and Direct Deposit Issuance Procedures

1. Blank checks, deposit advises and the signature diskette are kept in the vault.

2. Starting check number and check date are assigned by the system and are verified against the ending number of the last print run. Checks are printed and the blanks and signature diskette are returned to the vault.

3. Starting advise number and advise date are assigned by the system and are verified against the ending number of the last print run. Advises are printed.

4. The check and advises registers are now printed and any errors that occurred during the printing will be taken care of.

5. The direct deposit file and report are created and the file is downloaded to the Local Area Network.

6. The bank is called with the totals for the deposit which will be transmitted. The file is then transmitted and the bank will notify of any problems.

7. Refer to steps 7, 8 & 9, above.

7.4.5 Manual and Void Check Procedures

This procedure is technically divided into three separate groups: (1) Manual checks for earnings not previously paid, (2) Manual checks that include voiding another check and (3) Checks voided without reissue.

Manual checks for earnings not previously paid:

1. If an employee’s pay is not included in a regular payroll, a manual check can be requested. This request should follow the procedures outlined in the Supervisors Payroll Manual and should include the following information:

   • Reason why the employee’s pay was not included in the regular payroll run.

   • Gross wages or hours and rate to be paid.

   • See a copy of this request at the end of this section.

2. Following proper approval by the VPAdmin at the location, District Payroll Supervisor and the Executive Director of Finance and Treasury, all manual checks will be cut three working days after payday and posted to the payroll system on the fourth working day after payday. However, if the error is caused by the District Office, a check will be cut immediately.

3. If the deadline for manual checks is missed, pay owed to the employee will be included in the following pay period.

4. If both of the manual checks and following payperiod deadlines are missed, the manual check will be cut three working days after payday.

Manual checks that include voiding another check:

1. As above, a manual check can be requested and this request should follow the procedures outlined in the Supervisors Payroll Manual and should include the following information:

   • Reason why the original check was in error.

   • Correct gross wages or hours and rate to be paid.

   • The original check to be voided. If the check was lost in the mail, a stop payment will have to be issued and a replacement can not be cut until the bank confirms the stop payment.

   • See a copy of this request at the end of this section.

2. Following proper approval by the VPAdmin at the location, District Payroll Supervisor and the Executive Director of Finance and Treasury, all manual checks will be cut three working days after payday and posted to the payroll system on the fourth working day after payday. However, if the error is caused by the District Office, a check will be cut immediately.

Checks voided without reissue:

1. Checks may be improperly issued for various reasons: system errors, classes canceled, not teaching of a class, terminations, etc.

2. The original check should be sent back to the District Payroll Department, immediately, to be voided.

7.4.6 Payroll Payables

1. Setting Up Of Vendors
   

   The Benefits Department requests to the Payroll Department to set up all vendors. The Purchasing Department assigns a Vendor ID number and the Payroll Department assigns a Payroll Code and a GL Account number. This information is submitted to the Accounting Department for activation. After activation, the information is set up into the Payroll system. Please refer to the forms section for a complete list of Payroll and GL Account Codes currently in activation.

2. Payment Of Vendors

   1. From the Deduction Register, the Payroll Department initializes all payments to Vendors according to the time frames outlined below.

   2. The Payroll Department inputs the payables into the Accounts Payable voucher system and prints a Voucher Register and a Voucher Summary.

   3. The Voucher Register and Summary are compared to the Payroll worksheet for balancing and the District Payroll Supervisor will verify totals and approve.

   4. The Voucher Reports are then submitted to the Accounts Payable Department and the checks will be printed.

   5. After the checks are printed, they are returned to the Payroll Department with a Sort Check List.

   6. The totals of the Sort Check List are compared to the Voucher Summary Report for balancing.

   7. A copy of the check is attached to a copy of the vendor back-up and filed in the vendor folder.

   8. The check and a copy of the back-up are mailed to the vendor.

   9. Requests for reimbursement from the State for ORP are made at the same time that the checks for matching are mailed to the Vendors and a receivable is created.

   10. Payment Time Frame

       Vendor Payment	Due Date
       Credit Union, Child Support	Immediately upon Pay Day
       Employee deductions for ORP & TDA and Levies	Two (2) days after Pay Day
       Savings Bonds, Insurances, TRS, ORP (State Matching)	Monthly, 5 days after the close of the month.

7.4.7 Payroll Tax Depositing & Reporting Procedures

1. Immediately upon pay, the Federal government requires the District to transmit payroll taxes due electronically via EFTPS.

2. At the end of each quarter, the District Payroll Supervisor prepares the 941, TEC and any other required reporting.

3. These reports are signed by the Chief Financial Officer for the District and are forwarded, as appropriate, with magnetic tape back-up.

7.4.8 Reports

The following registers are printed after each pay cycle: Payroll Summary, Check, Direct Deposit Advise, Manual/Void Check, Deduction.

7.4.9 Sick, Vacation, Comp Time and Other Leaves

1. Application For Vacation/Sick Leave
   To be filled out when full-time employees must be absent from work due to Vacation, Sick Leave (Personal Illness, Family Illness, Funeral, Personal Business), Leave Without Pay or Other Leave and forwarded to the HRC.

2. Request and Authorization for Leave of Absence
   To be filled out when full-time employees request Professional Leave time and forwarded to the HRC upon approval.

3. Employee Leave Summary Report
   The Supervisor will receive, on a monthly basis, an Employee Leave Summary Report from the HRC. Requests for Leave by the employee should be checked against this report. The Employee Leave Summary Report will show the accrued balance of sick/leave/vacation days owing to an employee. Questions concerning the method of accrual should be directed to the HRC.

Special Note: For requests for Leave Without Pay, the Supervisor must contact the College Business Office immediately for any leave without pay which occurs after the payroll cut off date.

4. The HRC inputs the hours into the Payroll system from the Application for Vacation/Sick Leave and Request and Authorization for Leave of Absence forms for pay corrections and accrual updates.

5. Non-Exempt Employees Hours Worked Summary Report and Compensatory Time Reporting Form (refer to forms at the end of this section)
   On a weekly basis, Supervisors will need to submit to the HRC a summary of all hours actually worked for all non-exempt employees only. Hours from this report will be entered into the HR system and will be used to track time compensated in lieu of pay. For further information, please refer to Section 4.4.7 of the Supervisors Payroll Manual.

7.4.10 General Ledger Interface and other Monthly Reporting

1. Following the close of each paycycle, the payroll summary register is posted. This posting will update all files, including the general ledger, that interface with the payroll, based upon ‘period ending date’, not ‘check date’.

2. Additionally, the employee history records will be updated.

3. Manual checks will be posted on the 4th working day following the close of the paycycle.

4. The following registers are printed after each pay cycle: Payroll Summary, Check, Direct Deposit Advise, Manual/Void Check, Deduction.

7.4.11 End of Quarter Reporting

1. Each quarter must be closed before any void/manual or regular payroll can be posted for the following month.

2. Since all adjustments for a quarter must be made to that quarter to insure that the taxes are withheld and reported correctly, it is important that any and all adjustments and changes be quickly communicated to the Payroll Supervisor.

3. When all adjustments have been posted, quarterly reports are run and printed.

4. Refer to the Payroll Desktop Manual for specific instructions.

5. Refer to Payroll Tax Reporting Procedures, above, for specific comments about quarterly P/R Tax Reports.

7.4.12 End of Year Reporting

1. To insure that wages, taxes and other deductions are reported correctly on each employee’s W-2 form, it is important that all adjustments be made as quickly as possible to the Payroll Ledger.

2. To all Supervisors, please remember that the District’s fiscal year end is August 31 but the calendar year end for wages is December 31. January, therefore, is the month when all adjustments must be cleared for the preceding year.

3. W-2 information is electronically transferred to the IRS with hard copies going to the employee for his/her personal filing.

4. Final calendar year end reports are run.

7.4.13 Record Retention

1. Five Years of Monthly, Quarterly and Annual reports are kept at the District Payroll Office.

2. All information is kept on tape back-up for ease of recall.

3. All other records are sent to the Records Department and are maintained according to Federal and State requirements.

7.5 Process Map

7.6 Forms

1. Personnel Action Request

2. Personnel Action Request - Short Form for Student Employees

3. Time Sheet

4. Application For Vacation/Sick Leave

5. Request and Authorization For Leave Of Absence

6. Employee Leave Summary Report

7. Non-Exempt Employees Hours Worked Summary Report and Compensatory Time Reporting Form

8. Request To Mail Paycheck

9. Check Distribution List

10. Substitute Pay Form

11. Grant Employee Worksheet

12. Example of Monthly Payroll Calendar