City of El Paso

Employee Payroll Guidelines July 2020

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The mission of the Office of the Comptroller is to provide fiscal management and financial reporting, administer treasury services and provide grant accounting information to City Management and elected officials so that they can make informed decisions regarding the provisions of City services.

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Table of Contents

1.0 Introduction ....................................................................................................................... 4

2.0 Purpose .............................................................................................................................. 4

3.0 Payroll Processing Overview ............................................................................................. 5

3.1 Payroll Schedule ........................................................................................................... 5

3.2 Payroll Production Sources and References ................................................................. 5

3.3 Payroll Production Workflow ......................................................................................... 6

4.0 Form W-4 – Employee’s Withholding Allowance Certificate ............................................... 7

4.1 Completing Upon Hire ................................................................................................... 7

4.2 New Mexico Residents ................................................................................................. 7

4.3 Making Changes ........................................................................................................... 7

5.0. Direct Deposit Setup ......................................................................................................... 8

5.1 Employee Participation ................................................................................................. 8

5.2 Completing Upon Hire ................................................................................................... 8

5.3 Making Changes ........................................................................................................... 8

6.0 Gross Earnings, Payment Requests & Final Pay ............................................................... 9

6.1 HR Policies ................................................................................................................... 9

6.2 Kronos .......................................................................................................................... 9

6.3 Types of Earnings ........................................................................................................ 9

6.4 Retroactive Earning Adjustment .................................................................................. 10

6.5 Authorization of Payment Requests ............................................................................ 10

6.6 Final Pay ..................................................................................................................... 10

7.0 Deductions from Gross Earnings ...................................................................................... 11

7.1 Benefit Deductions from Gross Earnings .................................................................... 11

7.2 Miscellaneous Post-tax Deductions ............................................................................ 12

7.3 Wage Garnishments ................................................................................................... 12

8.0 Payroll Taxes ................................................................................................................... 14

8.1 Types of Taxes Collected ........................................................................................... 14

8.2 Taxable Income breakdown – See Appendix B ........................................................... 14

9.0 Employee Preview and Paystubs ..................................................................................... 15

9.1 Review Your Paycheck ............................................................................................... 15

9.2 View Paycheck ........................................................................................................... 15

10.0 Payroll Distribution ........................................................................................................... 16

10.1 Direct Deposit (ACH) .................................................................................................. 16

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10.2 Paper Check ............................................................................................................... 16

11.0 Off-Cycle Payroll ............................................................................................................. 17

11.1 Payment Method ......................................................................................................... 17

11.2 Replacement Check.................................................................................................... 17

12.0 Administrative Staff - Funding Payroll .............................................................................. 17

12.1 Gross Payroll .............................................................................................................. 17

12.2 Benefits and Taxes ..................................................................................................... 17

13.0 Year-end Statements ....................................................................................................... 18

13.1 Form W-2 .................................................................................................................... 18

13.2 Form W-2c .................................................................................................................. 18

Appendix A Definitions………………………………………………………………………………...19

Appendix B PeopleSoft Self-Service - W-4 Changes……………………………….………………20

Appendix C PeopleSoft Self-Service - Direct Deposit Changes…………………….……………. 21

Appendix D Taxable Income Calculation……………………………………………….…………….22

Appendix E PeopleSoft Self-Service - View Paycheck……………………………….……………..23

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City of El Paso Texas Employee Payroll Guidelines

1.0 Introduction

The City of El Paso (City) processes bi-weekly payroll for more than 6,000 employees annually. This document is a reference guide for both the employees and departmental staff who prepare payroll. Employees are encouraged to play a proactive role in the accurate production of their pay and it is the intention of these guidelines to assist employees to do so.

2.0 Purpose

The purpose of these guidelines is to define the City processes and responsibilities that should be consistently applied across all departments to timely and accurately produce net payroll. Because some components of payroll production are too detailed for these guidelines, references are made to direct employees to the appropriate staff who may provide assistance. While some departments are more involved with the processing of payroll than others, the successful completion of the payroll process involves staff from all departments. The Human Resources Department (“HR”) provides gross pay and benefit deduction details for the OTC-Payroll Section (“OTC-Payroll”) to calculate final net pay, distribute to the employee banking distribution choices, and record City costs in the general ledger. All departments must ensure that proper internal controls over payroll processes are established and enforced, so these responsibilities are accomplished. The instructions in this Employee Payroll Guidelines supersede all policies, procedures, memoranda, bulletins and guidelines previously issued by OTC- Payroll on this subject. These guidelines do not replace any HR Policies currently in effect. Payroll for El Paso Water employees is produced by El Paso Water staff under El Paso Water policies and procedures. All questions or conflicts with departmental policies or procedures may be directed to OTC-Payroll at (915)212-1177.

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3.0 Payroll Processing Overview This overview is general information employees may use to monitor their pay. It is not intended to cover all rules and policies that govern the payroll production process. Employees may contact the sources detailed in 3.2 or their Department HR for additional information.

3.1 Payroll Schedule

a. The pay week is a Sunday through Saturday week and two weeks of pay are processed each bi-weekly payroll.

b. Payroll is distributed on a bi-weekly schedule, 26 times per year, every other Friday. Note that every eleven years there is a 27th payroll.

c. If payday is a recognized holiday, payroll will be distributed one business day prior to the holiday.

3.2 Payroll Production Sources and References

a. HR administers citywide personnel policies and procedures, negotiates and administers collective bargaining agreements with labor unions, and advises the City’s departments in these areas.

b. HR issues memorandums that guide departments on human resource related topics that may affect payroll, such as work schedules, earning categories, leave accruals and usage, Workers’ Compensation and other related matters.

c. Department Payroll Staff - continually monitor Kronos for time stamps, supervisor approvals, etc…

d. Department Supervisors - must have all overtime and leave requests approved by 9AM

on the Monday of the week payroll is issued. (Deadlines subject to change when payroll is processed on a holiday Monday) e. The Payroll Division of HR (“HR-Payroll”) work’s with department payroll staff to monitor

and prepare accurate data. f. The Benefits Division of HR (“HR-Benefits”) administers benefit contracts that offer

eligible employees the opportunity to enroll themselves and eligible family members in medical, dental, vision, life, and disability coverage. HR-Benefits also administers contracts that allow employees to prepare for retirement through deferred compensation and pension plans.

g. The Payroll Section of OTC (OTC-Payroll) may be contacted for setup of W-4 (tax

withholding status and exemptions), Direct Deposit and Garnishments, for payroll payments not received or issues with financial institutions and for year-end statements.

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3.3 Payroll Production Workflow It is the responsibility of the employee to monitor their own earnings and leave balances in Kronos to ensure a successful payroll preparation.

a. To produce an accurate time card, the employee is responsible for monitoring their

time card in Kronos (i.e. time stamps, leave usage, etc.) b. Employee supervisors should be approving or disapproving requests (i.e. overtime,

leave requests) on a regular basis (if not daily, then multiple time per pay period). All requests must be processed by 9AM the Monday morning of the week pay is issued.

c. Unusual situations should be reported to department payroll staff. Employees and supervisors should not assume that the department payroll staff are aware of all situations.

d. Employees should alert their supervisor and/or Department HR when activity may lead

to inaccurate pay, i.e. missed time clock punches, unapproved leave, etc…

e. Department payroll staff are available to train employees on how to review their activity in Kronos.

f. Department payroll staff continuously review and correct Kronos time punches and

review schedules to provide HR-Payroll with accurate work activity.

Current pay period activity is reviewed.

As errors on prior payrolls are identified, retroactive adjustments are prepared for HR-Payroll to process.

Final review of the current payroll must be completed by 11AM on the Monday of the week pay is issued.

(Deadlines subject to change when payroll is processed on a holiday Monday)

g. HR-Payroll processes payroll data received from departments and ensures compliance with city, state, federal wage/hour regulations, employment agreements and collective bargaining agreements.

Current Kronos activity is loaded into PeopleSoft HR.

Additional Pay and Incentive Pay are loaded and/or confirmed.

Retroactive adjustments are applied to current payroll.

HR-Benefits processes benefit activity to be deducted from gross pay.

Current benefit deduction activity is loaded into PeopleSoft HR.

One-Time Benefit Plan Deductions and Refunds adjustments from prior activity are applied to current payroll.

h. OTC-Payroll

After HR process earnings and benefit deductions, OTC-Payroll deducts various post-tax deductions and the applicable taxes on wages. After these deductions are withheld, net-pay is calculated and distributed to the employees on payday.

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4.0 Form W-4 – Employee’s Withholding Allowance Certificate

4.1 Completing Form W-4 upon Hire – Federal

When hired, an employee must select their filing status, claim dependent credits and select other adjustments for calculation of Federal withholding tax. This does not apply to Social Security or Medicare taxes. a. Employees are provided a Form W-4 to complete.

b. The form W-4 version must be for the year the form is being completed (i.e. Form W-4

(2020)).

c. If no Form W-4 is received, employee will be set up as filing status Single with no adjustments.

4.2 Completing Form W-4 upon Hire - New Mexico

a. Whether an employee that is a New Mexico resident has New Mexico withholding tax collected or not, they must be on record as to what their decision is.

b. Employees residing in New Mexico when hired should complete an additional Form

W-4 to indicate filing status and number of exemptions for calculation of New Mexico withholding tax. “New Mexico” should be written at the top of the form.

c. The Form W-4 version must be for the year the form is being completed (i.e. Form W-4 (2020)).

d. Employee may choose not to complete Form W-4 for use with New Mexico taxes. If no

Form W-4 is received and no email informing OTC-Payroll is received instructing not to withhold New Mexico taxes, employee will be set up as filing status Single with 0 (zero) withholding allowances.

4.3 Making Changes after Hire a. There is no limit to the amount of times Form W-4 that may be updated by the

employee. b. Federal Form W-4 changes, after the initial paper Form W-4 is submitted, should be

made by the employee through PeopleSoft Self-Service (“PS Self-Service”).

c. New Mexico Form W-4 changes, after the initial paper Form W-4 is submitted, should be made by the employee by emailing OTC payroll at FinancialServices-Payroll@elpasotexas.gov, no form W-4 is required.

d. Employee that move to or from New Mexico after being hired should request a change

to their NM filing status by emailing OTC payroll at FinancialServices-Payroll@elpasotexas.gov, no form W-4 is required.

e. Changes in PS Self-Service illustrated in Appendix B.

mailto:FinancialServices-Payroll@elpasotexas.govmailto:FinancialServices-Payroll@elpasotexas.gov

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5.0 Direct Deposit Setup

5.1 Employee Participation

Per City Council, as of May 18, 2004: Resolution that the City Council of the City of El Paso hereby adopts to require Direct Deposit, in a financial institution of the employee's choice, as a condition of employment for all employees hired after July 1, 2004. That City of El Paso employees that are able to show hardship may be exempt from participation at the discretion of the City Comptroller. a. Employee must be named on the financial institution account (bank account) provided.

b. Money Card with acceptable routing number may be used in the same manner as a

bank account. c. Employees having to close a bank account should have a new account available for use

within two payroll cycles.

d. Employees not able to establish a bank account or obtain a Money Card may request consideration of a hardship situation by contacting OTC-Payroll (915)212-1177.

e. A Pre-Note process is ran between the employee’s bank and the City’s bank to

confirm the employee is on the bank account. This may delay direct deposits for up to two payroll cycles. A check will be mailed to the employees mailing address in employees’ profile in PeopleSoft HR until the direct deposit setup passes this process.

5.2 Completing Direct Deposit Enrollment Request Form upon Hire

Upon being hired, an employee must share their banking information for their net pay to be deposited. a. Employees are provided a Direct Deposit Enrollment Request Form.

A voided check or letter from the financial institution is required in order to use the account.

Deposit slips are not acceptable.

b. Net pay may be directed to more than one type of account (Checking/Savings) and/or more than one financial institution.

c. Net pay may be directed to selected accounts as a flat dollar amount. d. Employees may direct their net pay to as many as ten accounts.

5.3 Making Changes after Hire

a. Direct Deposit setup changes, after the initial paper request is submitted, should be

made by the employee through PS Self-Service.

b. There is no limit to the amount of times the direct deposit setup may be updated by the employee.

c. Changes in PS Self-Service illustrated in Appendix C.

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6.0 Gross Earnings, Payment Requests & Final Pay Earnings and incentives are calculated by HR to provide the gross earning totals.

6.1 HR Policies

HR Payroll Policies are followed to determine the gross earnings.

6.2 Kronos Kronos is the time and labor management software used to track time punches for non-exempt employees, work schedules for all employees, leave used, and remaining leave balances. a. Fire – Uniform Fire employees initially use TeleStaff time system to track time, which

is later uploaded into Kronos system. b. Police – Uniform Police employees initially use AgencyWeb time system to track time,

which is later uploaded into Kronos system. 6.3 Types of Earnings

In addition to regular and overtime earnings, the City issues a variety of other pay types. Some of the other pay types are listed below. a. Additional/Incentive pay are included in gross earnings for pay not related to time

worked. Some examples are: education/certification/license incentives, car, uniform, or tool allowances.

b. Wellness Incentives are included in gross earnings. Some examples are: WPB - Shape It Up Physical/Biometrics; WEL - Wellness Program (gym membership); WDT - Wellness Day Off-Taken; PAA – Perfect Attendance Award

c. Workers Compensation Coverage is a state-mandated insurance program that covers

lost earnings and medical treatment resulting from an employee’s work-related injury or illness, and helps employees recover and return to work.

Work related injuries or illnesses must be reported as soon as possible.

Report immediately, and if not possible, within 48 hours of incident

Report to supervisor, if available

When supervisor is not available, report to the department HR office.

The HR office will provide the supervisor and the employee with the details they need to record the injury or illness and to determine the appropriate course of action.

d. If employee is receiving Workers Compensation benefits, those benefits are distributed by the City’s Workers Compensation insurance administrative vendor. As of 9/1/2019, that vendor is Claims Administrative Services, Inc. (CAS).

e. If employee is receiving Accident With Pay (AWP) benefits, those benefits will be distributed through a payroll check on regularly scheduled pay days.

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f. Employee will receive a tax document from the Workers Compensation vendor at the

end of year, if payments were distributed to the employee.

g. In the event of an overpayment, amounts to be returned to the City will be collected with a deduction from gross payroll earnings.

6.4 Retroactive Earning Adjustment

a. When an employee requires an adjustment to earnings from prior periods, an adjustment will be made on the following pay cycle after the error is discovered. The department payroll clerk will submit a request to HR for processing.

b. Overpayment of prior earnings will be withheld in conjunction with the Overpayment

Recovery and Wage Deduction Policy.

6.5 Authorization of Payment Requests When an employee is found to have been under paid by an amount that is considered a hardship to the employee (i.e. more than $100), the Department Director may request HR to initiate an off-cycle payment rather than wait for the next pay cycle.

6.6 Final Pay

Final pay is prepared after an employee terminates and HR does a complete audit of the accrued leave and Workers Compensation files. (Sometimes referred to as Vacation Payout) a. Depending on the employee’s contract with the City, accrued leave balances are paid

out as per below:

Civilians - Vacation pay, up to 400 hours. This pay is not pensionable and it is taxable at the supplemental rate.

Police - According to Collective Bargaining Agreement, this pay is pensionable and it is taxable at the supplemental rate.

Fire - According to Collective Bargaining Agreement, this pay is pensionable and it is taxable at the supplemental rate.

b. Final pay may be reduced by Workers Compensation or Tuition Assistance Program amounts previously overpaid.

c. Pay due after an employee death may be assigned to a designated beneficiary. The

employee must have a signed Employees’ Designation for Facility of Payment In Case of Death on file with HR to have Final Pay paid to a beneficiary.

d. Employees are encouraged to review their Employees’ Designation for Facility of

Payment In Case of Death on file, and to update the form as life changes occur.

e. Beneficiary will be asked to complete an IRS W-9, as the net amount paid will be taxable to the beneficiary.

http://www.elpasotexas.gov/~/media/files/coep/human%20resources/overpayment%20recovery%20and%20wage%20deduction%20policy.ashx?la=enhttp://www.elpasotexas.gov/~/media/files/coep/human%20resources/overpayment%20recovery%20and%20wage%20deduction%20policy.ashx?la=en

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7.0 Deductions from Gross Earnings

Before the final processing of the net pay, HR-Benefits and OTC-Payroll set up various deductions that are paid by both the employee and the City. 7.1 Benefit Deductions from Gross Earnings

HR-Benefits administers benefit deductions/contributions for qualifying employees. Amounts are withheld from employee gross pay or contributed by the City via a payroll charge to the funding department. See the Appendix D for more details on the tax effect of benefits. a. Qualifying life events may effect benefit coverage (i.e. birth, death, marriage, divorce).

These events should be reported to HR as soon as possible, but no later than 30 days after.

b. Medical/Dental/Vision/Life/Disability Deductions

Deducted 2 times per month.

No deduction in third paycheck when three pay dates in the same month.

c. Pension Contributions

Deducted every payroll up to termination.

Not deducted from civilian final leave payout earnings

Deducted from uniform final leave payout earnings

d. 457 Deferred Compensation Plan contributions

Plan administrator is Prudential, as of 9/1/2019.

Changes to contribution amounts are made through the Plan administrator website.

It is the employee’s responsibility to know the various maximum pre-tax contribution limits (which change annually). The employee should contact the Plan administrator to confirm they will not exceed the annual limits. Exceeding annual limits may have tax consequences.

New employees are informed at New Employee Orientation that they will automatically be set up to have 1% contributed to deferred compensation. They have two weeks to opt out or they can change the contribution amount or percentage at any time, at the administrator’s website.

e. Fitness Memberships

EPFitness membership

Parks and Recreation Employee membership f. Tuition Assistance Program (TAP)

If TAP requirements are not fulfilled, the employee is provided a schedule of repayments to be deducted from future paychecks.

Amounts to be returned to the City will be collected with a deduction from gross wages.

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Should the employee terminate before repayments are completed, the remaining balance will be deducted from the employee’s final pay. Any balance remaining after final pay will be invoiced to the employee.

g. One-Time Benefit Plan Deductions and Refunds

When an employee requires an adjustment to benefit plan amounts deducted or due, an adjustment will be made on the following pay cycle after the error is discovered.

Underpayment of prior benefits will be withheld in conjunction with the Overpayment Recovery and Wage Deduction Policy.

h. Making Changes

Most changes to Medical/Dental/Vision/Life/Disability coverage may only be made at the Open Enrollment sessions held each November for the upcoming year. With the exception of 457 Deferred Compensation Plan, all other changes must be requested directly to HR-Benefits (benefits@elpasotexas.gov).

7.2 Miscellaneous Post-tax Deductions

OTC-Payroll administered miscellaneous post-tax deductions

Association Fees

Union Dues

Charitable Contributions – United Way

Wage Garnishments

Making Changes

Changes for association fees, union dues, and charitable contributions must be requested directly to OTC- Payroll (financialservices-payroll@elpasotexas.gov). Supporting documentation is required to begin a miscellaneous post-tax deduction. Changes for wage garnishments are outlined in the Wage Garnishments section.

7.3 Wage Garnishments

A wage garnishment (“garnishment”) directs the City to deduct money from an employee’s monetary compensation. a. Types of orders typically received, but not limited to:

Child support (from any of the 50 states, the District of Columbia and all U.S. territories and possessions) o Current support o Arrearage due o Medical coverage (administered by HR-Benefits) o A fee of $4.61 will be collected every pay period from employees having child

support withheld.

Spousal Support (may be found on child support order)

Bankruptcy

Student Loans

State and federal taxes

http://www.elpasotexas.gov/~/media/files/coep/human%20resources/overpayment%20recovery%20and%20wage%20deduction%20policy.ashx?la=enmailto:benefits@elpasotexas.govmailto:financialservices-payroll@elpasotexas.gov

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Other federal debt (i.e. AAFES, Veteran medical debt, etc…)

b. Receipt of Order – A court order is generally required for the deduction of the garnishment to begin, but some orders may be directives from federal and state governments.

The garnishment start and stop order must be received from the requesting agency, and not from the employee

Federal and state agencies may use a third party administrator for collection of a garnishment.

c. Priority – Wage garnishments for higher priority garnishments are deducted before wage garnishments with a lower priority garnishment. In general, support orders get priority over nonsupport orders, and a current support order gets priority over one in arrearage.

d. Prorating – Multiple garnishments of the same type will be calculated by the proration

method provided by the court. e. Disposable Earnings

Disposable Earnings are the amount of earnings remaining after gross earnings are reduced by certain deductions, pursuant to court order (i.e. taxes, mandatory pension, certain health, etc.).

Disposable Earning Limit – a percentage of disposable earnings that may be garnished, pursuant to court order.

Disposable Earnings adjustment may not reduce net pay below 50% for most child support orders

Disposable Earnings adjustment may not reduce net pay below 75% for most Federal and State support orders.

f. Child Support and Supplemental Wages

Supplemental wages are wage payments that are not regular wages (i.e. vacation payouts) and are referred to as a lump sum distribution.

Child support orders require that lump sum distributions over $500 be reported before the amount is paid out. If the employee has arrearages due, the agency will dictate how much to deduct to apply to the arrearages, not to exceed 50% of the net pay before the garnishment is deducted.

g. Employee Terminations

Texas Office of the Attorney General orders will be notified when employee terminates.

Garnishments will be deducted through final employee pay or until issuing agency stops the order.

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8.0 Payroll Taxes

The City of El Paso deducts payroll taxes from the employee’s pay and forwards to the appropriate agency. According to the tax, it may be paid by the employee and/or paid by the City. 8.1 Types of Taxes Collected

a. Social Security (OASDI – Old-Age, Survivors and Disability Insurance Program; also

referred to as FICA)

Social Security Administration sets percentage to withhold, the maximum amount of taxable gross to pay tax on, and employer matches.

Per federal regulations, some uniform employees are exempt from Social Security taxes.

b. Medicare (MED – Hospital Insurance Program)

Internal Revenue Service sets percentage to withhold, no maximum amount of taxable gross to pay tax on, and employer matches.

An extra percentage will be held if employee goes over annual limit and this percentage will not be matched by the employer.

Per federal regulations, uniform employees hired before 1986 are exempt from Medicare taxes.

c. Withhold (Federal and New Mexico) –

Withholding taxable gross pay is multiplied by a percentage that is based on filing status selections.

There is no dollar match by the City.

Vacation and sick leave payouts at termination are taxed at supplemental/lump sum distribution tax rate.

d. Unemployment Insurance – Employer paid tax on the total gross with no match by the employee.

8.2 Taxable Income Calculations – See Appendix D

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9.0 Employee Preview and Paystubs All City employees are responsible for monitoring the earnings, deductions and taxes being processed on their paycheck. 9.1 Review Your Paycheck

On the week that employees are paid, a notice is sent out that paychecks are ready to be reviewed on Monday afternoon or Tuesday morning. a. It is the employee’s responsibility to review their paycheck and notify the department

payroll clerk of any errors, as soon as possible.

b. Errors not found by payroll processing deadline will be corrected on the paycheck after errors are reported. c. PS Self-Service – paychecks may be previewed while payroll in process through

PeopleSoft Self-Services – Review Paycheck.

9.2 View Paycheck

After payroll is posted, the paycheck moves from Review Paycheck to View Paycheck in PeopleSoft Self-Service. a. View Paycheck may be printed as a paystub.

b. Year-to-date totals will only be populated on the most recent View Paycheck. Those

needing year-to-date totals may contact OTC-Payroll for copies with that detail.

See Appendix E for explanations of View Paycheck categories.

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10.0 Payroll Distribution 10.1 Direct Deposit (ACH)

a. It is mandatory that all City Employees have a domestic financial institution account (“bank account”) to deposit their net pay. b. Employees may direct their net pay to as many as ten (10) bank accounts. c. The Prenotification process with the employee’s financial institution is performed on all

new accounts entered to confirm that the employee is listed on the bank account. d. The employee will receive a paper check, mailed to their address on file in PS Self-

Service, until the Prenotification confirmation is completed (usually one or two pay periods).

e. Employees that do not establish a new bank account within two pay periods of

deactivating a prior one will be contacted by OTC-Payroll. f. If employee fails to establish a bank account for more than 2 pay periods in a row after

being contacted by OTC-Payroll, they will be reported to the Department Director. g. Employees out on extended leave, with no net pay due to them, will receive a paper

check to track their leave accruals.

10.2 Paper Check

a. A paper check will be issued until the Prenotification process with the employee’s financial institution is complete.

b. Paper checks will be mailed to the address on file in PS Self-Service and should arrive

by payday.

c. Paper checks that have not arrived in the mail by the Wednesday after pay day will be reissued, upon confirmation that the check has not cleared the City bank account.

d. Paper checks will only be handed to the employee (not mailed) if they are an off-cycle

check, a reissued lost check, or an approved case-by-case situation.

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11.0 Off-Cycle Payroll At times, it is necessary to issue a payroll check in between regular payrolls. These checks are Off-Cycle payroll checks. 11.1 Payment Method

Off-Cycle payroll is paid via a paper check, unless other direction received.

11.2 Replacement Check

If an off-cycle payroll check is replacing another payroll payment (ACH or paper), the first payment will need to be voided (Reversal) before the issuance of a replacement (Reissue). Confirmation that the first payment did not clear the bank (paper check) or the funds have returned to the City (ACH) must be made before reissuance may be processed. This confirmation may cause the turnaround time to be two business days.

12.0 Administrative Staff - Funding Payroll

12.1 Gross Payroll

Gross payroll is an expense to the department that the employee works for. a. An employee may be based out of one department but works for another, or for

multiple departments. b. The expenses are assigned to funding strings by combo codes. Funding strings define

the cost centers to be charged (i.e. City Council, Distr1)

c. Combo codes are assigned to positions and the positions may use more than one combo code, allocated by percentage.

d. Combo codes are requested by the department, set up by Office of Management and

Budget (“OMB”) and utilized by the department payroll clerks in Kronos.

e. Gross payroll is allocated to the appropriate funding via the combo code in Kronos feeding to PeopleSoft HR, and then on to PeopleSoft Financials.

f. Department payroll clerks should only update a combo code change in Kronos after

appropriate documentation to support the change is received.

g. A combo code error that results in a “No Budget Exist” error when the data is uploaded to PeopleSoft Financials will require approval by the Comptroller to override.

12.2 Benefits and Taxes

a. Benefits and taxes matched by the City will follow the same combo code logic as described in 12.1, for gross payroll.

b. All benefits and taxes will be forwarded to the appropriate agency by payday or the next business day after payday.

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13.0 Year-end Statements 13.1 Form W-2

Social Security Administration form W-2 is due to employees by the last business day in January. a. For active employees, form W-2 is provided to the employees through PS Self-Service

b. Form W-2 will be mailed to terminated employees, employees that transferred to El

Paso Water within the year, and municipal judges.

c. Additional copies requested by those already terminated or on extended leave are available to the employee in person, with identification, or mailed through the U.S. mail to the address on file. No year-end statement will be emailed or faxed.

13.2 Form W-2c

Form W-2c must be issued after the form W-2 has been issued and found to have an error on it. A form W-2c will be issued as needed.

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Appendix A

DEFINITIONS

Combo Code – A system-generated series of numbers that represent a particular Chart Field combination.

Direct Deposit (ACH) – An electronic transfer of net pay to employee’s bank account.

Final Pay – Paid to employee after termination and includes payment of leave balances (vacation or sick leave). Payment of leave balances are subject to terms of employment contract.

Form W-2: Wage and Tax Statement - Form used to report employee’s annual wages and taxes withheld from paycheck to employee, Social Security Administration (SSA) and Internal Revenue Service (IRS). Also, references amounts paid for before and after tax benefit deductions.

Form W-2c: Corrected Wage and Tax Statement – Form used to report corrections to annual Form W-2 to employee, SSA and IRS.

Form W-4: Employee’s Withholding Allowance Certificate – Form used for employee to indicate his or her tax situation to the employer (i.e. exemptions, status, state of residence, etc…)

Garnishment – A court or income withholding order directing employer to withhold amount from employee pay and forward to designated party.

Kronos – Time and leave management system used by the City which tracks time punches for hourly employees, work schedule setup for all employees, employee leave used, and available balances. The resulting data is uploaded into PeopleSoft HR. Uniform employees at the Fire Department use the TeleStaff system and at the Police Department uses AgencyWebb for initial time management. Then each of these system feeds into Kronos before data is loaded to into PeopleSoft HR.

On-cycle payroll – Payroll produced for all employees and issued every other Friday.

Off-cycle payroll – Payroll produced for individual employees in between regular (on-cycle) payrolls.

One-Time Benefit Adjustment - When an error in benefits deducted is found, a retroactive adjustment is calculated and applied the next pay period after error is reported.

Pay period – The recurring length of time over which employee time is recorded and paid. (i.e. City work week is Sunday-Saturday and employees are paid for two weeks of service (bi-weekly)

Payroll Advice – Detailed paystub with year to date totals. Employee may request if View Paycheck not sufficient.

PeopleSoft Self Service (“PS Self Service) – An individual employee’s gateway to personal profile and payroll history.

PeopleSoft HR (“PS HR”) - A computer operating system used to setup, track and pay City employees.

PeopleSoft Financials (“PS FS) – A computer operating system that applies payroll data to general ledger and compares to budgeted amounts.

Reissue – The replacement of a Reversed payment. Reissued amount may equal original issue or may be different due to needed adjustments.

Retroactive adjustment – When an error in earnings is found, a retroactive adjustment is calculated and applied the next pay period after error is reported.

Reversal –This process voids prior pay issued and removes that transaction from employee’s annual totals.

Supplemental Pay - Wages paid to an employee that are not regular wages (i.e. vacation leave balance payout, severance pay). Supplemental payments are subject to specific tax rates per IRS regulations.

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Appendix B

PeopleSoft Self-Service – W-4 Changes

To withhold additional amounts, you may:

If you are married, you may check Single and the

box below to have withholding calculated at higher

percentage

You may add an additional flat amount (no

percentages) for extra withholding to be added to

calculated amount (See 4(c)).

By checking box to claim exempt status, no Federal

Withholding will deduct from your pay.

If this box is erroneously checked, it may result in

tax penalties. Employees must research if it should

be checked, based on their personal history.

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Appendix C

PeopleSoft Self-Service – Direct Deposit Changes

Direct Deposit

Deposit Type:

Balance = After Amount accounts are

funded, all remaining funds are deposited

in Balance.

Add new account before deleting old account.

Deleting account will result in 24-hour delay before

making additional changes.

Some changes may result in paper

check mailed to address on file for

one or two pay cycles.

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Appendix D

Taxable Income Calculation

OASDI

Social Security*

MED

Medicare*

Withholding Federal Withholding

New Mexico Per PS

Self-

Service

Fed OASDI/EE Fed MED/EE Fed Withholding NM Withholding

ADD: Gross Earnings ADD: Gross Earnings ADD: Gross Earnings ADD: Gross Earnings ADD: Taxable Earnings

Not In Gross

(Car Rate Daily; Gift

Cards: Lean Six Sigma, U-

Matter, Wellness Incentive)

ADD: Taxable Earnings

Not In Gross

(Car Rate Daily; Gift

Cards: Lean Six Sigma, U-

Matter, Wellness Incentive) ADD: Taxable Employer

Paid Benefits

(Domestic Partner

Employer Portion;

Executive Life)

ADD: Taxable Employer

Paid Benefits

(Domestic Partner

Employer Portion;

Executive Life) LESS: Before-Tax Health

Benefits Deductions

(Health/Dental/Vision/Life)

LESS: Before-Tax Health

Benefits Deductions

(Health/Dental/Vision/Life)

LESS: Before-Tax Health

Benefits Deductions

(Health/Dental/Vision/Life)

LESS: Before-Tax Health

Benefits Deductions

(Health/Dental/Vision/Life) LESS: Before-Tax

Retirement Benefits

Deductions (Pension; 457

Deferred Compensation)

LESS: Before-Tax

Retirement Benefits

Deductions (Pension; 457

Deferred Compensation) Difference Fed OASDI

Taxable Income

Fed MED

Taxable Income

Fed Withholding

Taxable Income

NM Withholding

Taxable Income

*Some uniform employees are exempt from Social Security and/or Medicare Taxes

Tax definitions / Tax Withholding Matching & Percentages / Annual Limits

2019 and 2020

As

referenced in

PS

Self-Service

Other references Matched by

employer

Withheld

from

employee

Percentage to

withhold

Annual Limits

Fed

Withholding

Federal Income Tax

Withholding

No Yes Determined by Filing

Status and Exemptions

setup

None

Fed MED/EE Medicare; Hospital

Insurance Program

Yes

(non-exempt

employees

only)

Yes

(non-exempt

employees

only)

1.45% Additional Medicare Tax

of 9%; Threshold

Amount based on Filing

Status; Not matched by

employer

Fed

OASDI/EE

Social Security; FICA;

OASDI – Old-Age,

Survivors and Disability

Insurance Program

Yes

(non-exempt

employees

only)

Yes

(non-exempt

employees

only)

6.20% Maximum Taxable

Earnings

2019 - $132,900

2020 - $137,700

NM

Withholding

New Mexico Income

Tax Withholding

No Yes Determined by Filing

Status and Exemptions

setup

None

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Appendix E

PeopleSoft Self-Service – View Paycheck

View Paycheck :

General – employee’s identification number, address on file, work location, title and rate of pay.

Tax Data – employee’s chosen federal and state tax withholding tax setup

Paycheck Summary – summary of amounts contributing to net pay calculation

Earnings – summary of employee earnings, by type

Taxes – summary of employee paid taxes withheld to calculate total earnings paid

Before-Tax Deductions (“Pre-Tax”) – deductions subtracted from total earnings paid and the difference is the taxable income

After-Tax Deductions (“Post-Tax”) – deduction has no effect on taxable income

Employer Paid Benefits – benefits paid by the employer; may be entire benefit or partial amount

Net Pay Distributions – details of financial institutions direct deposit sent to or whether a check was issues.

YTD Totals – only appear on most recent payroll, a Payroll Advice may be requested by OTC-Payroll if past YTD totals are needed.

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