SECTION: HUMAN RESOURCES INDEX: C-25

SUBJECT: OVERTIME/COMPENSATORY TIME


POLICY

The policy of the University of Houston-Victoria (UHV) is to plan, organize, and schedule its activities so that work may be accomplished within the standard 40-hour workweek and overtime is limited to that which is absolutely necessary.  However, in unavoidable circumstances, such as peak load periods and emergencies, non-exempt employees will be compensated for overtime and extra hours worked in accordance with this policy and procedure.  Exempt employees may receive compensatory time if approved by their supervisor. Managers should plan staffing requirements to minimize overtime work.

This policy provides general guidelines to ensure compliance with the overtime provisions of the Fair Labor Standards Act (FLSA) and the State of Texas General Appropriations Act.  The provisions of this policy and procedure apply to all UHV staff employees, regardless of the source of funds.

DEFINITIONS

Compensatory time for non-exempt employees (or compensatory leave): Leave time earned in lieu of pay for time worked beyond the 40-hour standard workweek.  There are two types of compensatory time, with different restrictions:

• FLSA compensatory time (1.5 overtime):  Leave earned at one and one-half hours for every hour actually worked in excess of 40 hours in a workweek.
• Straight-time compensatory time (1.0 state comp. time):  Leave earned at the rate of one hour for every hour worked when hours actually worked during a workweek are 40 or fewer, but total hours for pay including paid leave and holidays exceeds 40.

Compensatory time for exempt employees (or compensatory leave):  Leave time that may be granted for additional work by regular, full-time exempt employees who are not eligible for overtime pay as prescribed in this policy.  To be eligible for compensatory time, an employee must perform the additional work under extenuating or extraordinary circumstances.

Non-exempt employee:  An employee in a position deemed non-exempt by the Fair Labor Standards Act and, therefore, subject to the overtime provisions of the FLSA. Non-exempt positions include office and clerical, or technical, service, and crafts and are paid biweekly on an hourly basis.

Exempt employee:  An employee in a position not subject to the overtime provisions of the Fair Labor Standards Act. Exempt employees include professionals, administrators, and executives and are paid monthly.

Overtime:  Hours actually worked over 40 in the standard workweek by a non-exempt employee.

Extra hours:  The hours in excess of 40, when hours actually worked during a workweek are fewer than 40, but total hours for pay including paid leave and holidays exceeds 40.

Overtime pay:  Cash payment for time actually worked in excess of 40 hours in the standard workweek by a non-exempt employee. (Compensation is at the rate of one and one-half times the employee's regular rate of pay for all overtime worked.)

Regular, full-time employee:  A university employee employed at 100% FTE for at least four and one-half continuous months, excluding students employed in positions that require student status as a condition of employment.

Standard workweek:  As defined  by the University of Houston System, the period beginning at 12:01 a.m. on Wednesday and extending through the seven day period ending at midnight the following Tuesday.

PROCEDURES

All full-time staff are required to work a minimum of 40 hours per week unless on approved leave status. Employees are required to work whatever hours are necessary to satisfactorily accomplish the job; the acceptance of such a requirement is a condition of employment for personnel employed in those positions.

All overtime and extra hours must be authorized in advance by the supervisor.  Non-exempt employees may not make unauthorized decisions to work overtime or extra hours. (see Attachment A)

Similarly, compensation for overtime or extra hours may not be waived by the non-exempt employee.

The supervisor of the non-exempt employee's department shall determine whether work in excess of the regular workweek will be compensated in compensatory time or cash.  The employee will be notified of the type of compensation prior to the performance of extra work.

Supervisors should monitor work hours of employees under their supervision and ensure that information reported on timesheets is complete and accurate.  This responsibility includes scheduling use of compensatory time by the employee.

COMPENSATION FOR OVERTIME-NON-EXEMPT EMPLOYEES

Non-exempt employees are subject to the overtime provisions of the Fair Labor Standards Act (FLSA) and must be compensated according to FLSA guidelines for all hours actually worked in excess of 40 hours (overtime) in the standard workweek.  Compensation to employees for overtime shall consist of either of the following:

• Compensatory time off (leave) at the rate of one and one-half hours for each overtime hour worked.
• Cash payment at the rate of one and one-half time their regular rate of pay for all overtime hours, in addition to the regular pay for the pay period during which it was earned.

Paid leaves and/or holidays taken are not counted as hours worked for purposes of determining overtime hours.  Only hours actually worked during that workweek are counted.

When the non-exempt employee is granted compensatory time under FLSA for overtime work, the following guidelines apply:

• An employee may not accrue more than 240 total hours of compensatory time for overtime hours worked.
• Accrued compensatory time must be taken during the 12-month period following the end of the workweek in which the overtime was worked.
• Any FLSA compensatory time not taken within 12 months or such compensatory time in excess of the 240 hour accrual maximum must be paid at a rate equal to one and one-half times the employee's current rate.
•  UHV has the option of paying off accrued FLSA compensatory time at any time.
• Accrued FLSA compensatory time must be paid to the employee upon termination.
• When an employee transfers to another position within the university, his/her compensatory time becomes the liability of the hiring department.
• When a non-exempt employee transfers to an exempt position, FLSA compensatory time must be paid by the transferring department at the time of the transfer.

COMPENSATION FOR EXTRA HOURS - NON-EXEMPT EMPLOYEES

In a situation where a non-exempt employee has not worked more than 40 hours in a workweek, but the total of hours worked and hours of paid leave and/or paid holidays exceeds 40 hours, the employee must be compensated for the excess hours over 40 by either of the following methods:

• Compensatory time off (leave) at the rate of one hour for each extra hour over 40 hours.
• Cash payment for the hours in excess of 40 on an hour-for-hour basis at the employee's regular rate of pay, in addition to the regular pay for the pay period during which it was earned.

When the non-exempt employee is granted straight-time compensatory time for extra hours over 40, the following guidelines apply:

• Straight-time compensatory time is subject to the limits defined in the section above:

240 hour maximum accrual limit
12-month period within which the compensatory time must be taken
Transferability of liability to the hiring department

• Under state law, employees may not be paid for any unused straight-time compensatory time.  Therefore, accrued leave beyond the stated limits will be forfeited, as it is if not taken within the 12-month period, or upon termination.

COMPENSATORY TIME - EXEMPT EMPLOYEES

An employee who is classified as either professional, executive, or administrative is exempt from the provisions of the Fair Labor Standards Act (FLSA) and is not eligible to receive overtime pay. Only under extenuating or extraordinary circumstances, may a regular, full-time exempt employee  be eligible to receive compensatory leave time for hours worked over 40 in the workweek at a rate not to exceed equivalent time.  The prior approval of the immediate supervisor is required.

Work performed under extenuating or extraordinary circumstances appropriate for granting compensatory time could include:

• Peak departmental operational period, i.e. student registration, end of year closeouts;
• Special project timelines;
• Special events, i.e. commencement, after hour student orientations, community related events, job fairs, etc.;
• Other extenuating or extraordinary circumstances approved by immediate supervisor;
• Operational emergencies, i.e. computer failure, telecommunication system failure, hurricane or severe weather related operations. Note:  The requirement for prior approval does not apply during operational emergencies.

Any exempt compensatory time granted must be used within the immediate 12-month period following the end of the workweek in which the excess hours were worked at a rate not to exceed equivalent time.  Compensatory time not used within the 12-month period will be forfeited.

An exempt employee's unused compensatory time may not be paid in cash under any circumstances, including the termination or death of the employee.  Compensatory time granted but not used is forfeited.

The interagency transfer of unused compensatory time is not authorized.

Each department will be responsible for keeping track of exempt compensatory time granted and taken.

NON-EXEMPT REPORTING OF ADDITIONAL WORK AND COMPENSATORY LEAVE TIME

Non-exempt employees shall report all additional work beyond the standard 40-hour workweek on the appropriate dates on the biweekly time and effort report, using the correct time reporting category.  Attach completed/signed original authorization for overtime to biweekly time and effort report. (Attachment A)

• 130 Extra Hours @ 1.0
• 315 Overtime @ 1.5
• 190 Comp Time Earned @ 1.0
• 300 Comp Time Earned @ 1.5

Extra hour and overtime pay will be added to the employee's pay for the time period in which it was accrued and reported.  The hourly rates for overtime pay will include the following:

• The hourly pay rate recorded in the payroll/personnel system
• Longevity pay, if applicable (prorated hourly)

State contributions for social security, retirement, and insurance benefits are not included in the calculation for the overtime rate.

When compensatory leave is taken, it must be reported on the timesheets accordingly:

• 195 Comp Time Taken @ 1.0
• 305 Comp Time Taken @ 1.5

Compensatory time earned and taken will be recorded in the university payroll system and updated and reported to the employee with pay information.

The payroll system will track compensatory time, and at the end of the 12-month period, FLSA compensatory time not taken will be calculated as pay and automatically added to the employee's paycheck.  Likewise, straight-time compensatory time not taken will be deleted from the employee's record automatically at the end of the 12-month period.

Approved by:

Signature obtained                          3/12/03
Dr. Karen S. Haynes                      Date
President

Originating department: Human Resources
Next review date: March 2005