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Provost and VPFA update OHIO on faculty pay modifications


On Wednesday, Executive Vice President and Provost Pam Benoit and Vice President for Finance and Administration Stephen Golding sent an email to all Ohio University faculty about faculty pay modifications.

This memo provides information about two changes that will affect faculty pay beginning in September 2012. The first change concerns the decision to switch from a monthly pay cycle to a semi-monthly cycle. The adjustment in pay cycles will allow the University to move over time from multiple pay periods (faculty, administrative, classified, student hourly, postdoctoral and graduate student teaching and research assistantships) to a consolidated approach to payrolls. Payroll consolidation offers the opportunity to increase functionality and reduce administrative costs.

To create a single pay-cycle in the future, employees now on a monthly pay cycle need to be transitioned to a pay period that aligns with the state’s minimum pay requirement for hourly employees. State law requires that hourly employees be paid at least semi-monthly.  

The second modification relates to the transition to a semester academic calendar. The change to semesters will result in an earlier fall term start date which will alter the timing of faculty pay distribution.

The move to semesters also will result in pay distribution changes for faculty who receive grant-funded summer salary. A memo addressing this subject will be distributed to faculty later this week.

In this communication we attempt to cover some of the basic issues stemming from the pay cycle and semester transition modifications. However, we anticipate that there may be questions. A link to a frequently asked questions webpage and a phone number to call for additional information and clarification is provided at the end of the memo.

Change in Pay Cycle
Under the quarter system, Ohio University pays full or part-time faculty on academic year appointments in nine payments during the academic year. Three equal payments are made for each academic quarter with fall quarter payments paid Oct. 1, Nov. 1 and Dec. 1; winter quarter payments paid Jan. 1, Feb. 1 and March 1; and spring quarter payments paid on April 1, May 1 and June 1.

Under the semester system, faculty on academic year appointments (nine months) will be paid 18 payments during the academic year. Nine equal payments will be made for each academic semester with payments paid semi-monthly on:

Fall Semester Spring Semester
Sept. 15 and 30 Jan. 31 
Oct. 15 and 31 Feb. 15 and 28(9)
Nov. 15 and 30 March 15 and 31
Dec. 15 and 31 April 15 and 30
Jan.15       May 15 and 311

In cases where faculty have chosen the 12 Month Pay Option, 24 payments will be paid semi-monthly beginning on Sept.15 through Aug. 31. The pay schedule follows:

Fall Semester Spring Semester Summer Deferred
Sept. 15 and 30 Jan. 31             June 15 and 30
Oct. 15 and 31   Feb. 15 and 28(9) July 15 and 31
Nov. 15 and 30 March 15 and 31   Aug.15 and 31
Dec. 15 and 31 April 15 and 30 
Jan. 15          May 15 and 31

Faculty who do not have appointments for a full academic year will be paid on a semester basis. Nine equal payments will be made for each academic semester and paid on the same payment schedule indicated above depending on which semester appointment is applicable (fall or spring).

Summer pay cycles under the semester calendar will result in three pays for each session as follows:

Summer Session I Summer Session II
June 15 and 30 July 31
July 15               Aug. 15 and 31

Implications of the Switch to Semesters
As a result of the semester transition, during calendar year 2012 only, faculty will receive a total of ten months of paychecks (six during January – June and eight during September – December) rather than nine months (under the quarter system). Faculty on the 12 Month Pay Option will receive a deferred salary payment, representing the last payment for academic year 2011-2012 (under quarters) on Sept.1, 2012, and the first payment(s) for academic appointments for 2012-2013 on Sept. 15 and 30.

As a result, most faculty on 9-month contracts will receive more income and hence greater tax liability on a one-time basis in calendar year 2012. If you have concerns about your tax liability, please consult with your tax accountant or preparer, as the University cannot provide personal tax advice.

Payroll Deductions

Health, dental, and life insurance as well as flexible spending account deductions will continue to be deducted over the 9 month academic appointment. For faculty members who select the 12 Month Pay Option this means that they will not have health insurance deductions from the deferred salary they receive over the summer months. The pay date range for these benefit deductions will start with the first academic pay for fall semester, Sept. 15, and will end with the last pay of spring semester, May 31.

The Athens campus parking fee will continue to be deducted over the 9 month academic appointment for both the 9 Month Pay and 12 Month Pay Options. This means that the parking fee will be deducted beginning with the first academic pay on Sept. 15 and the last parking fee will be deducted from the May 31 payment.

Retirement contributions (STRS, ARP, 403(b) or 457 plans) will be deducted from each pay. If you have selected the 9 Month Pay Option, retirement contributions will be deducted from each of the pays in the fall and spring semester term. If you have elected the 12 Month Pay Option, retirement contributions will be deducted from both the fall and spring semester pays as well as the deferred summer salary payments during the months of June, July, and August.

Deductions that are considered voluntary will be withheld from each pay (whether you have selected a 9 Month or 12 Month Pay Option). Voluntary deductions include, but are not limited to, contributions to United Appeal or United Way, contributions to the Ohio University Foundation, or additional amounts you may have withheld from your paycheck and transferred to the credit union. To illustrate, if you have elected to have $500 per year withheld and transferred to a savings account at the credit union the following amounts would be withheld from each pay:

  • 9 Month Pay Option: $500 per year/18 pays in the 9 Month Pay Option = $27.78 per pay
  • 12 Month Pay Option: $500 per year/24 pays in the 12 Month Pay Option = $20.83 per pay

Garnishments will be withheld from each pay (whether you have selected a 9 Month or 12 Month Pay Option). Examples of garnishments include child support or payments that Ohio University is required to withhold from an individual paycheck because of an order from the Internal Revenue Service or a court of law.

Questions

If you have questions about these changes please contact the Payroll Office at 593-1862. A frequently asked questions (FAQ) document is being created and will be posted on the main page of the Payroll Office website beginning Thursday, Feb. 23. The FAQ document will be continually updated so that a single point of reference is available for the payroll changes described in this memo. The url is: www.ohio.edu/finance/payroll/index.cfm.