8740 BILLING FOR SERVICES OF EMPLOYEES PAID ON MONTHLY BASIS
(Revised 12/07)
Below is the formula for determining hourly rates when departments bill for services of employees paid on a monthly basis on or after January 1, 2008. The number of hours to be deducted for Saturdays, Sundays, holidays, and the state contribution for staff benefits are provided. Vacation, annual leave, personal leave program, sick leave, bereavement leave, informal time off, jury duty leave, and military leave will be compiled and averaged by the department for this computation. Based on this formula departments will bill only for those hours actually worked 1/. However, the formula does not include an amount for such costs as identifiable operating expenses incurred in rendering the service, charges for other than incidental use of equipment, overhead, and other costs. Such costs will be included in billing for services in accordance with SAM Sections 8752.1 and 8758.
HOURLY BILLING RATE CALCULATIONS
CALENDAR YEAR 366 days x 8 hours 2928 hrs.
LESS DEDUCTIONS
Saturdays 52 days x 8 hours 416 hrs.
Sundays 52 days x 8 hours 416 hrs.
Holidays:
| January 1 |
1 |
1st Monday in September |
1 |
| 3rd Monday in January |
1 |
2nd Monday in October |
1 |
| February 12 |
1 |
November 11 |
1 |
| 3rd Monday in February |
1 |
Thanksgiving Day |
1 |
| March 31 |
1 |
Friday following Thanksgiving |
1 |
| Last Monday in May |
1 |
Deccember 25 |
1 |
| July 4 |
1 |
Personal Holiday |
1 |
14 days x 8 hours = 112 hrs.
Other Absences
Vacation/Annual Leave Taken (average) *
Personal Leave Program (PLP) (average) *
Miscellaneous - Sick, Bereavement, Informal Time Off *
Jury Duty, Military (average) _______
Subtotal Vacation PLP, and Miscellaneous Absences _______
TOTAL DEDUCTIONS (include all amounts calculated under Deductions)
TOTAL ACTUAL WORKING TIME PER YEAR
*Statewide data are not available. Each department, based on previous experience and expertise, must compile the information for Other Absences. Remember to calculate a seperate average for each type of Other Absence (i.e., average vacation/annual leave, average PLP, and average miscellaneous absences.)
TOTAL ACTUAL WORKING TIME PER YEAR1/ (2928 hrs. less "Total Deductions")
TOTAL ACTUAL WORKING TIME PER MONTH2/ ("Total Actual Working Time Per Year" divided by 12)
STATE'S STAFF BENEFIT CONTRIBUTION PERCENTAGES (effective January 1, 2008)
| Employee's Retirement |
16.63 |
| OASDI |
6.20 |
| Medicare |
1.45 |
| Health, Vision, and Dental Benefits |
10.82 |
| Total Percent |
35.10 3/ |
FORMULA FOR CALCULATING HOURLY BILLING RATE:
Monthly Salary Rate x 1.3510 = Hourly Rate
Total actual working time per month
1/ Workers' Compensation, Industrial Disability, Unemployment Compensation, and Life Insurance benefits are not included as factors in the formula for computing hourly billing rates in this section since these expenses can vary substantially among departments. However, departments will include Workers' Compensation, Industrial Disability, Unemployment Compensation, and Life Insurance benefits in billing for services in accordance with SAM Sections 8752.1 and 8758.
2/ The number of working hours per month is not appropriate for employees not expected to work 2,000 hours per year, less vacation and sick leave, such as college instructors. In such instances, an estimate of actual working time per month or year, considering average holiday, vacation, and sick leave, should be used. For example, billing rates for academic year employees would be computed on the basis of the number of workdays in a year, less the average of sick leave usage. (Holidays and vacation are not considered in this instance since they are considered in determining the number of working days.)
Formula: Annual Salary Rate x 1.3510 3/ = Daily Rate
Working Days per Year - Average Sick Leave Days Used Per Year
or
Daily Rate 3/ = Hourly Rate
8
3/ The 35.10 percent rate is applicable only to employees who are Miscellaneous Tier 1 members of the Public Employees' Retirement System. For those employees who are not Miscellaneous Tier 1 members, but who still belong to Social Security, their appropriate retirement contribution rate will be substituted for the 16.63 percent rate. Those employees who are not Miscellaneous Tier 1 members and who as a group do not belong to Social Security will include their appropriate Medicare and retirement rates, and health, vision, and dental benefit rates. For example, the appropriate total rate for members of the Safety Retirement Category who do not belong to Social Security is 31.11 percent consisting of: (1) 18.84 percent for retirement contributions from the appropriations of the employing departments, (2) 1.45 percent for Medicare, and (3) 10.82 percent for health, vision, and dental benefits. This 31.11 percent figure will be used in lieu of the 35.10 percent figure shown above. State departments with employee members in different retirement categories may use a composite employer contribution rate, based on department experience. Also, any department may use other rates for OASDI, Medicare, and health, vision, and dental benefits if more accurate rates can be determined from the actual experience of their operations.
