OVERTIME AND COMPENSATORY TIME

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EXECUTIVE SUMMARY - OPPORTUNITIES FOR IMPROVEMENT The following is a summary of the content of the enclosed report. See report references noted below for full detail. Section A - Reporting on Overtime Information 1. County Administration made significant changes in the grouping and financial reporting of certain pay codes affecting overtime expenditures. These changes should be noted when dealing with reports for years prior to 2008. (Section A-1, page 4) 2. Overtime in most departments is relatively contained with the exception of the Prison and the Sheriff’s Department. Overtime at the Prison is the highest while the Sheriff Department’s overtime is the fastest growing among County departments. (Section A-2, page 6) 3. The County’s comp time was reviewed for a 5 year period. Overall, comp time hours earned and paid have increased significantly over the years. The cost benefit of this option must be weighed against the staffing demands to ensure that it does not drive up the cost of overtime for other employees. (Section A-3, page 8) 4. Our analysis revealed that there is a potential for cost savings by hiring new employees when there is a high enough volume of overtime for the department within job positions. Actual savings is dependent on many factors, however. The County would benefit from doing further analysis. (Section A-4, page 9) Section B - Internal Controls 1. To be in compliance with the County Records Manual and to have the necessary documentation available to verify actual time worked, the Prison should be retaining their records for three years. (Section B-1, page 11) 2. The County should seek reimbursement of overpayments of wages due to payroll errors. Proper implementation and use of scheduling software as well as the swipe card system at the Prison has the potential to alleviate their payroll errors. (Section B-2, page 12) Section C - Compliance 1. Creating a pay code for Release Time with the appropriate payroll rules will allow for proper recording and subsequent monitoring by supervisors. (Section C-1, page 14) 2. A policy should be put in place for comp time monitoring. Comp time should be recorded in compliance with the Employee Policies Manual to allow for proper monitoring by supervisors. (Section C-2, page 16) 1
INTRODUCTION The country is currently in a state of shrinking revenues and escalating expenditures. During times like these, overtime can become an increasing concern to many organizations. As with any organization, good management practices require that overtime be managed in the most cost-effective manner possible. Overtime is a balance between meeting the needs of the organization, addressing appropriate staffing levels, and assigning staff to work the necessary overtime. The County adheres to the Fair Labor Standards Act originally enacted in 1938 and has written Personnel Policies and collective bargaining agreements with those Federal guidelines in mind. Employees are compensated for their overtime by payment, usually at a premium rate, or by authorized time off in lieu of payment where specifically allowed. The County is currently in the process of implementing the SunGard financial, procurement and human resource/payroll software. This is the perfect opportunity to step back and analyze the current systems in an effort to improve upon the current limitations in processing payroll transactions. The Controller’s Office previously performed an audit of overtime and compensatory time dated August 15, 1996 for the calendar year 1995 and six months ended June 30, 1996. With a workforce of approximately 1,800 full and part-time employees encompassing 3 collective bargaining units, civil service and career service employees, total overtime costs amounted to $1,781,000 and $1,069,000, respectively. At that time, it was determined that an increased work force was not a viable option for reducing overtime due to the high cost of benefits. As of December 31, 2008, the County’s workforce was comprised of 2,152 full and part-time employees encompassing 11 collective bargaining units, civil service and career service employees with total overtime costs of $3,596,650 (as restated). The continual rise in overtime hours and the costs associated with overtime pay create a need to explore once again the cost benefits of hiring new employees versus current employees working overtime hours. 2
Page 1 and 2: Audit Report County Controller Step
Page 3: Table of Contents PAGE EXECUTIVE SU
Page 7 and 8: AUDIT RESULTS Section A - Reporting
Page 9 and 10: 2. Overtime Statistics by Departmen
Page 11 and 12: 3. Compensatory Time OBSERVATION Pe
Page 13 and 14: A committee will be put together to
Page 15 and 16: 2. Payroll Errors OBSERVATION Two p
Page 17 and 18: Section C - Compliance 1. Release T
Page 19 and 20: 2. Monitoring Compensatory Time OBS
Page 21 and 22: Policies that Boost Overtime Costs
Page 23 and 24: Prison Employee - 2008 Attachment 1

OVERTIME AND COMPENSATORY TIME

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