Support Staff Policies & Procedures

Support Staff Compensatory Time Policy

Applies to the following Support Staff classified as non-exempt under the Fair Labor Standards Act (FLSA) and support staff entitled to receive overtime or compensatory time per a Collective Bargaining Agreement[1] or policy:

Policy

Departments may provide compensatory time at a time-and-one-half rate in lieu of overtime pay for non-exempt employees under the FLSA and/or exempt employees with contractual rights to time-and-one-half overtime payment in certain circumstances. The Support Staff Overtime and Time-Tracking Policy governs the payment of overtime. This policy and procedure governs situations in which compensatory time is substituted for overtime payment. Under the FLSA, this can be done only if certain conditions, which are set forth in this policy, are met.  Collective Bargaining Agreements (CBAs) may restrict the use of compensatory time or contain compensatory time benefits which exceed those in the FLSA and in this Policy and should be consulted by supervisors.

Combination time

A combination of overtime and compensatory time may be used. If an employee works, for example, 44 hours in a workweek, it is permissible for two of the hours to be earned as time-and-a-half overtime and two of the hours to be earned as time-and-a-half compensatory time. 

Flexible time – distinction

Compensatory time is different than “flex time.” For non-exempt employees, flex time may be used only to flex their working hours within a workweek. Flexible weeks are permissible under the FLSA as long as any hours over 40 are paid at time-and-a-half. Several CBAs further restrict the use of flexible time unless mutually agreeable.

Cap on time

An employee can accrue up to a maximum of 240 hours of compensatory time[2]; thus, any hours worked over 160 hours (which amounts to 240 hours of compensatory time, earned at a time-and-a-half rate) must be paid. Departments can set a lower cap on compensatory time.

Compensatory time payout

Employees terminating employment with the University or transferring to a new department will receive a compensatory time payout from the department in which they earned the compensatory time. The payout when moving to a new department will be at the employee’s current rate of pay.  The payout upon termination will be the greater of the employee’s current rate of pay or average rate of pay over the previous three years.

Compensatory time agreement

For non-exempt employees: prior to earning compensatory time, the supervisor and employee must mutually agree, in writing, to the compensatory time arrangement by completing the Agreement to Accept Compensatory Time in Lieu of Overtime Pay (“the Agreement”) .  If either the supervisor or the non-exempt employee wishes to revoke the agreement at any time, they must complete the revocation section of the Agreement. 

Using earned compensatory time

For non-exempt employees: an employee must request to take any earned compensatory time by giving his/her supervisor sufficient notice and the request should be granted by the supervisor as long as there is no undue disruption to the work.

 

Procedure

Reporting of compensatory time

Department: For covered employees, earned compensatory time must be reported in the HR/Payroll System through the EBS portal.  Used compensatory time must be reported in this system as well. To record compensatory time earned, departments should enter only the number of actual hours worked.  Refer to the Absence and Attendance Code Guide at https://hr.msu.edu /ebshelp/1placeforshared/absenceattendance.htm. The FLSA allows non-exempt employees to accrue a maximum of 240 hours of compensatory time (which reflects 160 overtime hours worked). The department may set a lower cap.

Compensatory time payout

When an employee terminates or transfers to a new department, the department in which the compensatory time was earned should report any remaining compensatory time using the Special Payments Authorization form

Supervisor Responsibilities:

  1. Be familiar with the University’s policies which govern overtime, compensatory time, hours worked and time reporting. Information and resources you will need are contained on the site: www.hr.msu.edu/flsa. 
  2. Know which of your employees are exempt and which are non-exempt (see the Overtime Eligibility and Time Tracking Chart) .
  3. Remind covered employees that they are responsible for knowing this policy and remind them of the importance of adhering to all policies and procedures.
  4. Ensure compensatory time is paid out upon transfer to a new department and upon termination. 
  5. Track, review and approve compensatory time earned and used on the employee’s timesheet.  Correct any erroneous or missed entries on a timely basis. 
  6. Enter and approve compensatory time when earned and used in the HR/Payroll System through the EBS portal (unless your unit time administrator handles this instead).
  7. For non-exempt employees:
    1. Ensure there is a signed agreement for substituting compensatory time prior to the time the work is performed.  The form entitled “ Agreement to Accept Compensatory Time in Lieu of Overtime Payment” needs to be completed and retained to document this agreement between the supervisor and non-exempt employee. 
    2. Maintain records of time sheets and other records created per this policy for three years.
    3. Because there is a cap on compensatory time for non-exempt employees, once employees reach that cap, they must be paid overtime for each additional hour worked over the cap.

Employee Responsibilities:

  1. For non-exempt employees: be sure to complete the form entitled “ Agreement to Accept Compensatory Time in Lieu of Overtime Payment ” if you would like to substitute compensatory time for overtime. 
  2. Adhere to all University policies, procedures and departmental rules related to time and attendance. 
  3. Report promptly any discrepancies or inaccuracies in compensatory time earned or used to your supervisor.

Unit Time Administrator:  Obtains the information from the supervisor (including the time tracking mechanism) to enter and/or approve compensatory time in the HR/Payroll System through the EBS portal when earned and used, if the supervisor does not. Completes Special Payment Authorization form when payout of compensatory time is required and submits to Payroll. 

MSU Human Resources: Reviews the Special Payments Authorization form for compliance with MSU policy and/or CBA’s, if applicable. After approval, the form is sent to the Payroll Office.

Payroll Office: Issues any compensatory time payout checks at the appropriate biweekly or monthly pay period.

NEED ASSISTANCE?

Questions related to this policy, contact MSU Human Resources at SolutionsCenter@hr.msu.edu or via phone at 517-353-4434.

Questions related to time reporting through the EBS portal, contact MSU Payroll at CTLR.Payroll@ctlr.msu.edu or via phone at 517-355-5010.



[1] This policy does not cover those non-exempt employees whose contract prohibits the use of compensatory time.

[2] The exception is that the maximum hours that may be accrued for fire and law enforcement personnel is 480 hours.

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