SUBJECT:

Administrative & Professional Staff (A&PS) and Staff Personnel Program (SPP) Policy Revisions

The designations of various A&PS and SPP job titles and policy provisions
related to hours of work and overtime have been updated to satisfy the
requirements of the Federal Fair Labor Standards Act (FLSA) effective May 1,
1994 (April 24, 1994 for employees paid on a biweekly basis.) Key
Administrators and affected employees have been notified that these changes
were anticipated through several campuswide notices distributed over the past
nine months.

Although the policies have been signed by President Peltason, and are
currently in effect, they have not yet been received by the campus for
issuance. We expect them within the next week and will be issuing them to
policy manual holders immediately. A list of exempt and non-exempt A&PS
and SPP titles will accompany the policy issuances. In addition, the Title
and Pay Plan will be revised to update the exemption status for each
payroll title affected. During this brief interim period, please refer to
the following notices to determine the exemption status of individual
titles:

  A&PS
  August 5, 1993 hardcopy notice (amended March 15, 1994 via
  electronic mail notice); and

  SPP
  February 16, 1994 hardcopy notice.

At this point we have notified managers of any newly non-exempt employees
in their departments who indicated they are unwilling to accept
compensatory time off at management's discretion as a term and condition of
employment. Department heads were advised that any premium overtime for
this group of employees was to be compensated in pay. Although Human
Resources served as a collection point for compensatory time off agreements
during the initial window period of conversion, departments must maintain
such agreements for non-exempt, non-exclusively represented employees from
this point forward. A model form will be distributed with the policy
issuances for your use.

The Payroll Department distributed a set of instructions regarding related
timekeeping changes to departmental timekeepers. Extramural Funds
Accounting will soon be issuing revised guidelines involving effort
reporting for employees working on contracts and grants. Please direct any
questions regarding timekeeping procedures to Pearl Trinidad,
extension 42061. Questions regarding contracts and grants effort reporting
should be directed to Emma Reyes, extension 41110.

What follows is a set of the most commonly asked questions and answers to
assist you in the administration of these new policies. In addition,
please feel free to contact Judy Johnson, Compensation Manager, at
extension 40986 or via electronic mail with any additional questions you
may have on these policy changes.

Rogers Davis Assistant Vice Chancellor Human Resources

       --------------------------------------------

QUESTIONS & ANSWERS
Regarding Implementation of A&PS and SPP Interim Policies
Pertaining to the FLSA

A.  COMPENSATORY TIME OFF (CTO) AGREEMENTS

1)  Q  Can employees change their mind once the CTO agreement has
been served and the terms become a condition of employment?

  A  Normally, conditions of employment do not change
frequently. Accordingly, it is intended that the CTO agreement will be
binding for a significant period of time. Parallel examples are the terms
and conditions maintained in the labor contracts which may be reopened for
review at contract renewal only. If/when an employee expresses an
interest in changing the initial CTO agreement, the individual's
circumstances should be reviewed on a case-by-case basis.

2)  Q  When an employee is transferred to a new department, does
another CTO agreement need to be completed?

  A  It would be desirable to review the previous agreement
in order to determine its continued applicability.

3)  Q  I heard non-exempt employees received a notice and form to sign
if they wanted premium overtime pay rather than compensatory time off at
the premium rate. I am non-exempt, therefore, why didn't I receive this
form?

  A  These notices and forms were only sent to employees in
the A&PS and SPP program whose status was changing from exempt to
non-exempt. The mailing list was based on the employee database in
March, therefore, new hires and reclassifications may have produced
additional employees in this category who were not previously
identified.

Employees who are represented by a union have language in their
collective bargaining agreements regarding how overtime is compensated.
Such provisions were agreed to by UC and the unions. Represented
employees are not free to enter into separate agreements with UC.
Additionally, any non-exempt, non-exclusively represented employees
employed by the University prior to the effective date of the FLSA for
public employers (April, 1986) are assumed to have accepted as a
condition of employment, management's discretion as to the method of
overtime compensation based on the policies that were in place prior to
FLSA coverage.

Supervisors should communicate with non-exempt, non-exclusively
represented employees hired after April, 1986 regarding their
willingness to accept compensatory time off in lieu of overtime pay
prior to the assignment of overtime and record their agreement if they
have not already done so.

4)  Q  As a non-exempt employee, am I entitled to compensatory time
off if the department prefers to compensate me with premium overtime
pay?

  A  No. The FLSA entitles non-exempt employees to pay,
unless the employee voluntarily agrees to accept compensatory time off.
However, there is no entitlement to time off if the employer elects to
pay. Your choice is either:

1)  agree that management has the discretion to decide the
   method of compensation (pay or comp time); or
2)  insist upon pay.

5)  Q  How will comp time agreements be secured for new employees?

A  Supervisors should communicate with new employees
regarding their willingness to accept comp time off as payment for
overtime, at management's discretion, as a term and condition of
employment in advance of the first overtime assignment. A record
of such an agreement should be documented in writing and
maintained in the department. There is a place on the job description
card to indicate employee acceptance of compensatory time off at
management's discretion as a condition of employment which may be used as
the record.

B.  NON-EXEMPT TIMEKEEPING

1)  Q  Some A&PS employees who changed from exempt to non-exempt
status are asking to have their previous hour-for-hour CTO banks changed
to time and one-half. Are there any circumstances under which such a
request would be honored?

  A  No. Before the non-exempt A&PS titles were
implemented, the University designated all A&PS titles as exempt, and
those titles were considered exempt for all practical purposes.
Therefore, CTO banks accrued on an hour-for-hour basis in accordance with
A&PS Policy 132.4 before the effective date of A&PS policy changes will
not, under any circumstances, be converted to time and one-half for
titles that are ultimately designated non-exempt. Previously accrued
hour-for-hour CTO banks will be maintained without modification for both
non-exempt and exempt A&PS employees for use or cash out at the
department's discretion.

2)  Q  Will there be two banks of overtime maintained for A&PS
employees who go from exempt to non-exempt status and who have
hour-for-hour CTO banks accrued before the change--that is, the
previously accrued banks and any premium time banks accrued after the
change?

  A  Two banks of overtime may be maintained for A&PS
employees who became non-exempt: 1) hour-for-hour banks accrued prior to
implementation, and 2) premium comp time banks accrued after
implementation. (The 240 hour maximum premium comp time accrual rate
will not apply to the two banks combined, but will apply separately to
each.) Departments will have discretion to either cash out CTO on the
books prior to policy changes, or to maintain it for the employee's use.

3)  Q  Define clearly what "suffering" someone to work means, as
expressed in the FLSA. How best can a department ensure that non-exempt
employees aren't working at home?

  A  It is most important to understand that "suffering"
someone to work is an FLSA "term of art" having broader meaning than
"permits" or "tolerates" an employee's working overtime.
For example, if a supervisor is aware that an employee is working
overtime but fails to take direct action at that time to tell the
employee to cease, the supervisor has effectively "suffered" the employee
to work. Likewise, if a supervisor accepts work performed on overtime,
even if the employee was instructed not to work overtime, the employee is
considered to have been "suffered" to work.

To avoid overtime claims for work at home, managers must communicate and
may document in writing that overtime for home work will not be
permitted. However, once again, even if such notice has been made,
acceptance of work done at home creates overtime liability under the
FLSA.

4)  Q  When employees are asked to stay overnight to supervise
students in the dorms, are they compensated for sleep time?

A  For exempt employees, sleep time is not compensable.
For non-exempt employees, the FLSA provides that sleep time is
compensable if the employee's "tour of duty" is less than 24 hours. If
the tour of duty exceeds 24 hours, up to 8 hours of sleep time may be
excluded from time worked if agreed to by the employee, and if sleep
space is provided and uninterrupted sleep is actually possible for at
least 5 hours.

5 ) Q  Am I required to pay premium overtime if my non-exempt employee
works 10 hours one day and then 6 hours the next so long as the total
hours worked in a workweek does not exceed 40?

  A  No. Employees on 40 hour workweeks only accrue premium
overtime after 40 hours of work per week, therefore, they are not
subject to daily premium overtime. However, you may not flex a
non-exempt employee's time between workweeks. An employee who
works 45 hours one week and 35 the next is subject to premium
overtime for the 5 hours of overtime in the first week.

The FLSA contains a provision for Hospital employees whereby they may be
placed on an alternate work schedule of 8/80. On an 8/80 schedule, any
hours worked over 8 in a day or 80 in a 2 week period is subject to
premium overtime.

6)  Q  I have by-agreement employees changing from exempt to
non-exempt status. Am I now required to keep records of hours worked?

  A  Yes. Even if they are paid a flat rate, the amount
must be no less than the minimum wage ($4.25/hr) when reduced to an hourly
rate, and any hours worked in excess of 40 per week must be compensated at
the premium rate.

C.  EXEMPT TIMEKEEPING

1)  Q  Will variable appointments be allowed to continue for exempt
A&PS or SPP employees?

  A  You are encouraged to eliminate formal variable time
appointments for exempt employees because such appointments may present
the appearance of hourly treatment. The preferred approach would be to
appoint an exempt employee at 100% or some lesser percentage fixed
appointment, understanding that as an exempt employee, the individual is
expected to work whatever amount of time (more or less) may be required
at different times to fully accomplish assigned duties. Under no
circumstances should hourly pay records be maintained for exempt
employees for purposes of receiving salary, nor should the salary vary
based on hours worked during the pay period.

2)  Q  Will FLSA changes have any effect on TRIP participation for
exempt (A&PS or SPP) employees? It would seem that exempt employees
could no longer participate in TRIP since the number of hours worked is
not supposed to be a factor.

  A  No effects are anticipated with respect to FLSA policy
changes and TRIP. TRIP is a temporary program only, and it is based on a
reduction in the PERCENTAGE of the participant's appointment and
corresponding overall work schedule rather than on specific hourly
timetables.

3)  Q  If an exempt employee has 2 hours sick leave balance and is
absent for 8 hours, can you reduce the sick leave balance to zero? Do
you pay the employee for the full day? Do you dock salary for 6 hours?

  A  Reduce the sick leave bank to zero and dock salary for
6 hours. The key point is that the exempt employee was absent for a
full day. The courts have expanded the concept of "salary deductions"
as including deductions from both salary and leave banks. It is
permissible to combine deductions from both--but only for full-day
absences. Absences of less than a full day should not result in any
leave bank or salary docking.

4)  Q  When an exempt employee is absent (assumed ill) for 4 full days
and there are 12 hours in the sick leave bank, how many hours are docked
from the employee's salary?

  A  Debit the sick leave bank for 12 hours and dock salary
for the remaining time (2 days, 4 hours). Thus: day 1 = 8 sick leave
hours; day 2 = a combination of 4 hours sick leave and 4 hours salary
docking; days 3 and 4 = salary docking for each full day.

5)  Q  For record keeping purposes, can negative balances be recorded
for exempt employees? If yes, what happens upon termination?   A  No, do not record negative balances. However, do note
in some manner the combined docking of leave balances and salary for
full-day absences as discussed in the previous two questions.

During an audit, this type of record keeping will serve to confirm that
docking was appropriate because the employee was absent for a full day.

6)  Q  Should jury duty be recorded hourly as administrative leave
with pay for exempt employees?

  A  No--leave for jury duty is specifically addressed in
FLSA regulations: "it shall not be recorded." It is permissible to record
it for non-pay purposes.

7)  Q  I was reclassified retroactively from a non-exempt to an exempt
title. What happens to the overtime I've been paid for during the
retroactive period?

  A  Although the reclassification to exempt status may be
retroactive, as established by the date the request was received in Human
Resources, the department would have treated you as an hourly employee
pending the outcome of the classification decision. Therefore, no
adjustment should be paid for overtime already paid, nor premium
compensatory time accrued.

8)  Q  I'm an exempt employee, yet required to keep records of my time
worked for recharge purposes. Is this a problem?

  A  Records of time worked may be maintained for exempt
employees for purposes other than pay. Recharge is one such purpose. In
addition, some exempt UCSD employees must maintain records of hours
worked pursuant to agency guidelines for contracts and grants, or for
productivity analysis purposes. As long as hours worked are not
submitted for purposes of calculating pay for exempt employees, this is
permissible. It is not appropriate for an exempt employee's salary to
fluctuate based on hours worked, however. Therefore, timekeepers must be
careful to ensure that hours reported for exempt employees on positive
time reporting matches the appointment percentage.

9)  Q  As a 60% part-time exempt employee, may I receive pay for
overtime hours up to 40 per week?

  A  No. Part-time as well as full-time exempt employees
are salaried at their appointment percentage. Just as full-time employees
do not receive additional compensation for overtime hours worked, neither
do part-time employees receive additional compensation for hours in excess
of their appointment percentage.

10)  Q  As an exempt employee, will I receive additional pay or comp
time off when assigned to work on a University holiday?

  A  No. Exempt employees do not receive any additional
compensation for holidays worked. It is appropriate for managers to
allow exempt employees who have to work on a holiday an alternate day
off, however.

11)  Q  Do exempt employees have to have their comp time banks paid
off as of May 1?

  A  It depends. Departments have been given discretion to
decide how to treat CTO banks for exempt employees. Comp time may
remain in the banks indefinitely, and be used by the employee to cover
absences of a full day, or comp time may be paid off at any time at the
discretion of management. Any comp time remaining upon separation will
be paid off. Remember that comp time is paid off at the rate in effect
at the time. Therefore, any payoffs of comp time while the Cut/CAP
program is in effect would be at the reduced rate.

D.  TRAVEL TIME

1)  Q  Do either exempt or non-exempt employees count travel time as
time worked?

  A  Exempt employees will not count travel time as time
worked. For non-exempt employees, certain travel time can be considered
hours as explained in interim A&PS Policy 132B.25-26, Travel Time, and
interim SPP Policy 315.23, Travel Time.

2)  Q  Will non-exempt employees be compensated for travel time not
during normal working hours when they are drivers, rather than
passengers, of a car?

  A  As provided in the policy sections cited in the
previous answer, time spent in travel time away from home and outside
normal working hours is not considered work hours, even when the employee
is required to drive their own car--UNLESS THE DRIVER IS REQUIRED to
perform other duties at the same time, such as carrying tools or
transporting passengers.

E.  MISCELLANEOUS

1)  Q  How do I report time and calculate overtime when an employee
has two separate positions where one is designated as exempt and the
other non-exempt?

  A  If 20% or more of the total time spent in a workweek is
considered non-exempt, then all hours worked for both positions must be
documented and premium overtime paid for any hours in excess of 40 per
week. If less than 20% of the total time spent in a workweek is
considered exempt, no premium overtime will be paid for either position.
Therefore, we are not encouraging combinations of exempt and non-exempt
positions. It is critical that where employees have multiple positions
in two different departments, that both departments are aware of the
overtime implications.

2)  Q  To what do the terms "exempt" and "non-exempt" refer?

  A  "Exempt" means exempt from the Premium Overtime and
Hours of Work provisions of the Fair Labor Standards Act (FLSA). Exempt
employees are salaried and pay does not fluctuate based on the quantity or
quality of work performed. "Non-exempt" means subject to the Premium
Overtime and Hours of Work provisions of the FLSA. Such employees are paid
on an hourly basis. Records of time worked per day must be maintained to
the quarter hour and premium overtime compensation is required beyond 40
hours or work per week.