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Payroll Services Letter 05-03.2: Back Pay Settlement Cases

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Payroll Services Letter 05-03.2: Back Pay Settlement Cases

Number: PS05-03.2

Date: September 12, 2011

Subject: Back Pay Settlement Cases

Category: Payments


Reference: PS 05-03.1, Back Pay Settlement cases, dated May, 2009. PS05-03.2 supersedes PS 05-03.1. Please replace that letter with this one.

Purpose

The purpose of this letter is to provide procedures for HHS Human Resource (HR) Offices when requesting payment of back pay settlement cases. The correct documentation and Service Center category are very important to ensure settlement cases are processed and disbursed properly and in a timely manner.

Note: Agreements that require correction of the employees HR and/or payroll record with the associated back pay based on those corrections are processed by DFAS. If the settlement agreement requires the payment of a lump-sum settlement only, it is not processed by DFAS. Agreements requiring the payment of lump-sum settlement amounts only should be forwarded to the agency’s servicing financial management office for payment.

_ _ _ _

Once the determination has been made that an employee is entitled to back pay under 5 U.S.C. 5596 and implementing regulations in 5 C.F.R. 550, the HR Office must prepare an official letter detailing the action and any special processing instructions.

A summary of the DFAS instructions concerning specific information that must be included in the letter, and supporting documentation required by DFAS is included at Attachment A to this letter.

The HR Office payroll liaison must forward the letter and all required documentation to their Payroll Customer Service Team electronically through the Service Center system.

Use the Service Center classification – Category SETTLEMENT. The Subcategory should be based on the type of settlement which includes:

  • Congressional
  • EEO
  • MSPB
  • MOU
  • Settlement Agreement
  • Union Agreement

The Service Center ticket must include the following information:

A statement indicating the type of agreement and a brief description of the action(s) that needs to be taken in order to comply with the agreement (i.e. back pay, leave adjustment, interest payment, etc). Include the due date for the action as stated in the agreement.

The PSD representative will bridge the Service Center ticket to the DFAS Cleveland civilian pay office and fax all letters and supporting documentation for back pay settlement cases to the DFAS Imaging system.

For further assistance or for questions regarding the information in this letter, please contact your Payroll Customer Service Team.

 

Appendix A

Information required by DFAS to process back pay settlement cases

The DFAS Civilian Pay offices require certain information and documentation before issuing payment to a civilian employee for back pay settlements, Merit System Protection Board (MSPB) settlements, Equal Employment Opportunity Commission (EEOC) settlements and/or other settlement/judgments.

  • Copy of settlement agreement, administrative determination, or order requiring the payment of back pay.
  • New, corrected or cancelled SF-50s. PLEASE SUPRESS FLOW OF SF-50s for offline periods through EHRP to Defense Civilian Pay System (DCPS). The payroll office will manually process any required actions for the off-line periods. An offline period is defined as anything older than 26 pay periods.
  • Election and/or cancellation forms for FEGLI, Health Benefits and/or TSP, if applicable.
  • If employee was unable to work during any part of the period involved, certification of the type and amount of leave to be charged.
  • Statement if unemployment benefits are to be withheld, with the dollar amount, address, and point of contact for the state unemployment office. Ensure that the employee understands that an offset of unemployment benefits against the award can reduce their award amount.
  • Statement that employee was counseled concerning FEGLI, Health Benefits and TSP.
  • Timecard, and/or corrected time and attendance records, if applicable, including overtime, night differential, shift premium, Sunday premium, etc., with number of hours and dates for each entitlement.
  • If back pay settlement was prior to conversion to the DCPS (April 17, 2005), a statement certifying any lump-sum payment with number of hours and amount paid and/or any severance pay that was paid with dollar amount.
  • Statement if interest is payable with beginning date of accrual. If the settlement cites 5 U.S.C. 5596 (Back Pay Due to Unjustified Personnel Action) the interest statement is not required.
  • Does the leave need to be restored? (Yes or No, if Yes, was leave previously paid as a lump-sum payment and is the employee willing to make the repayment?)

NOTE: Not all of these may apply and will depend on each specific situation.