It’s cash-out season for thousands of California state workers who have stacked up time in their paid-leave banks.
Starting May 1, non-union employees such as managers and employees in six bargaining units can apply to turn their time into money. The catch: Their departments have to pull the money from existing appropriations. No spare funds, no leave buy-backs.
Here’s who is eligible, according to memos posted on the state Department of Human Resources website today. The tax implications are detailed in this policy memo about unionized employees’ leave cash outs and this memo covering leave buy backs from excluded workers.
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Taking leave hours off the books makes financial sense for both the government and for taxpayers. Unused time cashed out at the end of an employee’s government service is paid at the rate of their final salary, so hours banked years or even decades earlier gain value as the worker’s pay rises – and increases the state’s liability.
The Legislative Analyst’s Office reported that leave cash-outs to separating state employees in 2011-12 had reached a “historic” $270 million. Furloughs and loose adherence to the state’s 640-hour cap on accrued leave, the LAO concluded, had increased the state’s obligations.
This is the second year in a row that the state has allowed some state employees to trade time for money. Labor contracts set the terms for organized employees and the administration decides when to extend the program to managers, supervisors and other employees excluded from bargaining. This year, roughly 70,000 employees are in one of the groups eligible for the program.
Call Jon Ortiz, Bee Capitol Bureau, (916) 321-1043.