Important Upcoming Changes to Payroll Processing
Courtesy of the Finance Department
The County will be shifting to a 24 - pay deduction cycle for employee benefits from the current 26 - pay deduction cycle. This change pertains to benefits
only. Employees will continue to receive a paycheck every other Friday. Months with three paydays will no longer have deductions withheld from the third paycheck of the month. This change will align the County with the “ industry norm ” on how deductions are processed. Most employers only take deductions from the first two payrolls of each month to match the provider invoices. By deducting from all 26 payrolls, an administrative burden is placed on staff to manually reconcile each employee every payroll.
What does this mean for you?
If your current benefits have an employee deduction totaling $3,000 a year, you currently pay $3,000 / 26 = $115.38 a paycheck for these benefits. With this change, you will pay $3,000 / 24 = $125.00 a paycheck for 24 pays and receive 2 pays a year without any deductions taken from them in months that have three payrolls instead of two. The next month with three payrolls is October 2021. For the pay on October 29, you will not see a deduction for your employee benefits.
When does this begin?
These changes will happen in stages. Beginning July 9, 2021, VRS Retirement (including Hybrid voluntary contributions) and Deferred compensation plan contributions, will convert to the 24 - pay deduction cycle. On October 1, 2021, Medical, Dental, Vision, Optional Life, Voluntary Insurances, legal services, HSA, and FSA contributions will all covert. Items not impacted by this change that will remain on a 26 - pay deduction cycle include Federal and state withholding, Social Security and Medicare taxes, garnishments, child support orders, tax liens, and imputed group life.
Page 8 | July, 2021
Made with FlippingBook Online newsletter