Purpose

To inform agencies of the availability of Control-D report NPAY779 (Merit Step Eligibility Listing) that lists potentially eligible employees for the Merit Step payment and to provide instructions for submitting transactions for eligible employees. OSC is no longer automatically processing this payment.

Affected Employees

Merit Step eligible employees in Bargaining Units 05 and 67 with a Pay Basis Code of ANN

Effective Date(s)

October 2008 Merit Step payments for PEF employees are effective:

• September 25, 2008 for Institution
• October 2, 2008 for Administration

October 2008 Merit Step payments for RRSU employees are effective:

• October 2, 2008 for Administration

Job Action Requests may be submitted beginning in Pay Period 15L (Administration) or 15L (Institution).

Background

Chapter 114 of the Laws of 2008 and the 2007-2011 negotiated agreement between the State of New York and the Public Employees Federation provide for the payment of a merit step to eligible PEF employees.

Chapter 49 of the Laws of 2008 and the 2007-2011 negotiated agreement between the State of New York and the Rent Regulation Services Unit provide for the payment of a merit step to eligible RRSU employees.
After an employee receives a Merit Step payment, the merit step becomes part of the employee’s base salary.

An employee’s Geographic Pay Differential is not reduced by the amount of the Merit Step payment (see Payroll Bulletin No. 721).

Eligibility Criteria

To be eligible for the Merit Step payment, employees must satisfy all of the following criteria:

1. One (1) complete year of service at the Job Rate of the salary grade.
   • One (1) year of service is defined as 26 pay periods and does not need to be continuous.
   • Job Rate in a higher graded or NS equated to grade position (on the NYS Position page) counts toward Job Rate service in a lower grade.
   • Lateral Transfers: If the bargaining unit changes on a lateral transfer but the employee remains at the Job Rate (or higher), the service will count toward the Job Rate service.
   • Full pay periods of Sick Leave with or without Pay will not count toward the Job Rate service.
   • Promotions/Reclassifications: Employees will be considered for advancement to the merit step of the new grade after completing one (1) year at Job Rate in the new grade payable on the next appropriate pay cycle. Note: One (1) full year in the higher grade must be completed before consideration of the Merit Step payment even if the increment code did not change because of the Job Rate to Job Rate rule.
   • Merit Step payment rules for demotions will be identical to Longevity Lump Sum payment rules as described in Payroll Bulletin No. 623:
     • An employee who is not eligible for the payment becomes eligible if the employee returns to a lower graded position between October 1, 2008 and September 30, 2009, provided the employee otherwise would have been eligible if the employee had been in the lower graded position at the time of payment and remained in the lower graded position for at least six (6) pay periods; and
     • The promotion was temporary and the employee has been reinstated to the employee’s previous position or has been appointed to another lower graded qualifying position; or
     • The promotion was permanent, but the demotion occurred:
     • in lieu of layoff; or
     • voluntarily during the probationary period; or
     • as a result of failure of a probationary period.
   • Upward Reallocations: Employees who were reallocated to a higher grade will be treated as if the employee was in the higher grade for the time rendered in the lower grade.
2. Five (5) years of cumulative State service.
   • All service counted toward the one (1) year at Job Rate criteria described above will also count toward the five (5) year criteria.
   • Sick Leave with Pay will count toward the five (5) year criteria.
   • Employees with more than a one (1) year break in service who are rehired with one of the following Reason codes are eligible to use the service prior to the break to satisfy the five (5) year cumulative service criteria:
     • RCM (Reinstate Civil Service Commission Action)
     • RDR (Reinstate Court Order Directive)
     • PRF (Preferred List)
     • RER (Reinstate Roster)
     • RFD (Reinstate Disability)
     • 713 (Reinstate Disability)
3. “Satisfactory” performance evaluations for the previous three (3) years.
   • “Unsatisfactory” ratings given during that period and subsequently reversed on appeal will satisfy this criteria.
4. No finding of guilt in any Notice of Discipline (NOD) for the previous three (3) years. It does not include NODs dismissed by an arbitrator or withdrawn by the agency during that period, but it does include NODs that are settled or are pending resolution during that period.
5. The employee has taken advantage of agency sponsored job-related training opportunities during the previous three (3) years.

Additional Payment Criteria:

• Employees must have a Pay Basis Code of ANN.
• PEF employees must be in grade 4 or 7 through 18 or NS equated to grade 4 or 7 through 18 (on the NYS Position page) but must not have a value in the Approved Salary field.
• RRSU employees must be in grade 18 or NS equated to grade 18 (on the NYS Position page) but must not have a value in the Approved Salary field.
• Employees must be Active, on Paid Leave of Absence or on Workers’ Compensation Leave.
• Employees may be full or part-time.
• Employees must be in the qualifying position on the effective date of the Merit Step payment.
• Service performed in the following will not count toward the eligibility criteria:
  • Thruway Authority
  • Teachers’ Retirement System
  • Dormitory Authority
  • SUNY Grade 980 positions
  • HRY, FEE, or BIW pay basis codes (excluding paid Military Stipends)
  • Office of Court Administration payrolls
  • CUNY payrolls
  • Legislative payrolls
  • Judicial payrolls

Agency Review of the Merit Step Eligibility Listing

Control-D report NPAY779 is available as of September 2, 2008.

NPAY779 is available for agency review and lists employees who appear to meet eligibility criteria #1 and #2 above. Agencies must review employees on this report to verify eligibility criteria #1 and #2 are met and determine whether employees meet eligibility criteria #3, #4 and #5.  To assist agencies with determining whether an employee meets all eligibility criteria, the effective date of an “Unsatisfactory” rating reported to OSC and the effective date of a promotion within the last calendar year will be included on the report.

While some employees are not eligible to receive the Merit Step payment on the effective date due to their employee status, do not appear eligible for the payment due to their salary or no longer work in the specified agency, all employees must be reviewed to determine eligibility on the effective date of the payment including employees in the following circumstances:

• Employees on a Leave of Absence (including Workers’ Compensation Leave)
• Employees on a Paid Leave of Absence (including Sick Leave and Military Stipend)
• Employees whose current salary is at or above the merit step

Employees previously deemed ineligible to receive the Merit Step payment and who appear on the current NPAY779 must be re-evaluated to determine if the employee meets the criteria for the October payment.

The eligibility status of employees who transfer to another agency must be communicated to the new agency.

Potentially Eligible Employees Who May Not Appear on the Control-D Report NPAY779 But Must be Reviewed

• Employees with multiple Job records which, when combined, may result in five (5) years of cumulative service.
• Employees who may meet eligibility criteria #1 and #2 but the requirement of five (5) years cumulative State service is pre-PayServ due to a break in service.
• Employees in all bargaining units with Increment Code 2222 representing composite salaries who may be eligible to receive the Merit Step payment in either portion of the employee's composite salary.
• Employees with a job change entered after the NPAY779 was created but prior to the effective date of the Merit Step payment.
• Reallocations:
  • Upward – Employees occupying a position that has been previously reallocated, whose salary was equal to or greater than the Job Rate of the lower grade (Increment Code 0710 or earlier) and whose salary upon application of the October 2008 Performance Advance will reach the Job Rate of the higher grade will have their Increment Code automatically updated from 1001 to 0810. While entitled to Job Rate credit from the lower grade, these employees will not have the correct increment code year for payment.
  • Downward – If the position was downward reallocated (as indicated by Increment Code 0069), the employee holds the salary of the prior grade and all future payments must be based on the prior grade. Therefore, the Merit Step payment can only be paid if the prior grade is eligible to receive the payment.

Agency Instructions for Submitting Payments

Beginning in Pay Period 15L (Administration and Institution), agencies must submit transactions through the Job Action Request page using the Action/Reason code of PAY/MST (Pay Rate Change/Merit Step), the effective date of the payment, and the employee’s current increment code and anniversary date for all eligible employees, including:

• Employees on Workers’ Compensation Leave
• Employees on a Paid Leave of Absence (except Military Stipend)
• Employees whose current salary is at or above the merit step to indicate the employee meets all eligibility criteria but is not entitled to any additional monies
• Eligible employees not appearing on the NPAY779
• Employees in a reallocated position who also require an updated increment code to reflect the increment code in effect prior to the reallocation

Employees on Leave of Absence on the Payment Effective Date

Employees on a Leave of Absence (except Workers’ Compensation Leave) on the payment effective date who subsequently return to Active status must have a Job Action Request submitted using the Action/Reason code of PAY/MST (Pay Rate Change/Merit Step), the effective date of the return and the appropriate increment code and anniversary date.

Note: Agencies must use the Action/Reason code of PAY/CSL (Pay Rate Change/Correct Salary) when submitting transactions for employees with Increment Code 2222 representing composite salaries.

BU05 Employees

The requested salary should reflect the appropriate merit step for employees whose current salary is equal to or greater than Job Rate and less than the merit step for the employee’s grade.  If an employee’s current salary is equal to or greater than the merit step, a PAY/MST transaction must be submitted using the employee’s current salary.

BU67 Employees

The requested salary should reflect the appropriate merit step based on the number of longevities the employee is holding.  If an employee’s current salary is equal to or greater than the merit step the employee is currently eligible to receive, a PAY/MST transaction must be submitted using the employee’s current salary.

Agencies must submit requests to update the salary of subsequent rows using the Action/Reason code of PAY/CSL (Pay Rate Change/Correct Salary), if applicable.

If an agency does not submit a Merit Step payment because an employee is deemed ineligible and later determines that the employee met all of the eligibility requirements as of the effective date (due to a change in Performance Evaluation, NOD or training), the agency must submit the Merit Step payment through the Job Action Request page retroactive to the effective date of payment.

Example:
An employee received an Unsatisfactory Rating (USP) for 6/30/08 that was rescinded after the effective date of the payment.

Agency Instructions for Rescinding Payments

If a Merit Step payment is submitted for an employee and the agency subsequently determines the employee is not eligible, a transaction must be submitted through the Job Action Request page using the Action/Reason code of PAY/RMT (Pay Rate Change/Rescind Merit Step).  The transaction must be effective on the original date of the Merit Step payment and must reflect the salary in effect prior to the Merit Step payment.

In addition, agencies must submit requests to update the salary on subsequent rows using the Action/Reason code of PAY/CSL (Pay Rate Change/Correct Salary), if applicable. 

The Status Reason section of the Job Action Request page and General Comments must include the reason for rescinding the Merit Step payment and a statement that the overpayment is non-recoverable.

Questions

Questions regarding this bulletin may be directed to the Payroll Audit mailbox.