Section 200.2-a of the State Finance Law (Chapter 947 of the Laws of 1990) provides for the withholding of one tenth (ex., a full time ANN employee would potentially have 5 days held) of an employee's salary in each of the first five payroll periods, beginning with the date of an employee’s initial appointment to a position covered under the program. Payment for the withheld salary is made at the time of separation from service or at the time of appointment to a position not covered under the Salary Withholding Program, whichever is sooner (Chapter 702 of the Laws of 1991). This payment will be made at the employee’s rate of pay when they separate from the eligible position, except when the withholding was taken at a higher salary rate. In that case the withholding will be paid back at the rate it was taken.

Agencies are responsible for determining an employee's employment status and starting the salary withholding process. The salary withholding is to begin at the time of an employee's initial appointment to a bargaining unit covered by the legislation.

The amount of salary to be withheld will be calculated using the salary rate including any additional salary factors in effect, the employee's part-time percentage, and employee’s status in effect on the last day of each of the initial five (5) pay periods. Employees that are placed on the Salary Withholding Program and subsequently go on a leave of absence before receiving their first 5 paychecks should not be placed back on Salary Withholding to complete the withholding program, unless the employee returns to work within the initial 5 pay periods. If the employee returns within the first 5 pay periods, the withholding will still cease on the original end date, that is, five pay periods from the initial start date. An employee who was appointed as a part-time employee or who was absent for a pay period in the first 5 pay periods will have less than 5 full days deducted. Once held that will be the number of days held until the employee separates or moves to an ineligible position. They should not be placed back on the program to complete the “5” days.

The agency is responsible for placing employees on Salary Withholding when they are initially hired or move from a position not subject to Salary Withholding into a position that is subject to the program. If an employee was overlooked and not placed on the Salary Withholding program when they are initially appointed, they must be placed in the program as soon as possible using the salary in effect at the time of appointment to the eligible position. Refer to Bulletin 368 for instructions.

Rules and Eligibility Criteria

Who is subject to the Salary Withholding Program

• Salaried employees in Executive Branch agencies and in BU 02, 03, 04, 05, 06, 07, 13, 17, 18, 40, 42, 46, 47, 52, 62, 66, 67, and 98 and whose pay basis code is ANN, 21P, CAL, and BIW (Legislative).
• Hourly employees in the above stated BU’s are also subject to the withholding, except for students, seasonal employees (as defined by DOB and/or agency), and employees who work occasionally on a sporadic or as needed basis.

Current practice allows the discretion of the Agency to determine which hourly employees are subject to salary withholding.

• Employees in Legislative Branch agencies and in BU76, 77, and 79, except in Department 04001, 04023, 04060, 04120, 04310, and 04320.
• Employees who move from an ineligible position to an eligible position as a result of a transfer or position change must be placed on the Salary Withholding Program effective in the first pay period they will receive a paycheck in the eligible position.
• Employees who leave state service or move into an ineligible position and receive a lump sum payment for the days withheld and are subsequently rehired or moved back into an eligible position, are subject again and must be placed back on the Salary Withholding Program.

Review the Salary Withholding balance table to determine if any days have been previously held and not paid back.

If days remain in the balance table that should have been paid back upon original movement to an ineligible unit, pay back the old days at the prior rate and restart salary withholding in the new position.

• Salary Withholding cannot be waived in cases of financial hardship.

Salary Withholding Earn Codes on Addl Pay Page and Time Entry Codes to Payout the Days Held upon Separation

The following earn codes are reported in the Additional Pay page to place an employee on the Salary Withholding Program. The earn code to be used is determined by the employee’s pay basis code. The Time Entry PayBack codes are also based on pay basis code at the time of separation.

To place an employee on the Salary Withholding Program, the agency must insert a row on the Additional Pay page, using the appropriate salary withholding earn code and an End Date that is the last day of the fifth pay period.

Salary Withholding Addl Pay Earn Codes and Time Entry Pay Back Codes

* SCO override code is used, regardless of pay basis code, when an employee was not placed on Salary Withholding in a timely manner AND the employee’s salary rate, additional salary factors, work %, and/or pay basis code has changed since the original withholding should have occurred AND the change resulted in a rate of withholding that is different than the rate upon which the original withholding would have occurred. If the rate is the same use the correct earn code. Enter a General Comment in all instances to note the late set up. Refer to Payroll Bulletin No. 368 regarding calculation of days and amount to be used with the SCO override code.

**SLO is used to report payout for an employee who:

• Had a higher daily rate at the time of the withholding than the daily rate in effect at the time of separation. Pay Back would then be at the rate it was taken.
• An Institution Teacher withheld as 21P and is a CAL employee at the time of separation. This employee would be eligible to have their withholding payback calculated using the 21P method.
  • 21P method of payment is (Annual Salary + Factors)/ number of days in the Academic year (Contract Days)