03-P-012 Award Earnings Codes
|DATE:||September 10, 2002|
|SUBJECT:||Award Earnings Codes|
|EFFECTIVE DATE:||September 15, 2002|
|SUMMARY:||New Award SHARP Earnings Codes and Inactivating Old Codes|
Senate Bill 429 of the 2002 Legislative Session established an employee award and recognition program for state employees. Under this program, monetary or non-monetary awards may be made to state employees. Agencies may select from the following categories when establishing an award and recognition program: distinguished accomplishment, meritorious service, innovations, Kansas quality management, or volunteerism. Agencies are required to recognize employees for the length of service award category. A regulation to this effect is pending.
The total gross value of all monetary and non-monetary awards to a single employee during a fiscal year must not exceed $3500. The award can be paid from Kansas Savings Incentive Program (KSIP) funds.
All monetary awards provided under this program should meet the conditions for a discretionary bonus and thus, not affect the calculation of overtime. Monetary awards are included in taxable gross income and are subject to all applicable taxes and employer contributions. These include federal and state withholding taxes, OASDI, Medicare, Unemployment Compensation Insurance, Workers Compensation Insurance, and State Leave Assessment. Monetary awards are not subject to deductions under the Kansas Public Employees Retirement System (KPERS).
Non-monetary awards are included in taxable gross income and are subject to all applicable taxes and employer contributions (same as monetary awards) unless they can be excluded or partially excluded from income for the following reasons:
- The award is considered a "de minimis fringe benefit" under IRS Code Section 132.
- The award is considered an "employee achievement award" under IRS Code Section 74.
Complete Employee Award and Recognition Program guidelines, procedures, sample forms, and reference book are available on the Division of Personnel Services website located at: http://www.da.ks.gov/ps/subject/award/
The following earnings codes will be added to SHARP effective September 15, 2002, to accommodate this new legislation:
|Earns Code||Description||Check Stub|
|DAA||Distinguished Accomplishment Award||Bonus|
|KQA||Kansas Quality Management Award||Bonus|
|LNA||Length of Service Award||Bonus|
|MSA||Meritorious Service Award||Bonus|
|NMA||Non-monetary Taxable Award||Other Remuneration|
One earnings code will be inactivated effective September 15, 2002 due to this legislation:
QBP - Quality Bonus Payment*
*QBP has been unavailable for agency use since July 1, 2002 due to the new legislation passed in SB429.
The Division of Accounts and Reports, Payroll Systems Team, is responsible for adding and inactivating these earnings codes in the SHARP system. Regents Institutions are responsible for ensuring these earnings codes are available on their individual systems.