SUBMITTED TO: SUBMITTED BY:

Mr.MOHAMMAND AQIB AHSAN POOJA SHARMA

OFFICER-HR MASTERS IN HUMAN RESOUCE

THOMSON PRESS ( I ) LTD. INSTITUTE OF MARKETING

OKHLA AND MANAGEMENT

TABLE OF CONTENTS

S.NO. DESCRIPTION PAGE

NO

.

1. ACKNOWLEDGEMENT

2. BRIEF SUMMARY OF THOMSON PRESS

3. UNITS IN THOMSON PRESS

4. OBJECTIVES & METHODOLGY

5. FINDING

6. HR INVENTORY SYSTEM

7. BENEFITS OF THE STUDY

8. GRAPHS

9. BIBLIOGRAPHY

ACKNOWLEDGEMENT

At the very outset I would to thank Mr. Md. Aqib Ahsan, the HR- Officer

for giving me an opportunity to work under his valued guidance in

Human Resources Department at Thomson Press. I am indebted to him

for the keen interest he showed in my project and helping me out

whenever I faced some difficulty.

I am also grateful to Mr. S.S. Saini, Head of Okhla unit Thomson Press

and Mr. Kapil Raina, Head of the Sales Department Okhla Unit for

allowing me to undergo training for 8 weeks in your prestigious

company.

Last but not the least I am greatly indebted by the support extended to me

by Mr. Sunil Kumar and Mr. Ashish Kumar Bera, without there valuable

help it would have been impossible for me to complete this project. Their

selfless contribution and suggestions are deeply appreciated by me.

I would like to thank my placement coordinator Mr. Monisha Verma to

be grateful towards me.

Date: (POOJA SHARMA)

RESEARCH METHODOLOGY

Exploratory Research

Exploratory research is often conducted because a problem has not been

clearly defined as yet, or its real scope is as yet unclear. It allows the

researcher to familiarize him/herself with the problem or concept to be

studied, and perhaps generate hypotheses (definition of hypothesis) to be

tested. It is the initial research, before more conclusive research

(definition of conclusive research) is undertaken. Exploratory research

helps determine the best research design, data collection method and

selection of subjects, and sometimes it even concludes that the problem

does not exist!

Another common reason for conducting exploratory research is to test

concepts before they are put in the marketplace, always a very costly

endeavour. In concept testing, consumers are provided either with a

written concept or a prototype for a new, revised or repositioned product,

service or strategy.

The results of exploratory research are not usually useful for decision-

making by themselves, but they can provide significant insight into a

given situation. Although the results of qualitative research can give

some indication as to the "why", "how" and "when" something occurs, it

cannot tell us "how often" or "how many". In other words, the results can

neither be generalized; they are not representative of the whole

population being studied.

SECONDARY DATA COLLECTION

Secondary data are data that were collected by the persons or agencies for

purposes other than solving the problem at hand. They are one of the

cheapest and easiest mean of access to information. Hence, the first thing

a researcher should do is search for secondary data available on the topic.

The amount of secondary data available is overwhelming, and

researchers have to locate and utilize the data that are relevant to their

research. Almost all the information systems initially are based on

routinely collected internal data, and expand through the inclusion of data

from published and standardized sources.

A company’s internal records, accounting and control systems

provide the most basic data on resulting outcomes. The principal virtues

of these data are ready availability, reasonable accessibility on a

continuing basis, and relevance to the organization’s situation.

USES OF SECONDARY DATA

Secondary data can be used in many ways:

1. Secondary data may actually provide enough information to

resolve the problem being investigated.

2. Secondary data can be a valuable source of new ideas that can be

explored later through primary research.

3. Secondary data is of use in the collection of primary data.

Examining the methodology and techniques employed by other

investigators may be useful in planning the present one. It may also

suggest better methods.

BENEFITS OF SECONDARY DATA

The most significant benefits secondary data offer are savings in cost and

time. Secondary data research involves just spending a few days in the

library extracting the data and reporting them. This should involve very

little time, efforts and money.

ABOUT THE COMPANY

Thomson Press - An Overview

Thomson Press (India) limited an ISO 9002 company was registered in

1964 with equity participation of the Thomson Group of Canada. It

commenced its commercial operations in 1967. Dr. Zakir Husain

inaugurated the parent plant located at Faridabad in 1967.

Thomson Press (India) limited is one of the largest commercial printing

houses in India. Ever since establishment, Thomson press has worked to

exemplary high standard of printing technology with the use of latest

state-of-the-art technology and an excellent pool of talent, trained and

highly skilled work force lead by dynamic managers and management

staff.. Thomson Press management has hereafter kept pace with latest and

sophisticated printing technology being used by the development

countries like Japan, UK, France, Canada and Italy etc. by close global

liaison with other printing companies and equipment manufacturers on a

regular basis. The company has a strong commitment to Human

Resource Development and employs substantial expertise in its Graduate

Engineer Trainee, Trade Trainee and Diploma Engineer Trainee

Schemes.

Thomson Press undertakes total execution of any printing job that

involves Pre Press processing, Color and Digital Electronic Imaging,

Printing on Sheetfed or Wed fed multicolored printing machines.

Besides, all types of fabrication and finishing operations are also carried

out in a totally integrated manner.

The company is on contract for printing and supplying magazine like

India today, Business Today, Computers Today, Reader’s Digest, First

City, Down To Earth, Travel Trends and many more periodicals which

included most of the domestic and international airline in flight

magazine. It also produces large number of Multicolored Posters,

Brochures, Leaflets, Folders, Danglers, Visual Aids, Press Campaigns,

Annual Reports, Company Reports, Company Manuals, Calendars,

Diaries, Bibles, and Bound Books. Apart from day to day activities,

Thomson Press is also engaged in Printing Cheques, Security Bonds,

Major Airline Tickets, Bus Tickets and Lottery Tickets.

The company has achieved national and international recognition for

delivery of high quality printed material by stringent measures of on-line

quality control, on purchasing, vendor and process controlled production

facilities with an eye for quality where the service is customer driven.

THOMSON PRESS PRINTING DIVISION

It was initially involved in

the distribution of

publications of a large

number of overseas

publishers, and printing of

children's books for export.

In 1974 the focus shifted to printing of the group's prestigious

publication India Today. As of date apart from a number of

prestigious magazines printed for various publishing houses, TP also

prints high quality commercial POS items and books for the

domestic and export markets.

Each of our five units has developed its own unique strengths and

areas of expertise, providing our customers with a strong support

structure across an extensive range of printing services.

Absolute commitment to quality, meticulous attention to detail and

unparalleled level of service have made TP a leading specialist in

Design, Prepress, Printing and distribution services. As a company

we are committed to employing dedicated staff, investing in the very

best technology available and maintaining a close involvement with

the industry.

Thomson Press Printing Division comprises of one Pre Press and two

Printing units in Delhi, one printing unit in Chennai and one printing

 

& Book Bindery unit in Delhi exclusively for exports.

TP has always been a frontrunner in introducing the latest printing

technology in India

1. High end drum and flatbed scanners.

2. Multicolour sheetfed and web printing machines.

3. Mechanized binderies.

4. Copy dot scanner.

5. CTP.

The product range covers virtually all-commercial print requirements

on paper and board, from bank instruments, to calendars, diaries,

books, corporate brochures, posters, folders, leaflets, and magazines.

This range of services and products covers designing, copy editing,

typesetting, high quality scanning and image manipulation, sheet fed

offset printing, heat set and coldest web offset printing, automated

binding, finishing, distribution and mailing services.

DIGITAL OPERATIONS AT THOMSON

PRESS

Digital Operations Department is equipped with the latest technology and

it basically deals with prepress operations viz. scanning, manipulations

and creations, page planning, colour corrections, digital proofing and

taking the output on the film.

The Digital Operations Department has two divisions one situated in

Okhla and the other is in Connaught Circus. The Connaught Circus

Office (K-13) deals with all the living media production viz. India today,

business today, computers today, teens today, India today plus, readers

digest, cosmopolitan and first city whereas in Okhla all commercials jobs

are taken up which includes Posters, Brochures, Press Campaigns,

Advertisement, Calendars, Books, Diaries, Leaflets, Annual Reports,

Bibles, Bound Books etc.

A total of 33 employees are working in supervisory cadre in digital

operation department i.e. 16 in Okhla and 17 in K-13 (including new

recruits). As the project deals with employees in Digital Operations

Department so a bit of information as to how the department works

would be useful in understanding things. (Refer figure 2)

Sales and marketing employees procure the job from the client and give it

to the customer support department. This department acts as a interface

between the client and the Digital Operations Department. As soon as job

is received, it is studied. If the material is a photograph or a transparency

then it is sent for scanning and after that directly to work station. It the

job is in electronic media like floppies etc. then it is directly sent to the

workstation. There are different workstations as Mac, Prism Ax, Blaze

98, Star PS and PC.

After the job has been finished, its output is taken either on iris or

directly on film. Since taking the output directly on film is costlier than

on iris, so iris output is preferred. When the client gives his consent that

the work is to his satisfaction, than its output is taken on the film and

after that output departments. (Layout, Plate Making, Fag Proofing) role

comes into play

COMPANY PROFILE

Thomson Press (India) Ltd., an ISO 9002 company was incorporated in

1967 with the technical & financial collaboration of Thomson

International Corporation of Canada. As on date, Living Media and the

Investment companies of the Promoter Group hold 85% of the Equity

Share Capital of Thomson Press (I) Ltd. With the balance 15% being

held by New York Life Insurance. The parent plant located at Faridabad

was inaugurated on 9th March 1967, which is now celebrated as

company’s annual day.

Thomson Press (I) Ltd. Is the largest commercial printer in South Asia.

Ever since its incorporation, Thomson Press has worked to exemplary

high standard of printing with use of latest state-of-the-art technology

supported by an excellent pool of talent, trained and highly skilled work

force headed by dynamic professional management staff. Thomson Press

management has kept pace with the latest and sophisticated printing

technology being used by developed countries like Japan, U.K., France,

Germany, U.S.A, etc with commitment to Human Resource

Development.

Thomson Press undertakes total execution of any printing job that

involves Pre Press, Color and Digital Electronic Imaging, Printing on

Sheet fed or Web fed multicolor-printing machines. Besides, all types of

fabrication and finishing operations are also carried out in an integrated

manner.

The company is commercial printer and supplier of magazines like India

Today, Business Today, Computers Today. Cosmopolitan, Reader’s

Digest, First City, Down to Earth and many more periodicals, which

includes in-flight magazines. It also produces large number of multicolor

Posters, Brochures, Leaflets, Folders, Danglers, Visual Aids, Press

Campaigns, Annual Reports , Company Manuals, Calendars, Diaries,

Bibles, Bound Books (Paper Back and library bound Deluxe Editions).

Apart from day to day activities, Thomson Press is also engaged in

printing Cheques, Security Bonds and Airline Tickets.

The company has achieved national and international recognition for

delivering printed material by stringent measures of online Quality

Control on purchasing, vendor evaluation and process controlled

production facilities with an eye for quality where the service is customer

driven.

ASSOCIATION OF THOMSON PRESS (I)

LIMITED WITH INDIA TODAY GROUP

The group comprises of companies viz.

COMPANY BUSINESS

World Media Ltd. Journalism

Living Media India

Ltd.

Publishing/Music/Website

Hosting/Online News

Paper

TV Today Network

Ltd.

Electronic Media

Integrated Database

India Ltd.

Publication of Industrial

& Commercial

Directories

Radio today

Broadcasting Ltd.

Broadcasting of FM

Radio

The group started with the incorporation of Thomson Press in 1967 with

the technical & financial collaboration of Thomson International

Corporation of Canada. The publishing business was started with the

brand name INDIA TODAY in 1975, a news magazine, which is

published weekly in English and four other regional languages. The

group diversified its publishing magazines on business, computers etc.

Living Media India Ltd. is one of the largest Magazine Publishing houses

in the country. Its products India Today, Business Today, Computers

Today, Cosmopolitan are the highest selling magazines in India.

The continued growth and expansion of the company’s publishing and

business i.e. detailed as under:

1. India Today : English 2. India Today : Hindi

3. India Today : Tamil 4. India Today : Malayalam

5. India Today : Telugu 6. India Today Plus

7. Computers Today 8. Business Today

9. Books Today 10. Cosmopolitan

11. India Today : International

Music Business:

Music Today: Audio Cassettes & Compact Discs

Electronic Media:

The Company started diversifying into the business of Electronic Media

in 1995. TV Today Network Ltd. Launched 24 Hours Hindi News

Current Affairs Channel viz. “Aaj Tak”. The channel went operational in

December 2000 & is highly popular news channel.

Organisation structure

EDP

IMPORT & CUSTOMS

FINANCE & ACCOUNTS

MATERIALS1-PURCHASE2- STORES

MANAGING DIRECTOR

EXECUTIVE DIRECTOR

ACCOUNT & FINANCE

DOMESTIC PRINITING

EXPORT PRINITNG

EXPORT TYPESETTING

INFORMATION SERVICES

TP - SCHOOL

BUSINESS DEVELOPMENT

TP LM ACCOUNTS & CIRCULATION

INTERNAL AUDIT

ACCOUNTS

TAXATION

COSTING

FARIDABAD UNIT

Thomson Press

Strategically located at 18/35 mile stone, Delhi-Mathura road, the parent

unit was inaugurated on 9th March 1967 by the then President of India,

Dr. Zakir Hussain.

The main job of a printing press is as its name suggests – “to press the

inked form and the paper together”.

Presses perform many actions. They move the paper through the whole

printing process, print on one or both sides in one or more colours, cut

and fold the papers and perform binding operations. The function can be

divided into three main processes viz.

1. Pre Press

2. Printing

3. Finishing operations

The printing unit is also the head office of Thomson Press India Limited,

which controls and regulates the functioning of all the other units of the

company. Thomson press recognizes quality as the prerequisite for

conducting business that is an inseparable element of all activities carried

out in the press.

This unit has earned the ISO 9002 certification in 1997.

Organization Structure

The work force of the Organization is broadly classified into: -

a. Managerial and Supervisory staff

b. Workmen including Administrative/Clerical staff.

The work force is divided into different cadres/department, so as to

ensure a smooth work flow and proper delegation of authority. The

people at different cadres/department have well defined roles and

freedom of action, which avoids overlapping of authority and ensures

unity of command.

Cadres and Grades

S. No. Designation Grades Cadre

1 General Manager A I

2 Chief / Senior Manager B II

3 Deputy Senior Manager C II(A)

4 Manager D III

5 Deputy Manager E III(A)

6 Assistant manager F IV

7 Sr. Foreman/ Sr. Officer G V

8 Foreman / officer H VI

9 Asst. Foreman/ Asst.

Officer

I VII

10 Senior Supervisor J VIII

11 Supervisor K IX

12 Asst. Supervisor L X

POLICIES AND PROCEDURES

The services of all the appointments can be transferred from one job to

another in the plant or from one branch to another anywhere in India.

JOINING FORMALITIES

On joining the person is required to undergo the following formalities

with the personnel department:

Medical examination

The joining report

Declaration form EPF, ESI, PF, Nomination and Benevolent fund.

A photocopy of all educational and experience certificates.

Photocopy of birth certificates

Relieving certificate from the previous employer

Two passport size photographs

Identity card cum attendance card will be issued and a token

number will be given

GENERAL RULES

WORKING HOURS:

The company runs round the clock in three shifts, the shift timings are as

under:

8:15 AM to 4:15 PM 1st Shift

4:15 PM to 12:15 AM 2nd Shift

12:15 AM to 8:15 AM 3rd Shift

ATTENDANCE:

All the employees are required to punch their attendance card in the

computerized clocks, installed at various locations within the factory, at

the time of entry and exit.

SECURITY:

To ensure security of company’s property, guards at the time of

entry and exit, carry out search test.

The employees cannot bring or take any material in the press

No visitor is allowed inside the factory premises without proper

authorization. As per the company’s policy, all the visitors should

enter the name, address, and time of entry and exit in the register

available with the security personnel at the gate

Gate pass will be issued to the official visitors along with visitor’s

identity card, which are to be returned at the time of leaving the

premises. Visitor’s are advised to display the visitor’s identity

card.

Your personal visitors are to be received at the reception only.

For going out for an official/ personal work during working hours

the employees from workers to junior management staff, have to

fill a prescribed form, duly approved from the departmental head

and managers have to make an entry in the register available with

manager security.

CORPORATE TRAINING SCHEMES:

Training scheme covers professionally qualified persons who are taken as

Management Trainees and Graduate Engineer Trainees undergo training

with the company in a phased manner as detailed below:

S.

No.

Category Qualifications Duration

of Training

Cadre/Designation

after completion

of training

1 Management Ph.D. / CA / One year V / Sr. Foreman

trainee ICWA /

MBA

2 Graduate

Engineer

Trainee/ Junior

Management

Trainee

BE / B Tech /

BE (Ptg.) /

MSW / M

Stat

One year

training &

one year of

probation

VI / Foreman

3 Supervisor

Trainee

Dip Engg.

(Mech) Elect.

/ Civil

Two year IX / Supervisor

4 Asst

Supervisor

Trainee

BA / B Com /

B Sc / Dip

Ptg. Above

60%

Two year X / Asst

Supervisor

Training to concerned employees will be given as the need is identified

based on:

Review of annual performance appraisal

Special requirements of HOD

By circulating available information related to various training

programmes received from training institutes etc.

Level Type of training Faculty

Manager Management

Development

IIM’S, MDI

Programs In-House

educational seminars

Junior management Management

Development

Programs Specialized

Training in-house

technical discussions

External

Workmen On the job training (at

least two in a month)

Specialized Training

regular technical class-

room

External / Internal

All identified training needs are examined as per organizational

requirements and a training calendar is finally approved and

documented

Employee wise training records are maintained

Training programmes are evaluated through feedback

Induction

Every new employee is given an intensive induction training, which

ranges from 15 days to a month depending on the position and the

requirements. This is designed in manner to put the new employee at ease

in the company and make him / her know of who is who and what is what

in the company.

PERFORMANCE APPRAISAL SYSTEM

TYPES OF APPRAISAL TIME OF APPRAISAL

Executive Appraisal April and October

Trainee Appraisal Quarterly

Work Man / Staff Appraisal January and July

BENEFITS AND FACILITIES LEAVE

LEAVE

Leave is categorized as under

PL/EL = Privileged Leave/Earned Leave

CL = Casual Leave

SL = Sick Leave

However, there is yet another kind of leave, i.e. leave without pay

(WP) which is an authorized leave with loss of pay.

Every employee has to fill the prescribed leave from before

proceeding on leave.

Weekly off and holidays whether occurring during or at the end of

the leave period shall not be counted as leave in case of leave.

In a year the employee shall be entitled to the following type of

leave:

S.N

O.

CATEGORY

PRIVILEG

E

SICK CASUAL

*E *A E A E A

1 Asst Supervisor –

GM

28 240 7 180 - -

2 Administrative staff 21 75 7 - 7 -

3 Workers 14 75 7 - 7 -

An Employee becomes entitled to a leave after completing 40 days

of working.

In addition to these 11 days, National / Festival Holidays are

provided to the employees.

Maternity Leave: As per the Maternity benefit Act

ASSOCIATES OF THOMSON PRESS

THE CUSTOMER BASE

Thomson has over the years acquired association with large number of

customers in India and overseas. We are servicing our overseas

customers’ needs for Printing and Electronic Publishing including

Scientific publication, which is it’s core strength. Living Media has its

own publications like India Today, Business Today, Computers Today,

Teens Today, Cosmopolitan printed at Thomson Press, which are leaders

in the country in their respective areas.

Following is a glimpse of our associates, definitely not at all exhaustive

list:

COMPANY’S CUSTOMERS INCLUDE:

INDIA WORLD WIDE

Adidas Addison Wesley

Bates Clarion Al Nisr Publications

ITC Book Builders, Hong Kong

LG Cambridge University Press, U.K

Becton & Dickinson Dorling Kindersley, U.K

Lintas Elsevier Group, U.K.

LIC of India Gordon & Breach, Singapore

Nestle Gulf News, Dubai

Maruti Suzuki Harcourt Brace Publishers

Samsung Inner Traditions, U.S.A

Otto Burlington International Publisher & Distributors

Rediffusion John Wiley

Mercedes Benz McGraw- Hill

Mudra Mission India, U.S.A

R K Swamy Octopus Group

Osho Commune Osho International (World wide)

Sahara Airlines Oxford University Press

State Bank of India Promotional Reprint Company, U.K

UCO Bank Reed Customer Books, U.K

Panjab & Sind Bank Springer Verlag, Germany

Modi Care Studio Editions, U.K

Escorts UN’s International Children’s Education

Times of India Fund – UNICEF

OTHER PLAYERS IN THE FIELD

Main competitors of Thomson Press are:

NORTH

Ajanta offset, Mehta offset, Dhriti Printer, Newtech, IPP (Delhi)

EAST

Art Printing, Naba Mudran, NK Grossain, LC Roy and Anderson

Printing (Kolkatta)

WEST

Tata Press, Comvay, Vakil, Repro(Mumbai)

SOUTH

Mytech, Prasad, Pragati Printers (Hyderabad), Coronation.

For Pre-press (Repro) business our competitors are:

NORTH

Ajanta Offset, IPP (Delhi)

EAST

Antartica and Repro Scan (Kolkatta)

WEST

Com Art, Jessra, Unique (Mumbai)

SOUTH

Mytech and Print system (Banglore).

 Services at Thomson press

  Undoubtedly Thomson Press is a leader in handling large volume

multi colour work.

The product range covers virtually all-commercial print requirements on paper

and board, from bank instruments, to calendars, diaries, books, corporate

brochures, posters, folders, leaflets, and magazines.

This range of services and products covers designing, editing,

typesetting, high quality scanning and image manipulation, sheet fed

offset printing, heatset and coldset web offset printing, automated

binding, finishing, distribution and mailing services.

TP provides a complete service for mailing and fulfillment, managing

every aspect of the delivery service as required by our customers. A

number of options are available from complex multiple personalised

inserts to the largest campaign and launch mailings.

We aim to offer the most comprehensive print management service

 

available. And that doesn't just mean we'll take the best possible care

of you.

For us, building close working relationships with customers goes

much further. Whatever the project, listening to our customers'

requirements and coming up with bright ideas and practical

suggestions to achieve a better result more cost-effectively is all part

of the service we provide.

QUALITY ASSURANCE

Quality Policy

QUALITY POLICY OF THOMSON PRESS, FARIDABAD

We hereby pledge to achieve complete customer satisfaction through

excellence in quality. We wish to achieve this by :

Motivating workforce committed to continuous

improvement in working methods.

Working as a well-knit team to ensure that quality

objectives are met.

Committing vendors to continuously work on

improvement in quality standards.

ROLE OF QUALITY ASSURANCE IN THOMSON

PRESS, FARIDABAD

  Defect Prevention

   By Setting Standard:

   

 

Standard has been set as per the ISO 9002 international

Quality System and has been certified from BSI India Pvt. Ltd.

The standard is being revised from time to time whenever

there is some improvement or modification in the system.

    Ensuring adherence of the Standard:

   

 

Periodical audit of the system standard is being conducted to

check the compliance of the standard.

    Corrective and Preventive Action:

   

 

Every customer complaint is being thoroughly investigated by

QA for its origin and reason. Necessary corrective &

preventive action is being taken in consultation with the

concerned departments.

  Defect Detection

    By gathering data constantly on occurrence of defect:

    

Every job undergoes thorough inspection by QA before

dispatch as per the inspection plan & defect checklist.

    By sending information about defects to relevant

departments:

   

 

Daily, Weekly & Monthly reports are being sent to the

relevant departments and the same are being reviewed

periodically with the concerned departments.

UNITS - THOMSON PRESS

Export Division (Phototypesetting), NEPZ, Noida (U.P.)

This unit commenced its commercial production in the field of

phototypesetting, with the objective of availing opportunities offered by

the international market.

The clientele includes some of the leading publishers of USA and

Europe. The electronic typesetting division has developed its resources

around customer friendly contemporary technology to offer the services

for complex scientific publishing projects.

The in-house software development team develops conversion tools. Its

copyediting resources are strategically located in Noida, New Delhi and

Madras. The Chief Scientific Editor directs the team activities from

Noida.

C-35,Noida

A 100% export oriented unit, where the output quality matches the

international standards, utilizing imported raw material, leading to

production, printing and binding of high quality hard case and paperback

books.

This unit produces two million each hard case and paperback books per

year. The prepress resources included camera, layout and plate making.

Noida Security Printers, Noida

This unit of Thomson Press is responsible for printing of lottery and

travel tickets. All the functions are decentralized, viz. Decentralized

purchasing, independent accounts, set-up and a proper back up with

debtor’s reports & Age analysis.

Okhla, Repro House

This unit comprises of two separate departments namely, Repro and

Sales house consist of Customer Support, Digital Operations, Layout,

Plate Making, Fag Proofing and Manual Planning Departments.

Repro undertakes all the preprocess activities including digital

operations. State of the art technology is employed to produce the best

possible quality with the expertise of specially trained manpower. A team

of dedicated specialists further enhances the capabilities &

competitiveness.

Inventory Management

In today's environment, capital for inventory can be hard to access and

expensive when available. In addition, inventories are expensive to

carry. Capital costs (cost to finance), service costs (insurance,

inventory control and taxes), storage costs (warehouse rent,

equipment, utilities and handling) and inventory costs (obsolescence,

damage, shrinkage and excess) all contribute to inventory carrying

costs of 2% of the value of the inventory, per month. These hidden

costs can average 25% of the value of inventory, or 1% to 3% of

revenue each year.

Source: REM Associates

Inventory is a poor investment alternative for cash, but imperative to

achieve required service levels. Maintaining the appropriate levels and

types of inventory is essential to providing quality, timely service and

products to your customers. Preventing stock-outs without

overstocking products requires a disciplined process and information

system that can dynamically manage this balance. If your organization

does not compute the true cost of inventory, your assets could be

underutilized and costing you money.

Two of the keys to optimizing inventories are to improve reliability

and reduce variability in the supply chain to meet your customer's

demand while being cost effective. Our professionals can provide the

knowledge and technology to assist your organization in better

managing your inventory investment, so you can have the right

inventory in the right place without over committing resources.

Anixter helps you to achieve a balance of minimized inventory

carrying costs in order to meet required service levels.

Inventory Management Benefits

Reduce capital investment and carrying cost of inventory

Postpone ownership

Minimize risk of excess, obsolescence and duplicate inventories

Reduce the cost of maintaining inventories by paying only for

the material you use, as you use it

Reduce the total cost of ownership

Minimize the number of purchase orders, returns, stock-outs and

time needed to the "invoice matching process"

Eliminate traveling to distributor's will-call counters to pick up

small orders, resulting in lost labor time

Services

Consigned inventory programs

Guaranteed inventory availability programs

Visual replenishment programs

Just-in-time delivery and replenishment programs

Inventory buy-back programs

Vendor Managed Inventory Program (VMI)-Anixter and third-

party manufacturers

Web-based, real-time inventory visibility

Inventory Management deserves separate mention beyond other

phases of accounting due to its importance to operations.

With Inventory, you have two conflicting goals: minimize the amount

of money tied up in product and never be out of product when you

receive an order. You need to know exactly what you have, where it is,

what you're likely to need to fill orders, where you get it, how long it

takes to get it, current costs and pricing, how many turns you get out

of which items, how much it's all really worth and how much you can

tell the IRS it's all worth.

Information systems, properly applied, can be a big help in handling

all these factors and making your inventory a lot more profitable by

optimizing your use of the inventory itself. Tight control of inventory

reduces the amount of idle money tied up in slow moving or obsolete

product, and maximizes investment in items that pay a good return. It

also can greatly reduce "shrinkage".

Various Definitions of inventory

“The process of ensuring the availability of products through

inventory administration.”

“Systems and processes that identify inventory

requirements, set targets, provide replenishment techniques

and report actual and projected inventory status”.

“Handles all functions related to the tracking and

management of material. This would include the monitoring

of material moved into and out of stockroom locations and

the reconciling of the inventory balances. Also may include

ABC analysis, lot tracking, cycle counting support etc.”

‘The development and maintenance of adequate assortments

of products to meet customers' needs”

“Management of the inventories, with the primary objective

of determining:

A subset of Configuration Management that focuses on the

management (control and financial accounting) of the most

expensive or attractive CIs in the IT infrastructure. See also

Asset Management, Configuration Management.”

“The process of ensuring the availability of products through

inventory administration activities such as planning, stock

positioning, and monitoring the age of the product. The goal

is to ensure product availability.”

“Activities involved in maintaining the appropriate level of

stock in a warehouse.”

BENEFITS OF HR INVENTORY

LEAVE POLICIES

The State Auditor is responsible for providing uniform interpretation

of certain leave provisions, and for reporting any exceptions made by

individual agencies to the Governor and the Legislature. However,

the Attorney General has ruled that the interpretations of the State

Auditor are advisory only.

Leave Records

For each employee, each state agency is required to keep a record, in

addition to an official personnel file, of time and attendance; vacation

and sick leave accrual; absences; and the reasons for absences,

whether from sickness, vacation, other paid leave, or leave without

pay.

Paid Leave Bank For Institutions Of Higher Education

The governing board of a university system may adopt a

comprehensive leave policy that applies to employees working in a

hospital or clinic of a medical and dental unit of the university

system. This policy may combine vacation, sick, and holiday leave

into a paid leave system that does not distinguish or separate the

types of leave to be awarded and may award leave in an amount

determined by the governing board to be appropriate and cost-

effective. This leave policy must include provisions for:

1. Payment for accrued leave to:

A. The estates or heirs of deceased employees

B. Employees separating from the employing entity

C. Contributing members of state retirement systems who

retire

2. Awards of accrued leave to employees separating from the

employing entity who are to be employed by other state

agencies or institutions of higher education.

On or after September 15, 2005, the governing board of an institution

of higher education may adopt a leave policy as provided above for

employees of the institution.

Leave and 662 - Holidays and Recognition Days and Months of the

Texas Government Code, do not apply to employees covered by a

paid leave bank policy adopted by an institution of higher education.

Annual Leave

Employees of the State are entitled to a paid vacation as determined

by length of service. Exceptions include faculty members who have

appointments of less than 12 months at institutions of higher

education and instructional employees who hold contracts for periods

of less than 12 months at the Texas School for the Blind and Visually

Impaired and the Texas School for the Deaf. Employees of junior

colleges are not considered state employees. Employees paid on an

hourly or daily basis are entitled to a vacation with full pay accrued

at the same rate as employees paid on a monthly basis. Part-time

employees are also eligible for paid vacation, but they accrue

vacation leave on a proportionate basis, and their maximum

carryover is proportionate as well. For example, half-time employees

may earn, and may carry over, vacation leave at one-half the rate

authorized for full-time employees. When an employee's status

changes from part-time to full-time status in the middle of the month,

the employee would accrue annual leave at the applicable rate on the

first calendar day of the following month. The amount of annual time

accrued is based upon the employee's employment status on the first

day of the month (i.e., part-time, full-time). Because the employee's

status is part-time on the first day of the month, the annual leave time

accrued for the month would be accrued on a proportional basis.

In computing vacation leave time taken, time that an employee is

excused from work because of holidays is not charged against

vacation time.

In 1983, the Attorney General concluded that, for purposes of leave

accrual, the definition of state "employee" includes any appointed

officer who normally works 900 hours or more per year. The effect

of this opinion is that certain appointed officers are allowed to accrue

vacation and sick leave under the same rules and conditions as other

state employees. For further information see the definitions of state

employees in Texas Government Code Section 661.001.

The following table provides the vacation leave accrual rates and

maximum allowable carryover (from one fiscal year to the next) for

full-time employees. All hours in excess of the maximum allowable

carryover left at the end of a fiscal year shall be credited to the

employee's sick leave balance as of the first day of the next fiscal

year.

An employee must complete the required years of employment to be

entitled to receive the higher rate of vacation leave accrual (for

example, the employee must complete 15 years of employment to

accrue 12 hours vacation leave per month). The length of

employment is calculated from the employee's anniversary date.

Credit for the higher rate of accrual, as shown in the table, will be

given on the first calendar day of the month if the anniversary date

falls on the first calendar day of the month. Otherwise, the increase

in vacation accrual will occur on the first calendar day of the

following month.

Credit for one month's vacation leave accrual is given for each month

or fraction of a month of state employment and is posted on the first

day of employment and on the first day of each succeeding month

thereafter. Vacation entitlement accrues from the first day of

employment, and is terminated on the last day of duty. If the

employee is on any type of paid leave which extends into a

subsequent month, any vacation leave accrual for the month of paid

leave will not be posted until the date of his or her return to duty.

Specifically, an employee who is on leave the first day of the month

must return to duty before being eligible to use leave accrued for that

month. If an employee goes on paid leave following his or her last

day of duty and does not return to duty, then subsequently separates

from state employment, the employee is not entitled to leave accruals

while on such paid leave for any calendar month(s) following the

month in which the last day of duty occurs. State employees who are

employed by multiple agencies and who work more than 40 hours

per week may not accrue vacation leave at a rate that would exceed

that for a full-time, 40 hour per week employee.

Schedule of Vacation Leave Accruals for Full-Time Employees

Length of State Service

Hours

Accrued

Per Month

Days

Accrued

Per Year

Allowable

Carry-

Over

(Hours)

Less than 2 years 7 10.5 168

At least 2 but less than 5

years

8 12 232

At least 5 but less than

10 years

9 13.5 256

At least 10 but less than

15 years

10 15 280

At least 15 but less than

20 years

12 18 328

At least 20 but less than

25 years

14 21 376

At least 25 but less than

30 years

16 24 424

At least 30 but less than

35 years

18 27 472

At least 35 years or more 20 30 520

Vacation with pay may not be taken until the employee has been

continuously employed with a state agency for six months. An

employee who resigns, is dismissed, or otherwise separates from

state employment during that six-month period is not deemed to have

had continuous employment for at least six months. Additionally,

continuous employment means that no leave without pay (that is, for

a full calendar month that does not count as state service credit) has

been taken. The six-month eligibility requirement means that once an

employee has completed six months or more of continuous state

employment and then leaves state employment, that person is eligible

to take vacation leave as it is earned upon reemployment, or be paid

for it on termination following such reemployment. An employee

who separates from one state agency will not be paid for his or her

unused vacation time if he or she is reemployed by another state

agency that grants vacation time within 30 days of leaving his or her

previous job.

An employee who resigns, is dismissed, or otherwise separates from

state employment is entitled to be paid for accrued and unused

vacation time, as long as the employee has had continuous

employment for at least six months and provided that the employee

has not been reemployed by another state agency within 30 days of

such separation. Institutions of higher education are allowed to

immediately pay for accrued vacation leave upon separation without

having to wait 30 days after separation. Separation from state

employment includes, but is not limited to, a state employee leaving

one state agency to begin working at another state agency, provided

at least one workday occurs between the employee's separation from

the first state agency and the employee's first day at work at the

second state agency. The Payment Entitlements Upon Separation

From State Employment table on page provides a description of

various payment entitlements upon separation from state

employment. An employee terminating state employment may, with

the agreement of the employing agency, be allowed to remain on the

payroll after the last day worked to use vacation leave in lieu of

being paid in a lump sum. Such an employee will not accrue any

additional vacation leave while remaining on the payroll to use such

vacation leave.

Lump-sum payments for accrued but unused vacation time are

computed as though the employee actually worked that time for the

agency. A state employee who, on the date of separation is normally

scheduled to work at least 40 hours a week, will have eight hours

added to his or her accrued vacation time for each state or national

holiday that falls within the period after the date of separation and

the last date of the period in which the employee could have used the

time had the employee remained on the payroll. State employees who

are normally scheduled to work less than 40 hours a week on the date

of separation are also entitled to have hours added to vacation time

hours for national and state holidays using the same calculation.

However, their additional hours are to be proportionate to the number

of normally scheduled work hours. Employees moving to a position

in a state agency that does not accrue vacation time are not entitled to

add vacation time for holidays that fall within an employee's accrued

vacation time period.

According to Texas Government Code Section 661.063(b)

employees compensated for unused vacation time in one lump-sum

payment are not entitled to receive longevity and/or hazardous duty

pay for the period equal to the amount of accrued vacation time.

However, an employee who is permitted to remain on the agency

payroll while exhausting accrued vacation time will continue to

receive all compensation and benefits that the employee was

receiving on the last day of duty including paid holidays, longevity,

and/or hazardous duty pay while remaining on the payroll. The State

Auditor's Office has further clarified that an employee allowed to

remain on an agency's payroll is entitled to continue to receive all

compensation and benefits that the employee was receiving on the

employee's last day of duty. However, as an exception, the employee

may not use sick leave, or accrue sick or vacation time, while

exhausting annual leave.

Employees transferring from one state agency to another will have

their accrued but unused vacation leave balance transferred as long

as the employment is not interrupted by a separation. If an individual

is separated from state employment and is reemployed within 30

calendar days by a state agency to a position that accrues vacation

time, the individual's previously accrued but unused vacation leave

will be restored.

The State Auditor is directed to provide a uniform interpretation of

the subchapters of the Texas Government Code relating to vacation

leave, sick leave, and miscellaneous leave provisions and "shall

report to the governor and the legislature any state agency or

institution of higher education that practices exceptions to those

laws." An Attorney General Opinion held this provision to mean:

…the State Auditor may provide a uniform

interpretation of the provisions on

employee vacations and leaves, but such

interpretation would be advisory in nature

only and not a final determination, because

the Legislature has specifically delegated to

the Attorney General the responsibility of

interpreting legislative intent as it relates to

the General Appropriations Bill.

Sick Leave

State employees are, without deduction in salary, entitled to sick

leave subject to the following:

An employee will begin earning entitlement to paid sick leave on

the first day of employment.

Credit for one month's accrual will be given and posted for each

month or each fraction of a month to that employee's leave

record on the first day of employment and the first day of each

succeeding month of employment thereafter.

An employee who is on leave the first day of the month may not

use the sick leave that the employee accrues for that month

until after a return to duty.

The employee will accrue sick leave at the rate of eight hours per

month or fraction of a month for a full-time employee and will

accumulate it with any unused sick leave. Part-time employees

will accrue sick leave on a proportional basis.

Sick leave with pay may be taken when an employee is

prevented from performing duties because of sickness, injury,

or pregnancy and confinement. Sick leave may also be taken if

an employee needs to care for a member of his or her

immediate family who is actually ill. Texas Government Code

§ 661.202(d) defines "immediate family" as those individuals

related by kinship, adoption, or marriage who live in the same

household; foster children certified by the Texas Department

of Protective and Regulatory Services who reside in the same

household as the employee; and minor children of the

employee regardless of whether the children live in the same

household.

Sick leave may be taken to care for members of an employee's

family who do not reside in the same household only if the

time taken is necessary to provide care to a spouse, child, or

parent of the employee who needs such care as a direct result

of a documented medical condition. This provision for taking

sick leave does not extend to an employee's parent-in-law if

they do not live in the same household, as per a leave

interpretation by the State Auditor's Office.

An employee who will be absent from work due to an illness

must notify his or her supervisor as soon as possible.

To be eligible for accumulated sick leave with pay for a

continuous period of more than three working days, an

employee must send the administrative head of his or her

agency a doctor's certification, or an acceptable written

statement of facts, showing the nature of the illness. If an

illness results in the absence of three working days or less, the

administrative head has the discretion to require

documentation of the illness.

When an employee returns to work after taking sick leave, he or

she is required to complete a sick leave application which is

submitted to the appropriate approving authority for

consideration.

If an employee is on vacation and would otherwise be entitled to

sick leave, then the fact that such sick leave is requested while

on vacation leave does not affect the employee's entitlement to

sick leave.

State employees who are employed by multiple agencies and

who work more than 40 hours per week may not accrue sick

leave at a rate that would exceed that for a full-time, 40 hour

per week employee.

State employees who are legal guardians by court appointment

may take sick leave to care for a child in accordance with the

leave provisions in Texas Government Code § 661.202

Responding to a request for interpretation of rules for sick leave for

Texas School for the Blind and Visually Impaired employees, the

State Auditor's Office has advised that contract employees may use

sick leave for qualifying events only during instructional days for

which they are under contract.

As provided by Texas Government Code Section 661.206, an

employee may use up to eight hours of sick leave each calendar year

to attend parent-teacher conference sessions for the employee's

children who are in pre-kindergarten through 12th grade.

Employees separated from employment with the State under a formal

reduction-in-force policy are entitled to have their sick leave balance

restored if reemployed by the State within 12 months after the end of

the month following their termination.

Employees are entitled to have their sick leave balance restored if

they are separated from their employment for other reasons and are

reemployed by the State within 12 months after the end of the month

following their termination.

Employees who are who are separated for reasons other than a

formal reduction in force and who are employed by the same agency

or institution may only have their sick leave balance restored if they

have had a break in service of at least 30 calendar days since their

date of termination.

An employee who is restored to state employment following military

service under veterans' employment restoration provisions is

generally considered to have been on furlough or leave of absence

and, as such, is entitled to crediting (restoring) of sick leave accrued,

but unused, prior to such military service.

An employee's accrued sick leave balance will be transferred when

an employee moves from employment in one state agency to another,

provided the employment is uninterrupted.

Employees who have retired from a state agency under ERS and are

reemployed by the state will not have their sick leave balance

restored. Reemployed retirees consumed their sick leave balances

when they received additional state service credit for sick leave

during the application for retirement process with ERS. Retirees

receive an increase in annuity benefits because of the sick leave

balances that were added to service credit.

A terminating employee may, with the agreement of the employing

agency, remain on the payroll after the last day worked to use

vacation leave in lieu of being paid in a lump sum, provided that

such employee will not be eligible to use paid sick leave prior to

final separation from employment.

The estate of a deceased employee is entitled to payment for one-half

of accumulated sick leave, or for 336 hours of sick leave, whichever

is less, provided that the employee had continuous employment with

the State for at least six months at the time of death. Furthermore, the

amount paid to the estate will be based on the state employee's

compensation rate at the time of his or her death. An emolument in

lieu of base pay must be included in the compensation rate if the

employee was eligible for the emolument on the last day of

employment. Neither longevity pay nor hazardous duty pay may be

included in the compensation rate.

Extended Sick Leave:

Exceptions to the amount of sick leave an employee may take can be

authorized by the administrative head or heads of any state agency

only after a review of the merits of each individual case is completed.

All agencies are required to have a written statement filed with the

State Auditor covering the policies and procedures used for the

extension of sick leave in this manner, and the agencies must make

this statement available to all employees. Agencies should ensure

their policies and procedures for extended sick leave do not have

provisions that require employees to pay back extended sick leave; to

do so would suggest that the agency had been advancing salary to the

employee in contravention of the Texas Constitution.

Sick Leave Pool:

The governing body of each state agency is required to establish a

program within the agency to allow an employee to voluntarily

transfer earned sick leave time to a sick leave pool administered by a

person appointed by the governing body of the agency for that

purpose. Contributions of sick leave must be in increments of eight

hours with the exception of a retiring state employee who may

contribute accrued sick leave in increments of less than eight hours.

The sick leave pool is intended to help employees and their families

if a catastrophic illness or injury forces an employee to exhaust all

leave time earned by that employee and to lose compensation from

the State for the employee.

The determination of which injuries or illnesses are classified as

catastrophic is made by the trustee of the State Employee Uniform

Group Insurance Benefits Program established under the Texas

Employees Uniform Group Insurance Benefits Act. The Employees

Retirement System of Texas has defined "catastrophic" in the

following way:

"A severe condition or combination of conditions affecting the

mental or physical health of the employee or the employee's

immediate family that requires the services of a licensed

practitioner for a prolonged period of time and that forces the

employee to exhaust all leave time earned by that employee

and to lose compensation from the State for the employee."

Licensed practitioner means practitioner, as defined in the Texas

Insurance Code, who is practicing within the scope of his or

her license.

Texas Government Code § 661.202 defines immediate family as

1. An individual who resides in the same household as the

employee and is related to the employee by kinship, adoption,

or marriage

2. A foster child of the employee who resides in the same

household as the employee and who is under the

conservatorship of the Department of Protective and

Regulatory Services

3. A minor child of the employee, regardless of whether the child

lives in the same household.

An employee's use of sick leave to care for and assist members of the

employee's family who are not described above is "strictly limited to

the time necessary to provide care and assistance to a spouse, child,

or parent of the employee who needs the care and assistance as a

direct result of a documented medical condition."

An employee is eligible to use the time contributed to the sick leave

pool if, because of a catastrophic injury or illness, the employee has

exhausted all the sick leave time to which that employee is otherwise

entitled.

Holidays that occur during the use of sick leave pool are counted just

like regular sick leave; if a person is sick on a holiday, the person

receives "holiday pay" for that particular day, not "sick leave pay."

The employee may transfer to the pool one or more days of accrued

sick leave time. A retiring employee may designate the number of

accrued sick leave hours, in increments of 20 days, or 160 hours for

one month of service credit, to be used for retirement credit and the

number of hours to be donated on retirement to the sick leave pool.

An eligible employee may withdraw from the pool only with the

approval of the pool administrator. If the employee is seeking to

withdraw time because of a catastrophic illness or injury, the

employee must provide the pool administrator with a written

statement from a licensed practitioner who is treating the employee

or the employee's immediate family member. The statement must

provide sufficient information regarding the illness or injury to

enable the pool administrator to evaluate the employee's eligibility.

An eligible employee may not draw time from the agency sick leave

pool in an amount that exceeds one-third of the total amount of time

in the pool or 90 days, whichever is less. The pool administrator will

determine the exact amount of time that an eligible employee may

draw from the pool.

Agencies should ensure that their sick pool policy is not in conflict

with their extended sick leave policy required under the Texas

Government Code, Section 661.202(i).  

Education Service Centers and Leave

Personal Leave: A regional education service center is required

to accept the transfer of personal leave by an employee who

was formerly employed by the State (Education Code Section

8.007). The personal leave will be converted to sick leave in

the education service center. Education Code Section 22.003

awards personal leave to certain state employees. These

employees are teachers at the School for the Deaf (Education

Code Section 30.024) and teachers at the School for the Blind

and Visually Impaired (Education Code Section 30.055).

Although employees in the schools in the Texas Department

of Criminal Justice accrue personal leave, this leave is not

transferable since those employees are not considered state

employees.

Vacation Leave: Vacation leave may not be transferred to

education service centers since they are not considered state

agencies. Accordingly, state employees who are transferring to

education service centers should be paid for any accumulated

vacation leave that has not been exhausted.

Sick Leave: Sick leave may not be transferred to education

service centers since they are not considered state agencies.

Any sick leave balances remaining to the employee would be

forfeited. However, some education service centers have

policies that allow them to give credit for sick leave as a

hiring incentive for employees who were formerly employed

by the State.

Sick leave may be transferred from education service centers to

state employment [according to Education Code Section

8.007(b)] at a rate not to exceed five days per year for each

year of employment.

Family and Medical Leave

The Family and Medical Leave Act provisions, first added to the

Appropriations Act during the 73rd Legislature, were modified

slightly during the 74th Legislature. These provisions were

established to ensure that the State of Texas, as an employer, would

be in full compliance with the entitlement established by the Family

and Medical Leave Act (FMLA). This law took effect on August 5,

1993, and is enforced by the U.S. Department of Labor, Wage and

Hour Division (DOL-WHD) which issued FMLA final regulations

that became effective April 6, 1995.

For purposes of Family and Medical Leave, an eligible employee is

one who has been employed by the State for at least 12 months and

who has worked for at least 1,250 hours during the 12 months

immediately preceding the start of leave. According to Title 29 Code

of Federal Regulations § 825.108, a state or a political subdivision of

a state constitutes a single employer for purposes of determining

employee eligibility for FMLA. If agencies have to determine

eligibility for an employee who transfers from another agency, they

should collect that information from the former agency. Therefore,

employment with a previous agency and the current agency must be

combined to determine if an employee met the eligibility criteria of

12 months or 1,250 hours of service during a 12 month period

preceding the commencement of the leave. Agencies should also

check to determine if the employee might have already taken any

FMLA leave while previously employed. Eligible employees are

entitled to FMLA leave provided they use all of their paid vacation

and sick leave while taking the FMLA leave

In a revised interpretation, the State Auditor's Office has stated that

sick leave may be used for the adoption of a child under three years

of age. Sick leave may be used in conjunction with FMLA leave

when a child under the age of three is adopted regardless of whether

the child is actually sick at the time of adoption. Additionally, a state

employee who is the father of a child, may use his sick leave in

conjunction with the child's birth only if the child is actually ill or to

care for his spouse while she is recovering from labor and delivery.

Employees who apply for FMLA leave and are receiving temporary

disability benefit payments or workers' compensation benefits cannot

be required to use their paid vacation or sick leave prior to taking

FMLA leave. Employees who are presently on FMLA leave and are

receiving temporary disability payments or workers' compensation

benefits may elect to use their paid vacation or sick leave while on

FMLA leave.

FMLA provides that all eligible employees are entitled to a total of

12 weeks of leave during any 12 month period for one or more of the

following reasons:

1. For the birth of a son or daughter and to care for the newborn

child

2. For the placement with the employee of a son or daughter for

adoption or foster care

3. To care for the employee's spouse, child, or parent with a

serious health condition

4. Because of a serious health condition that makes the employee

unable to perform the functions of his or her job

Other FMLA provisions are as follows:

1. An employee who takes leave under the law must be returned

to the same job or a job with equivalent status and pay.

2. The employer must continue the employee's health benefits

during the leave period at the same level and conditions as if

the employee had continued work.

3. The employer can require an employee to provide a doctor's

certification of the serious health condition.

4. FMLA leave does not have to be used consecutively; it may be

used intermittently.

5. The DOL has provided the following guidance concerning

holidays occurring while an employee is on FMLA.

If an employee takes FML in one continuous block and a

holiday or closing occurs during the employee's time off, the

holiday or closing will count as part of the employee's FML

entitlement. That is, just because the business/agency is closed

for MLK Day, San Jacinto Day, or a freak ice storm in

Harlingen does not buy them one more day. According to the

Code of Federal Regulations (29 CFR 825.200) the only

exception is when the entire business ceases operation for at

least a week, such as Spring Break for schools or an agency-

wide shutdown. Note that the regulation says the closure must

last at least one week.

Holidays, ice days, shutdowns, etc. do not count against

employees who are on an intermittent or reduced leave

schedule.

FMLA contains more specific provisions, including those for

intermittent leave and leave on a reduced schedule, and definitions

including spouse, parent, son, daughter, and serious health condition.

An employee does not have the option of choosing whether or not to

designate leave as FMLA leave for a qualifying event, as interpreted

by the State Auditor's Office. In all circumstances, it is the

employer's responsibility to determine whether leave qualifies as

FMLA leave.

Title 29 of the Code of Federal Regulations, Section 825.207(i), does

not permit FLSA compensatory time to be used towards FMLA

leave. If an employee elects to use FLSA compensatory time while

out on FMLA leave, that time is not counted toward the FMLA 12-

week entitlement.

In accordance with FMLA regulations issued by the DOL-WHD,

Section 825.200 (b), state agencies and institutions of higher

education are permitted to choose any one of the following four

methods for determining the "12 month period" in which the 12

weeks of leave entitlement occurs:

1. A calendar year

2. Any fixed 12-month "FML year" (for example, a fiscal year or

an employee's "anniversary" date)

3. A 12-month period measured forward from the date an

employee's first FML begins

4. A rolling 12-month period measured backward from the date

an employee uses any FML

After paid leave is used, the State will continue to pay for its portion

of an employee's coverage under the group health plan during any

full calendar months of leave without pay which may be taken during

FMLA leave.

An employee on FML is not entitled to accrue state service credit for

any full calendar months of leave without pay taken while on FML

and does not accrue vacation or sick leave for such months of leave

without pay. Further, any full calendar months of leave without pay

are not included in the calculation of the minimum number of

continuous months of employment under the merit increase

provisions set forth in Texas Government Code, Section 659.255,

and under the employee vacations and leave provisions in Texas

Government Code, Section 661.152.

Parental Leave

Employees with less than 12 months of state service or less than

1,250 hours of work in the 12 months immediately preceding the

start of leave are entitled to a parental leave of absence, not to exceed

12 weeks (480 hours), if the employee uses all available and

appropriate paid vacation and sick leave while taking the parental

leave. Such parental leave may only be taken for the birth of a

natural child or the adoption or foster care placement with the

employee of a child under three years of age. The leave period begins

with the date of birth or the adoption or foster care placement. Sick

leave may be used when a child under the age of three is adopted

regardless of whether the child is actually sick at the time of

adoption.

The Federal Pregnancy Discrimination Act of 1978 provides that

discrimination on the basis of pregnancy, childbirth, or related

medical conditions constitutes unlawful sex discrimination under

Title VII of the Civil Rights Act of 1964 as amended. The Act states

women affected by pregnancy or related conditions must be treated

in the same manner as other applicants or employees with similar

abilities or limitations.

Combining Family Medical and Parental Leave

Parental leave was designed with less stringent time requirements

than the Family Medical Leave Act. It is only available to employees

with less than 12 months of state service or who worked fewer than

1,250 hours during the 12 month period preceding the beginning of

parental leave. The statute states parental leave "begins with the date

of the birth of a natural child or the adoption or foster care placement

of a child under three years of age." Further, parental leave must be

taken during the 12 weeks beginning on the date of birth of a natural

child by the employee or the adoption or foster care placement with

the employee.

Family medical leave is only available to employees with more than

12 months of state service and may be used (among other reasons)

"for the birth or placement of a child for adoption or foster care."

Since eligibility time requirements for the two types of leave are

different, an employee would meet the requirements for either

parental leave or family medical leave, not both, so the two types of

leave could not be taken back-to-back for the same event.

There are certainly circumstances where an employee could take

parental leave, return to duty, and subsequently be eligible for FMLA

leave. The employee could then take FMLA leave for the birth,

adoption, or foster placement of a child or for a reason not related to

the birth, adoption, or foster placement of a child.

Foster Parent Leave

A state employee who is a foster parent to a child under the

conservatorship of the Department of Protective and Regulatory

Services (DPRS) is entitled to a leave of absence with full pay for the

purpose of attending staffing meetings held by the DPRS regarding

the employee's foster child. In addition, the employee may attend,

with a paid leave of absence, the Admission, Review, and Dismissal

(ARD) meeting held by a school district regarding his or her foster

child.

Parent-Teacher Conference Leave

An employee may use up to eight hours of sick leave each calendar

year to attend parent-teacher conference sessions for the employee's

children who are in pre-kindergarten through 12th grade. Employees

must give reasonable notice of intention to use sick leave to attend

such conferences. Part-time employees receive Parent-Teacher

Conference Leave on a proportional basis.

Emergency Leave

An employee shall be granted emergency leave by an agency's

administrative head for a death in the employee's family. An

employee's family is defined as the employee's spouse, the

employee's and the spouse's parents, children, brothers, sisters,

grandparents, and grandchildren. An agency head may grant

emergency leave for other reasons determined to be for good cause.

Administrative Leave for Outstanding Performance

Administrative leave with pay may be granted by the head of an

agency as a reward for outstanding performance as documented by

employee performance appraisals. The total amount of such

administrative leave granted may not exceed 32 hours during any

fiscal year. The State Auditor's Classification Office has opined that

executive directors of state agency are not eligible for administrative

leave for outstanding performance

Military Leave

State employees are eligible for the following types of leave for

military service: (1) authorized training or duty for members of the

state military forces and members of any of the reserve components

of the United States Armed Forces, (2) call to National Guard active

duty by the Governor, and (3) national emergency active duty for a

member of a reserve branch of the U.S. armed forces.

Adjusted Work Schedule: To facilitate participation in military

duties by state employees, each state agency shall adjust the work

schedule of any employee who is a member of the Texas National

Guard or the United States Armed Forces Reserve so that two of the

employee's days off work each month coincide with two days of

military duty to be performed by the employee.

Authorized Training for Duty: A state employee who is called to

active duty or authorized training as a member of the state military

forces or any of the reserve components of the United States Armed

Forces is entitled to a leave of absence from his or her respective

duties for not more than 15 days in each federal fiscal year without

loss of time, efficiency rating, vacation time, or salary.

The Attorney General has held that the 15 days need not be

consecutive and "members of the state military forces or members of

reserve components of the U.S. Armed Forces who are ordered to

duty by proper authority on nonconsecutive days are entitled to 15

days total." This same opinion also holds that 15 days refers to

working days and not calendar days.

In 1979, the State Auditor wrote,"after exhausting the 15 days of

military leave, the employee may use accrued vacation leave to the

extent available or be placed in a leave without pay status (or a

combination of the two) for the remainder of the active duty period."

A 1979 Attorney General Opinion stated, "a state employee who is

engaged in 'authorized training duty' in the state military forces is

entitled to receive compensation for up to 15 working days per year

during which he is absent from his regular employment."

Call to National Guard Active Duty by the Governor: A state

employee who is called to active duty as a member of the National

Guard by the Governor because of a state emergency is entitled to

receive emergency leave without loss of military or annual leave.

Such leave will be provided with full pay. The State Auditor's Office

has interpreted that this time is not limited and does not count against

military leave or annual leave.

Call to National Duty, U.S. Armed Forces Reserve Branch: An

employee called to active duty during a national emergency by a

reserve branch of the U.S. Armed Forces is entitled to an unpaid

leave of absence. However, the employee retains any accrued sick or

vacation leave and will be credited with those leave balances upon

return.

Restoration of Employment: Any employee who is restored to a

position upon returning from military service is considered to have

been on furlough or leave of absence during his or her time of federal

or state military service. The employee is entitled to participate in or

other benefits to which a public employee is or may be entitled.

To be eligible for restoration to his or her previous employment upon

returning from military service, the employee must have been

honorably discharged no later than the fifth anniversary of the date of

induction, enlistment, or call to active military service, and be

physically and mentally qualified to perform the duties of that

position.

The Attorney General has ruled that state employees returning to

work following military service under restoration provisions are

entitled to include time spent on active duty with longevity of

employment (state service credit) for purposes of vacation and sick

leave entitlement. Returning employees do not accrue vacation or

sick leave while on active military duty and are not considered

employed by the State.

Volunteer Firefighter and Emergency Medical Services Training

Leave

Volunteer firefighters and emergency medical services volunteers

will be granted a paid leave of absence not to exceed five working

days each fiscal year for attending training schools conducted by

state agencies. This leave of absence may also be granted to

volunteer firefighters or emergency medical services volunteers for

the purpose of responding to emergency fire or medical situations if

the agency or institution has an established policy for granting the

leave time.

Certified American Red Cross Activities Leave

Any state employee who is a certified disaster service volunteer of

the American Red Cross, or who is in training to become such a

volunteer, may be granted a leave of absence not to exceed ten days

each year to participate in specialized disaster relief services. The

employee must have supervisory authorization in addition to a

request from the American Red Cross and the approval of the

Governor's Office. If the above conditions are met, the employee will

not lose pay, vacation time, sick leave, earned overtime, and/or

compensatory time during such leave. The pool of certified disaster

volunteers must not exceed 350 participants at any one time.

Leave for Employees with a Disability

A state employee who is a person with a disability as defined by

Human Resources Code, Section 121.002, will be granted a paid

leave of absence not to exceed ten days each fiscal year for the

purpose of attending a training program to acquaint the employee

with an assistance dog to be used by the employee.

Payment of Accrued Leave of Deceased Employees

The estate of an employee who dies while employed by the State is

entitled to payment for all of the employee's accumulated vacation

leave and to one-half of the employee's accumulated sick leave, or

336 hours of sick leave, whichever is less. The payment is calculated

at the salary rate paid to the employee at the time of death.

The estates of appointed officers or employees of a state agency who

normally work at least 900 hours per year, including hourly and

temporary state employees, are eligible for this benefit. For this

purpose, the term "state employee" includes a person employed by

the Teacher Retirement System, the Texas Education Agency, the

Texas Higher Education Coordinating Board, the Texas National

Research Laboratory Commission, the Texas School for the Blind

and Visually Impaired, the Texas School for the Deaf, the Texas

Youth Commission, the Windham School District of the Texas

Department of Criminal Justice, or the Texas Rehabilitation

Commission. The term "state employee" also includes a classified,

administrative, faculty, or professional employee of a state agency or

institution of higher education who has accumulated vacation leave,

sick leave, or both, during the employment.

The term "state employee" does not include:

A person who holds an office normally filled by vote of the

people

A person employed on a piecework basis

An operator of equipment or a driver of a team whose wages are

included in the rental paid by a state agency to the owner of

the equipment or team

A person covered by the Judicial Retirement System (Plan One

or Plan Two)

A person covered by the Teacher Retirement System (except for

state employees noted in the paragraph above)

An independent contractor or the employee of an independent

contractor

In 1929, the Attorney General ruled "a day begun is a day done."

Thus, the Comptroller pays a full day's wages to an employee who

begins, but does not finish, a work day. If an employee dies during a

work day, his survivors are entitled to receive compensation for the

last day of service, even though the employee had not worked every

hour during that day. Similarly, the survivors of an annuitant who

dies on the last day of a quarter are entitled to receive an annuity for

the entire quarter.

A deceased state employee's estate is entitled to receive payment for

earned but unused (banked) Fair Labor Standards Act overtime. The

Attorney General ruled in 1976 that the estate of a deceased

employee is not entitled to receive payment for earned but unused

state compensatory time. However, subsequent to the issuance of this

opinion (H-899), the Legislature made exceptions to allow for

payment of state compensatory time on a straight time basis to

employees of certain agencies and institutions of higher education

who are subject to FLSA overtime revisions.

A deceased employee's estate shall receive payment for accrued but

unused vacation leave and entitled sick leave. This payment is

computed as though the employee had actually used these leave

hours while on the agency's payroll. Any state holiday that falls

within this period should not be charged against the accrued leave

hours (i.e., holidays which fall on a recognized work day have the

effect of extending these leave hours).

Leave Without Pay

Agencies may grant a leave of absence without pay subject to the

following provisions

All such leave without pay may not exceed 12 months.

Except for disciplinary suspensions, workers' compensation, and

military situations, all accumulated paid leave entitlements

must be exhausted before granting such leaves, with the

additional provision that sick leave must be exhausted only in

those cases where the employee is eligible to take sick leave as

provided in the sick leave provisions.

Subject to fiscal constraints, approval of such leave constitutes a

guarantee of employment for a specified period of time.

An administrative head of an agency may provide exceptions to

these limitations for such reasons as interagency agreements or

educational purposes. The Attorney General said in 1985 that

the reasons stated in the leave provisions for granting

exceptions to the requirement to exhaust paid leave prior to

leave without pay "exemplify purposes for which the agency

head may allow exemptions; they do not list the purposes

exhaustively."

Any full calendar month in which an employee is on leave

without pay will not be counted in the calculation of total state

service credit for the purposes of vacation or longevity pay

entitlement, except in the case of an employee returning to

state employment from military leave without pay. No

employee will accrue vacation or sick leave for such month.

Any such full calendar month of leave without pay does not

constitute a break in the continuity of state employment, but

will not be included in the calculation of the minimum number

of continuous months of service required under merit salary

and employee vacation and leave provisions. Employees on

leave without pay for an entire month do not accrue retirement

service credit for that month.

A full-time employee or regular part-time employee who is subject to

FLSA and is on leave without pay will have his or her compensation

reduced for that particular pay period at the equivalent hourly rate of

pay times the number of work hours lost by leave without pay. FLSA

exempt employees may also be subject to salary reduction in the

same manner, in accordance with provisions set forth in the overtime

provisions of Title 29 of the Code of Federal Regulations, Section

541.188. FLSA exempt employees who are absent from work for less

than one day for personal reasons or sickness or disability under

certain conditions may be subject to a salary reduction.

Negative Leave and Compensatory Time Balances Prohibited

The State Auditor's Office has advised that a state agency must not

allow an employee to carry a negative sick leave, vacation leave, or

compensatory time balance. In 1974, the Attorney General stated that

it would be unconstitutional for a state agency to advance salary to

an employee. However, in inclement weather or other circumstances

beyond the control of the Department, the Texas Department of

Transportation is authorized to grant construction or maintenance

employees time off with pay with the hours charged to the

Compensatory Time Taken Account, provided that such advanced

time must be repaid by the employee within the following 12 months

or at termination, whichever is sooner.

Sick and Vacation Leave for Retirees Resuming State Service

The State Auditor's Office has opined that retired state employees

who return to state employment are eligible for vacation and sick

leave accruals at the same rate of accrual prior to his or her

retirement.

Payment Entitlements Upon Separation From State Employment

Type Of

Separati

on

Lump-Sum

Payment For

Further

Accrual

Of

Lump-Sum

Payment

For

Payme

nt For

Longe

vity Or

Hazar

dous

Duty

Holi

day

Pay

Gene

ral

Salar

y

Incre

ase

Accru

ed

Vacati

on

Leave

Accru

ed

Sick

Leave

Balan

ce

Vacat

ion

Leave

Sic

k

Lea

ve

Accru

ed

State

Comp

Time 6

Accru

ed

FLSA

Comp

Time

Any

separatio

n where

the

employe

e is

permitte

d to

remain

NO

(but

may

expend

accrue

d

vacatio

n prior

to

NO

(also,

not

eligibl

e to

use

sick

leave

while

NO NO NO

(AGO

H-883

dated

9-26-

76) 2

YES

(29

CFR,

Part

553)

YES 3 YES 3

YES 3

on the

payroll

to

expend

accrued

vacation

separat

ion)

remai

ning

on

payrol

l to

extend

vacati

on)

Any

separatio

n where

the

employe

e does

not

remain

on the

payroll

to

expend

accrued

vacation

YES NO N/A N/A

NO

(AGO

H-883

dated

9-29-

76) 2

YES

(29

CFR,

Part

553)

NO YES 4

NO

Any

separatio

YES

(at the

NO

(may

NO NO NO

(but

YES

(to the

YES 3 YES 3

YES 3

n where

the

employe

e is

permitte

d to

remain

on the

payroll

to

expend

accrued

state or

FLSA

compens

atory

time

time of

separat

ion)

not

use

sick

leave

while

remai

ning

on

payrol

l to

expen

d state

or

FLSA

comp.

Time) 7

may

expen

d

accrue

d state

comp.

Time

prior

to

separa

tion -

AGO

H-883

dated

9-26-

76) 2

extent

such

time

has

not

been

exhau

sted -

29

CFR,

Part

553)

Any

separatio

n where

the

employe

e does

not

remain

YES NO N/A N/A NO

(AGO

H-883

dated

9-26-

76) 2

YES

(29

CFR,

Part

553)

NO NO NO

on the

payroll

to

expend

accrued

state or

FLSA

compens

atory

time

Death

(paymen

t to

estate)

YES

YES -

for 1/2

of sick

leave

hours

not to

excee

d 336

hours

(lump-

sum

payme

nt) 5

N/A N/A

NO

(AGO

H-899

dated

11-18-

76) 2

YES

(29

CFR,

Part

553)

NO YES 4

NO

General References: Texas Government Code Ann., Sections

662.003, 661.032, 661.062, 661.067, 661.152, 659.015, 659.041.

Neither an employee nor an employee's estate may receive payment

for vacation balance if the employee has not completed six months of

continuous (unbroken) employment with the State (Texas

Government Code Ann., Sections 661.032, 661.152 and 661.062).

According to AGO JC-0302, starte employees have no vested right in

the method of calculating compensation for vacation benefits that

pre-dated the amendment of section 661.063 of the Government

Code.

2 Subsequent to the issuance of AGO H-883 and H-899, the

Legislature has made exceptions to allow for payment of state

compensatory time to employees of certain agencies and institutions

of higher education under certain circumstances (General

Appropriations Act, Article VII, Section 1, TXDOT appropriations,

Rider 11; Article II, Section 1, MHMR appropriations, Rider 20;

Texas Government Code Ann., Section 659.015

This entitlement is applicable to the period covered by the expended

accrued vacation time, state comp., or FLSA comp. time as though

the employee actually worked that time.

4 This entitlement is applicable to the period beginning on the day

following the last day of employment and ending on the last working

day through which the accrued leave (both vacation and/or sick)

would have extended.

5 An employee's estate may not receive payment for sick leave if the

employee has not completed six months of continuous (unbroken)

employment with the State at time of death (Texas Government Code

Ann., Sections 661.033; 661.152

6 This includes both state and holiday compensatory time.

7 Texas Government Code Ann., Section 661.067

Source: State Classification Office

Payment Entitlements For Employees Of Higher Education Institutions Upon

Separation from State Employment

Employme

nt Status

Vacation

Accrual

Sick

Leave

Accrua

l

State

Servic

e

Credit

Longevit

y Pay

Holiday

s

Positions

requiring

student

status as a

condition of

employment

No No Yes No No

Faculty

(Full-time

or part-time,

20 hours or

more)

No, except

those with

appointmen

ts of 12

months or

more.

Yes Yes No Yes

Non-faculty

(Full-time)

Yes Yes Yes Yes Yes

Non-faculty

(Part-time,

20 hours or

more)

Yes Yes Yes No Yes

Other than

Faculty &

Non-Faculty

No No Yes No No

HOLIDAYS

Section 662.003 of the Texas Government Code identifies three

types of holidays for state employees: national, state, and optional.

Eligible employees are entitled to a paid day off from work on

national and state holidays as specified by the Legislature. The table

entitled, State Holiday Schedule lists the holidays and their dates for

the 2002-2003 biennium.

A state employee is entitled to a paid day off from work for each

national and state holiday if:

The holiday does not fall on a Saturday or Sunday; and

The employee is not on unpaid leave.

A state employee who is a peace officer commissioned by the

Department of Public Safety and who is required to work on a

national or state holiday that falls on a Saturday or Sunday is entitled

to compensatory time off at the rate of one hour for each hour

worked on the holiday.

Holidays for State Agencies

A state agency must have enough state employees on duty during a

state holiday to conduct the public business of the agency except for

those state holidays that fall on a Saturday or Sunday, the Friday

after Thanksgiving Day, December 24th, or December 26th

Employees who actually work on a national holiday or a state

holiday will be allowed compensatory time off during the 12-month

period following the date of the holiday worked. Employees are

required to give reasonable advance notice when taking this

compensatory time; however, employees do not have to specify the

reason for the request. An employee who normally works 40 hours

per week on a schedule other than Monday through Friday, 8 A.M. to

5 P.M., is entitled to paid holiday time off that is equivalent to the

holiday time that employees who work normal schedules receive.

The holiday pay for part-time employees shall be determined on a

basis proportionate to their hours worked.

According to Texas Government Code § 662.005, "An individual

who is a state employee on the last workday [and not on leave

without pay] before or the first workday after a national or state

holiday, or on both workdays, is entitled, except as provided by

Section 662.010, to a paid day off from working for a state agency on

the holiday if: (1) the holiday does not fall on a Saturday or Sunday;

and (2) the General Appropriations Act does not prohibit state

agencies from observing the holiday." See the discussion in the

following sections for clarification.

Holiday Occurring Immediately Before a New Employee Starts

Work

According to Texas Government Code § 662.010

"An individual who is not a state employee

on the last workday before a state or

national holiday but who is an employee on

the first workday after the holiday may not

be paid for the holiday if it occurs during

the same month as the last workday before

the holiday."

Example: In this particular case a new employee starts work on

January 2, 2002. Should he or she be paid for the January 1, 2002

holiday?

The individual was not an employee on December 31st (last workday

before a state or national holiday) but was an employee on January

2nd (first workday after the holiday). The statute says the employee

"may not be paid for the holiday if it occurs during the same month

as the last workday before the holiday." The last workday before the

holiday is in December; the first workday after the holiday is in

January, different months. Accordingly, the individual is entitled to

be paid for the January 1, 2002, holiday.

December 2001/January 2002

Sunda

y

Mond

ay

Tuesday Wednesd

ay

Thursd

ay

Frida

y

Saturd

ay

23 24 25 26 27 28 29

30 31 1

HOLID

AY

2 3 4 5

Holiday Occurring Immediately Following the Last Workday of

a Current Employee

In a similar manner:

"an individual who is a state employee on the last workday

before a state or national holiday but who is not an employee

on the first workday after the holiday may not be paid for that

holiday if it occurs before the first workday of the month and

during that month."

Example: In this particular case a current employee's last work day is

December 31, 2001. Should he or she be paid for the January 1, 2002

holiday?

The individual was an employee on December 31st (last workday

before a state or national holiday) but was not an employee on

January 2nd (first workday after the holiday). The statute says the

employee "may not be paid for the holiday if it occurs before the first

workday of the month and during that month." The first workday of

the month is January 2nd, and the holiday occurs during the month of

January, both events occurring during the same month. Accordingly,

the individual may not be paid for the January 1, 2002, holiday.

Holidays for Employees in a Leave Without Pay (LWOP) Status

Employees who are in LWOP status before and after a holiday may

not be paid for the holiday. Eligibility for paid holidays for

employees who change their LWOP status either immediately

preceding or immediately following a holiday is determined the same

as if they were a new employee or a terminating employee.

In cases of a partial LWOP day, the employee will receive credit for

working the entire day. The Comptroller's office has determined that

only employees who use unpaid leave for the entire workday will be

considered on LWOP for the day.

State Holiday Schedule

Fiscal Year 2002

Holiday Agency Status Date Day of Week

Labor Day All agencies

closed

09-03-01 Monday

Rosh

Hashanah

Optional

Holiday

09-18-01 Tuesday

Rosh

Hashanah

Optional

Holiday

09-19-01 Wednesday

Yom Kippur Optional

Holiday

09-27-01 Thursday

Veteran's Day  

11-11-01 Sunday

Thanksgiving

Day

All agencies

closed

11-22-01 Thursday

Day after

Thanksgiving

All agencies

closed

11-23-01 Friday

Christmas Eve

Day

All agencies

closed

12-24-01 Monday

Christmas Day All agencies

closed

12-25-01 Tuesday

Day after

Christmas

All agencies

closed

12-26-01 Wednesday

New Year's

Day

All agencies

closed

01-01-02 Tuesday

Confederate

Heroes' Day

 01-19-02 Saturday

Martin Luther

King, Jr. Day

All agencies

closed

01-21-02 Monday

Presidents' Day All agencies

closed

02-18-02 Monday

Texas

Independence

Day

 03-02-02 Saturday

Good Friday Optional

Holiday

03-29-02 Friday

Cesar Chavez

Day

 03-31-02 Sunday

San Jacinto

Day

 04-21-02 Sunday

Memorial Day All agencies

closed

05-27-02 Monday

Emancipation

Day

Skeleton crew

required

06-19-02 Wednesday

Independence

Day

All agencies

closed

07-04-02 Thursday

LBJ's Birthday Skeleton crew

required

08-27-02 Tuesday

Fiscal Year 2003

Holiday Agency

Status

Date Day of Week

Labor Day All agencies

closed

09-02-02 Monday

Rosh Hashanah  

09-07-02 Saturday

Rosh Hashanah  

09-08-02 Sunday

Yom Kippur Optional

Holiday

09-16-02 Monday

Veteran's Day All agencies

closed

11-11-02 Monday

Thanksgiving All agencies 11-28-02 Thursday

Day closed

Day after

Thanksgiving

All agencies

closed

11-29-02 Friday

Christmas Eve

Day

All agencies

closed

12-24-02 Tuesday

Christmas Day All agencies

closed

12-25-02 Wednesday

Day after

Christmas

All agencies

closed

12-26-02 Thursday

New Year's Day All agencies

closed

01-01-03 Wednesday

Confederate

Heroes' Day

 01-19-03 Sunday

Martin Luther

King, Jr. Day

All agencies

closed

01-20-03 Monday

Presidents' Day All agencies 02-17-03 Monday

closed

Texas

Independence

Day

 03-02-03 Sunday

Cesar Chavez

Day

Optional

Holiday

03-31-03 Monday

Good Friday Optional

Holiday

04-18-03 Friday

San Jacinto Day Skeleton

crew

required

04-21-03 Monday

Memorial Day All agencies

closed

05-26-03 Monday

Emancipation

Day

Skeleton

crew

required

06-19-03 Thursday

Independence All agencies 07-04-03 Friday

Day closed

LBJ's Birthday Skeleton

crew

required

08-27-03 Wednesday

Weekend Holidays:

Offices will not be closed on another day when designated holidays

fall on a Saturday or Sunday. Such holidays will not be observed.

Skeleton Crew Holidays:

A state agency must have enough state employees on duty to

conduct business during the skeleton crew holidays listed.

Compensatory time off during the 12-month period following the

holiday worked will be allowed for this duty.

Optional Holidays:

A state employee is entitled to observe Rosh Hashanah, Yom

Kippur, and Good Friday in lieu of any state holiday where a

skeleton crew is required. An agency's administrative director may

allow employees to observe Cesar Chavez Day as a state holiday

instead of another state holiday that falls on a weekday. The agency

must remain open for business at minimum staffing levels (skeleton

crew).

Institution of Higher Education Holidays:

Institutions of higher education may establish their own holidays in

keeping with academic schedules, provided the number of holidays

granted does not exceed the number of holidays to which employees

of state agencies are entitled.

Transferring Employees and Holidays

In the event that a state or national holiday falls between the dates an

employee separates from one state agency and begins employment

with another state agency without a break in service, the agency to

which the employee transfers is responsible for paying the employee

for the holiday, regardless of whether the agency or institution of

higher education that receives the new employee recognizes the

holiday.

Optional Holidays

An individual who is a state employee on the last workday before or

the first workday after an optional holiday is entitled to a paid day off

for the optional holiday if it does not fall on a Saturday or Sunday, if

state agencies are not prohibited from observing the optional holiday,

and if that employee agrees to relinquish during that same year a

state holiday that does not fall on a Saturday or Sunday. However,

the Friday after Thanksgiving Day, December 24, and December 26

are state holidays that the employee may not relinquish in return for

paid time off during an optional holiday, since these three state

holidays do not require any agency staffing.

Holidays for Institutions of Higher Education

Only regular employees of institutions of higher education are

eligible for paid holidays. A regular employee for this purpose is

defined as someone who is employed to work at least 20 hours per

week for a period of at least four and one-half months, excluding

students employed in positions that require student status as a

condition for employment. Student employees of institutions of

higher education do not get paid for holidays.

State employees who are employed by multiple agencies and who

work more than 40 hours per

week may not accrue holiday leave at a rate that would exceed that

for a full-time, 40 hour per week employee.

Employees of institutions of higher education may be paid for

holiday compensatory time hours earned on a straight time basis

when the taking of compensatory time would be disruptive to normal

teaching, research, or other critical functions

A university may determine the days on which employees receive

paid leave for state holidays, as long as the number of holidays in a

fiscal year is the same number as the number of holidays for state

agencies as set by the Legislature.

There are at least three options regarding a university's determination

of holidays:

A university may determine all of the holidays that the

institution will celebrate and mandate those holidays for all

employees.

A university may determine some of the holidays that the

institution will celebrate and mandate those holidays for all

employees. For the remaining holidays, the university may

allow each employee to select his or her own holidays. These

"floating holidays" would be unique for each employee.

A university may allow each employee to choose all of his or her

own holidays as "floating holidays," as long as the number of

holidays in a fiscal year is the same as the number of holidays

for state agencies.

INSURANCE

Accelerated Payment of Life Insurance Benefits

The trustees of the Uniform Group Insurance Benefits Program may

adopt rules to pay accelerated life insurance benefits to a terminally

ill, terminally injured, or permanently disabled participant in

amounts that benefit the participant without increasing the costs of

providing benefits. The amount of any accelerated payment will be

deducted from the amount of the death benefit. A participant may

also enter into a viatical settlement and irrevocably designate a

beneficiary in conjunction with that settlement.

Accelerated benefits and designation of beneficiaries in conjunction

with viatical settlements are limited to group life insurance policies

delivered, issued for delivery, or renewed on or after September 1,

1997. Participants may not elect to receive an accelerated benefit or

designate a beneficiary in conjunction with a viatical settlement

before January 1, 1998.

Benefit Replacement Pay

Beginning with wages paid January 1, 1996, the State of Texas no

longer paid the federal taxes imposed on state employees and state-

paid judges under the Federal Insurance Contributions Act (FICA).

This payment was commonly known as "state-paid social security."

However, the Legislature offset the repeal of the tax payment by

providing "benefit replacement pay" (BRP) for eligible

employees.An eligible state employee is an individual who was, on

August 31, 1995:

An employee of a state agency and eligible for the state-paid

social security contribution of the employee tax under Section

606.064 of the Texas Government Code

Using unpaid leave from a state job, if the individual would have

been eligible for state payment of the employee tax had he or

she not been using his or her unpaid leave

Not working for a state agency because his or her employment

customarily did not include summer months; because the

individual had contracted with the agency before August 31,

1995, to resume working for the agency before September 2,

1995; and because the position held on September 2, 1995,

would have made the individual eligible for the state-paid

employee tax if the employee had held that position at that

time

An employee's benefit replacement pay is equal to the sum of 5.85

percent of the FICA covered wages earned by the employee during

the pay period (not to exceed $16,500)and an amount equal to the

additional retirement contribution paid by the employee because of

the benefit replacement pay. The amount paid on the behalf of

eligible employees, not including the retirement contribution, may

not exceed $965.25 each calendar year.

State employers have the option of offering benefit replacement pay

on behalf of their employees in equal installments during the

calendar year. If the employer so chooses, employees who will be

receiving $965.25 in benefit replacement pay may opt to be paid in

the equal installments. However, if an employee chooses the equal

installment payments and terminates or leaves his or her employment

before the end of the year, he or she will not be paid the difference

between the benefit replacement pay received and the amount he or

she would have received had he or she not chosen the installment

plan. Also, an eligible employee who leaves state employment after

August 31, 1995, for at least 12 consecutive months before returning,

is ineligible to receive benefit replacement pay.

Law Enforcement Officers and Firefighters Survivors' Benefits

Article III, Section 51(d) of the Texas Constitution empowers the

Legislature to provide assistance payments to eligible survivors of

certain officers who "because of the hazardous nature of their duties,

suffer death in the course of the performance of their duties." Section

615.003 of the Texas Government Code defines eligible officers,

firefighters, and other employees. Eligible survivors may include the

surviving spouse; a child; or, a surviving parent, if there is no

surviving spouse or child.

A surviving spouse may receive $250,000. If there is no eligible

surviving spouse, the State shall pay $250,000 in equal shares to

surviving children. A surviving parent may receive $250,000 if he or

she is the only surviving parent. If there are two surviving parents,

each will receive equal shares.

A surviving spouse or a surviving child is eligible to receive

education benefits. The child must be claimed as a dependent on the

income tax return filed with the Internal Revenue Service by the

listed individual in the year preceding the year in which the listed

individual died. An eligible person who enrolls as a full-time student

at an institution of higher education is exempt from tuition and fees

at that institution of higher education until the student receives a

bachelor's degree or 200 hours of course credit, whichever occurs

first. If the student elects to reside in housing provided by the

institution of higher education and qualifies to reside in that housing,

the institution shall pay the cost of the student's contract for food and

housing until the student receives a bachelor's degree or 200 hours of

course credit, whichever occurs first. If there is no space available in

the institution's housing, the institution shall pay to the student each

month the equivalent amount that the institution would have

expended had the student lived in the institution's housing. The

institution is not required to pay the student the monthly payment if

the student would not qualify to live in the institution's housing. The

institution of higher education shall pay to the student the cost of the

student's textbooks until the student receives a bachelor's degree or

200 hours of course credit whichever occurs first. These education

benefit payments are in addition to any payment made under

Government Code Section 615.022, Payments to Eligible Survivors.

Additionally, as permitted by Texas Government Code Section

615.121, the state will shall pay the funeral expenses related to the

deceased officer or employee and an annuity to an eligible surviving

spouse of a peace officer or an employee of the institutional division

or state jail division of the Texas Department of Criminal Justice, as

described by Texas Government Code Section 615.003(1) or (6),

who was killed in the line of duty and who had not qualified for an

annuity under an employees' retirement plan The annuity will consist

of monthly payments that equal the greater of:

the monthly annuity payment the deceased officer or employee

would have received if the officer or employee had survived,

had retired on the last day of the month in which the officer or

employee died, and had been eligible to receive an annuity

under an employees' retirement plan; or

the minimum monthly annuity payment the deceased officer or

employee would have received if the officer or employee had

been employed by the state for 10 years, had been paid a

salary at the lowest amount provided by the General

Appropriations Act for a position of peace officer or employee

of the institutional division or state jail division of the Texas

Department of Criminal Justice, as described by Section

615.003(1) or (6), and had been eligible to retire under the

Employees Retirement System of Texas.

The surviving spouse is entitled to continue to receive monthly

payments under Subsection (a) until the earlier of:

the date the surviving spouse remarries;

the date the surviving spouse becomes eligible for retirement

under an employees' retirement plan; or

the date the surviving spouse becomes eligible for Social

Security benefits.

Survivor benefits under this provision are administered by the Board

of Trustees of the Texas Employees Retirement System and are

available to the eligible survivors of the following:

Individuals who are elected, appointed, or employed as peace

officers by the State or a political subdivision of the State

under Article 2.12, Code of Criminal Procedure, or other law

Custodial personnel of the Texas Department of Criminal Justice

(TDCJ)

Jailers or guards of a county jail who are appointed by the

sheriff; who perform a security, custodial, or supervisory

function over the admittance, confinement, or discharge of

prisoners; and who are certified by the Texas Commission on

Law Enforcement Officer Standards and Education

Juvenile correctional employees of the Texas Youth Commission

Employees of the Texas Department of Mental Health and

Mental Retardation who work at the department's maximum

security unit, or who perform on-site services for TDCJ

Paid aircraft crash and rescue firefighters

Members of organized volunteer fire departments that are not

paid, that have more than 20 active members, and that conduct

a minimum of two drills each month for two hours each

Any employees of the State or a political or legal subdivision

who are subject to certification by the Texas Commission on

Fire Protection

Members of an organized police reserve or auxiliary unit

Paid jailers

Parole officers employed by the pardons and paroles division of

the Texas Department of Criminal Justice who perform duties

under Article 42.18, Section 2 and who have the qualifications

under Section 19 of the Code of Criminal Procedure, or in

prior law

Liability Insurance

The Legislature authorized all state agencies owning or operating

motor vehicles, any type of power equipment, aircraft, or watercraft

to provide liability insurance for their officers and employees. If an

agency requires liability insurance but does not provide it, an

employee may be reimbursed from agency maintenance funds for

any amount spent on liability insurance.

Social Security Benefits

State agencies were formerly authorized to pay a portion of

employee contributions on social security coverage of their

employees. However, the 74th Legislature amended the Texas

Government Code to the effect that state employees are required to

pay contributions on wages in the amount of the employee tax

imposed by Section 3101 of the Internal Revenue Code of 1986 (29

U.S.C. Section 3101).

Employees who, on August 31, 1995, had their social security

contributions paid for by the State under the authorization of the

previous law are entitled to benefit replacement pay according to

Section 659.124 of the Texas Government Code.

State Kids Insurance Program (SKIP)

State agencies are required to provide each employee with

information regarding the State Kids Insurance Program (SKIP) and

Medicaid. When offering insurance to employees, agencies must

provide separate literature, including eligibility requirements and

prices, for SKIP and Children's Medicaid. The outreach shall be

performed at least annually during open enrollment (beginning with

the summer of 2001), and with any new state employee at the time of

hiring.

The State Kids Insurance Program (SKIP) introduced September 1,

2000, provides a 30% supplement toward the health insurance

premiums of eligible children of full-time (and higher education)

employees and 15% toward the health insurance premiums of

eligible children of part-time state employees.

The SKIP supplement is available to state and higher education

employees participating in the state insurance program who:

Meet eligibility criteria according to family income and size,

Are not eligible for Medicaid,

Are U.S. citizens or legal residents, and

Have UGIP-eligible children under the age of 19 living with

them in Texas.

A dependent child of a state employee whose family income meets

specified requirements and is not eligible for the state Medicaid

program may have a portion of his or her healthcare premium paid

directly by the State.

Children's Health Insurance Program (CHIP)

CHIP is designed for families who earn too much money to qualify

for Medicaid health care, yet cannot afford to buy private insurance.

The parents in some of these families have jobs that do not offer

health insurance for children. Other parents' jobs offer health

insurance, but the insurance is so expensive that families cannot

afford it

State employees need to be aware of the difference between CHIP

and SKIP. Both programs have been designed for families who earn

too much money to qualify for Medicaid health care. Both programs

have also been designed to meet the needs of children. However,

SKIP is designed for employees covered by the state's insurance

program. CHIP is comparable, but is for children whose parents are

not covered by the state's insurance program.

State Paid Medical Care

In 1959, the Legislature authorized the appropriation of public funds

to pay for drug, medical, hospital, laboratory, and funeral expenses

incurred by state employees injured or killed while performing

assigned governmental functions or when exposed to unavoidable

dangers resulting from the performance of their work. State agencies

may only spend funds for expenses incurred by employees under

their control, but only "to the extent authorized by an appropriation

for the purpose."

Long-Term Care Insurance Program

The Employees Retirement System (ERS) has been authorized to

establish a group long-term care insurance program to provide long-

term care insurance coverage for: an employee, including a retired

employee; a spouse of an employee, including a retired employee; a

parent or grandparent of an employee, including retired employee;

and the parent of a spouse of an employee, including a retired

employee. ERS members and employees of institutions of higher

education are covered under this law.

The program participant is responsible for the required payment. The

premiums and program cost may not be deducted from an employee's

monthly compensation or a retired employee's annuity. This group

long-term care insurance program is not part of the group coverages

offered under the Texas Employees Uniform Group Insurance

Benefits Act, and the State may not contribute any part of the

premiums for coverage offered under this article.

Unemployment Compensation

State employees are covered by unemployment insurance in Texas

unless they are in the employ of a political subdivision, or of an

instrumentality of a political subdivision that is wholly owned by one

or more political subdivisions, as an elected official; a member of a

legislative body; a member of the judiciary; a temporary employee in

case of fire, storm, snow, earthquake, flood, or similar emergency; or

in a position that is designated under law as a major non-tenured

policy-making or advisory position that ordinarily does not require

more than eight hours of service each week.

The State of Texas has elected to reimburse the unemployment

compensation fund administered by the Texas Workforce

Commission (Commission) for benefits paid to former employees

rather than to pay taxes into the fund. Therefore, if a claim is

approved for payment, a state agency will be billed on a quarterly

basis for all benefits based on wages reported by it during the base

period of the claim.

The law provides that an employer respond to the notice of initial

claim within 14 days following the mailing date of the notice. A

failure to do so results in the waiver of all rights in connection with

the claim, including the right to appeal a determination by the

Commission allowing payment of benefits. An employer must file a

timely protest of initial claim in order to protect its status as a party

of interest to the claim.

Benefit Wage Credits: An individual's unemployment benefits are

based on the wages reported to the Commission by employers during

the base period of initial claim. The Commission credits an

individual's wages received during the individual's base period as

benefit wage credits.

Unemployment Eligibility: Individuals who are eligible to receive

unemployment benefits must:

Have registered for work and continue to report to an

unemployment office

Have filed a claim for benefits in accordance with Commission

rules

Be able and available to work

Make an active search for work

Participate in required reemployment activities

Have benefit wage credits in at least two calendar quarters and in

an amount totaling not less than 37 times the weekly benefit

amount to which they are entitled

Have earned wages totaling at least six weeks times their weekly

benefit amount since the beginning date of their most recent

prior benefit year

Have been totally or partially unemployed for a waiting period

of at least seven consecutive days (Benefits will be paid for

this waiting period week after the individual has been paid

three times his weekly benefit amount.)

Disqualification for Benefits: An otherwise eligible individual can

be disqualified from receipt of benefits based upon the reason for the

last separation from work prior to the filing of the initial claim for

benefits. The law provides that an individual be disqualified if the

last work separation was due to a voluntary quit without good cause

connected with the work or if the individual was discharged for

misconduct connected with the work. The disqualification continues

until the individual has returned to employment and worked for six

weeks or has earned six times his weekly benefit amount, unless the

individual quit the last work in order to relocate with a spouse, in

which case the disqualification will be assessed a minimum of six

weeks but can be applied for a maximum of 26 weeks.

An individual will not be disqualified if the individual left the last

work because of:

A medically verified illness of the individual or the individual's

minor child (only if reasonable alternative care was not

available to the child and the employer refused to allow the

individual a reasonable amount of time off during the illness)

Injury

Disability

Pregnancy

Total and Partial Unemployment: An individual is totally

unemployed in a benefit period in which the individual "does not

perform services for wages in excess of the greater of $5 or 25

percent of the benefit amount." Individuals who have any earnings

during the period for which they are filing claims for benefits must

report those earnings to the Commission. Individuals may be eligible

for partial benefits. The amount of benefits payable to a partially

unemployed individual is equal to the individual's benefit amount,

plus the greater of $5 or 25 percent of the benefit amount, minus the

amount of the gross wages earned by the individual during the

benefit period. An individual is not considered unemployed and is

not eligible to receive benefits for any benefit period during which

the individual works the individual's customary full-time hours,

regardless of the amount of wages the individual earns during the

benefit period.

Weekly and Maximum Benefit Amounts: The maximum benefit

amount an eligible individual may be paid during a benefit year may

not exceed 26 times the individual's weekly benefit amount or 27

percent of the total base period wage credits, whichever is less. The

weekly benefit amount is 1/25th of the highest quarter of wages in the

individual's base period or the maximum benefit amount established

for that year, whichever is less. Effective September 1, 2001, the

benefit amount for a totally unemployed individual will not exceed

47.6 percent of the average weekly wage in covered employment in

this State. The minimum weekly benefit amount is 7.6 percent of the

average weekly wage in covered employment in this State. Each

October, these amounts are adjusted annually based on the annual

average of the weekly wage in Texas for the preceding year.

Individuals who have exhausted their regular benefits may apply for

extended benefits provided the State is in an extended benefits

period.

Out-of-State Employment: The Commission is authorized to enter

into agreements with agencies of other states or a federal agency by

which an employee who is performing services in this state and in

any other state(s) is considered to be employed entirely in this state;

in one of the other states in which the individual performs services;

in the state of the individual's residence; or in the state in which the

employing unit maintains a place of business.

Likewise, the Commission may enter into reciprocal agreements with

agencies of other states under which an employee who is employed

by this state and who performs services in another state is considered

to be employed entirely in this state. If no agreement is reached, the

employing agency shall become a reimbursing employer. If the

agency is not permitted by law to be a reimbursing employer, the

agency may pay the required contribution for that employee from

available funds.

Uniform Group Insurance Program

In 1975, the 64th Legislature passed the Texas Employees Uniform

Group Insurance Act, thereby establishing a comprehensive

insurance program whose primary purpose is "to provide uniformity

in life, accident, and health benefits coverages on all employees of

the State of Texas and their dependents."

Except for the conditions explained in Article 3.50-2, Section 13A of

the Texas Insurance Code, no employee eligible to receive the full

state contribution may be denied the basic coverage offered by the

Uniform Group Insurance Program (UGIP), unless the employee

waives the coverage with a written statement. Employees on FMLA

leave are entitled to continue receiving the state contribution to the

UGIP and may keep all the coverages they had while working,

except disability coverages. Employees on FMLA leave are

responsible for paying their out-of-pocket premiums on the first of

each month.

Prior to the 72nd Legislative Session in 1991, all active and retired

state employees were allowed to participate in the UGIP, except for

those working for an institution of higher education. The 72nd

Legislature altered this exception, passing legislation that placed

employees of almost all institutions of higher education under the

auspices of the UGIP. Given the option by the Legislature, Texas

Tech University and the University of Houston System elected to

participate in the UGIP. However, individuals employed by the

University of Texas System and the Texas A&M University System

may not participate in the UGIP. These two institutions of higher

education participate in the Texas State College and University

Employment Uniform Insurance Benefits Program. A person who

has at least eight years of creditable legislative service, or ending

service in the Legislature, or a person who has ten years creditable

service as a legislative employee, or ending service in the

Legislature, continues to be eligible to participate in the UGIP.

An employee or retiree is entitled to secure for his or her dependents

any uniform group coverage provided for employees by UGIP. A

"dependent" is the spouse of an active or retired employee, or an

unmarried child under 25 years of age, including:

An adopted child

A stepchild

A foster child who is not covered under another governmental

health plan

Other child who is in a regular parent-child relationship

A child who is considered a dependent for federal income tax

purposes and who is a child of the employee's or retiree's child

An eligible child for whom the employee or retiree must provide

medical support pursuant to a valid order from a court of

competent jurisdiction

Any such child, regardless of age, who is mentally retarded or

physically incapacitated to such an extent as to be dependent

upon the employee for care or support.

The unmarried dependent child of an employee or retiree, regardless

of age, on expiration of the child's continuation of health benefits

coverage under COBRA, is eligible for reinstatement of health

benefits coverage at a rate sufficient to cover the full cost of the

coverage. The cost of this coverage will be paid by the child or the

child's participating parent.

A surviving dependent of an employee or retiree who is entitled to

monthly benefits may, following the death of the employee, elect to

retain authorized coverages at the group rate for employees, provided

that such coverage was previously secured by the employee or retiree

for the dependent, and the dependent directs the applicable

retirement system to deduct required contributions from the monthly

benefits paid the surviving dependent by the retirement system or

agrees to pay required contributions directly to the Retirement

System.

Section 4 of Article 3.50-2 names the trustee of the UGIP as its

administrator. The trustee is authorized to appoint an advisory

committee as it considers necessary to assist it in performing its

duties.

The trustee is authorized, empowered, and directed to establish plans

of group coverage which may include, but are not limited to, the

following:

Group term life coverage

Accidental death and dismemberment

Health benefit plans, including, but not limited to, hospital care

and benefits

Surgical care and treatment

Medical care and treatment

Dental care

Obstetrical benefits

Prescribed drugs

Medicines

Prosthetic devices and supplemental benefits, supplies, and

services

The UGIP trustee is also authorized to establish a "cafeteria plan" for

state employees. The cafeteria plan that the trustee put into action,

"TexFlex," requires employees to pay UGIP premiums, eligible

health care expenses, and eligible dependent care expenses with pre-

tax, rather than after-tax, dollars.

The state contribution to group insurance for general state employees

for fiscal years 2002 and 2003 is provided in the General

Appropriations Act, Article I, Section 1, Employees Retirement

System (5). The state contributions for the various levels of coverage

are presented in the table below. State agencies and institutions of

higher education are required to make timely payments to the ERS

and reconcile coverages and payments monthly.

If the cost of the basic coverage exceeds the amount of the state's

contribution, the state will deduct from or reduce the monthly

compensation of the employee and deduct from the retirement

benefits of the annuitant an amount sufficient to pay the cost of the

basic coverage. All other UGIP participants will be billed directly by

ERS.

State Contributions to Group Insurance

Maximum Monthly

Level of Coverage State Contribution

Fiscal Year 2002

Employee Only $276.02

Employee and Spouse $433.45

Employee and Children $381.43

Employee and Family $538.86

At the time of publication, figures for FY 2003 were not available. 

Workers' Compensation

The Employer Liability Act of 1913 established the Texas Workers'

Compensation System. The intent of the law was to provide quick

and certain relief to injured workers. The program provides both

medical and indemnity payments to eligible state employees.

The State of Texas is self-insured, and the State Office of Risk

Management (SORM) administers the State's workers' compensation

system for most state employees. SORM is the insurance carrier for

all state agencies except the Texas Department of Transportation,

The University of Texas System, and the Texas A&M University

System. The director of SORM represents the State in workers'

compensation matters, may make procedural rules, and may

prescribe forms necessary for the effective administration of the

program.

Employees covered by workers' compensation insurance coverage or

their legal beneficiaries have the exclusive remedy of recovering

Workers' Compensation benefits against the employer, their agents,

or an employee of the employer. To receive Workers' Compensation

payments, a state employee must suffer a compensable injury in the

course of employment. In Section 401.011 of the Texas Labor Code,

an injury is defined as "damage or harm to the physical structure of

the body and a disease or infection naturally resulting from the

damage or harm." An occupational disease is considered an injury.

Medical Benefits: An injured employee is entitled to "all health care

reasonably required by the nature of the injury as and when needed."

Such health care includes cures or relief from the effects of the

injury, aiding recovery, or enhancing the ability of the employee to

return or retain his or her employment.

The injured worker is entitled to his or her choice of treating doctor

who must be one of the doctors listed on the Texas Workers'

Compensation Commission's (TWCC) approved doctors list. The

injured worker may change his or her treating doctor but may require

prior approval of TWCC or the regional health care network, if

applicable. Employees may be required to submit to a medical

examination to resolve any questions about the appropriateness of

health care received by the injured worker, the impairment caused by

the compensable injury, the attainment of maximum medical

improvement (MMI), or similar issues. The TWCC chooses a doctor

from a pre-approved list. At the request of their insurance carriers,

injured employees may have a doctor of their choice present at an

examination that is ordered by the TWCC. The insurance carrier is

required to pay the fee for the doctor chosen by the employee.

Income Benefits: In addition to medical services payments, state

employees are eligible to receive income benefits for time lost from

employment for an injury that results in disability for at least one

week. If the disability continues for longer than one week, income

benefits begin to accrue on the eighth day after the disability begins.

An employee's entitlement to income benefits ends with the death of

the employee and eligibility for temporary income, impairment

income, and supplemental income benefits terminates on the

expiration of 401 weeks after the date of injury.

An employee may elect to use accrued sick leave before receiving

income benefits. If an employee elects to use sick leave, the

employee is not entitled to income benefits until the employee has

exhausted the employee's accrued sick leave. An employee may also

elect to use all or any number of weeks of accrued annual leave after

the employee's accrued sick leave is exhausted. If an employee elects

to use annual leave, the employee is not entitled to income benefits

until the elected number of weeks of leave have been exhausted. The

employee may elect not to use sick leave or vacation leave. Once the

election has been made, the employee cannot change his or her

election.

Employees who are receiving temporary disability payments or

workers' compensation benefits may use their paid vacation leave.

State agencies may not require employees to exhaust their

compensatory leave before receiving weekly income benefits under

the workers' compensation law. Nor may state agencies prohibit their

employees from using compensatory leave during the time they are

receiving weekly income benefits under the workers' compensation

law.

Employees of the Texas Department of Transportation may elect to

use accrued sick leave before receiving income benefits. If an

employee elects to use sick leave, the employee is not entitled to

income benefits until the employee has exhausted the employee's

accrued sick leave. An employee may elect to use all or any number

of weeks of accrued annual leave after the employee's accrued sick

leave is exhausted. If an employee elects to use annual leave, the

employee is not entitled to income benefits until the elected number

of weeks of leave have been exhausted. 

There are four categories of income benefits: temporary, impairment,

supplemental, and lifetime. A brief description of each follows.

Temporary benefits continue until a worker has reached maximum

medical improvement (MMI). MMI is reached when certified by a

doctor or after 104 weeks after temporary benefits begin to accrue,

whichever occurs first. These benefits are paid at 70 percent of the

difference between the worker's average pre-injury weekly wage and

the worker's post-injury weekly earnings, not to exceed 100 percent

of the state average weekly wage rounded to the nearest whole

dollar. For workers who earn less than $8.50 an hour, benefits for the

first 26 weeks are paid at 75 percent of the difference between the

worker's average pre-injury wage and the workers post-injury

earnings.

Impairment benefits begin the day after a worker has reached his or

her MMI point and end either on the date of expiration computed at a

rate of three weeks for each percentage point of impairment, or on

the date of the employee's death, whichever comes first. A worker

who remains impaired by an injury after he or she has reached MMI

will be eligible for impairment benefits. If the diagnosis is disputed

and the parties cannot agree on a doctor to determine whether a

worker has reached MMI, the TWCC will assign a doctor.

The certifying doctor assigns a rating to the worker's impairment

using the American Medical Association's Guides to the Evaluation

of Permanent Impairment. The rating determines the number of

weeks that impairment benefits will be paid. If the impairment rating

is disputed, a doctor chosen by the agreement of both parties or, if

the parties cannot agree, a doctor appointed by the TWCC will assign

a rating. Impairment income benefits are paid at 70 percent of the

worker's average pre-injury weekly wage, not to exceed 70 percent

of the state average weekly wage rounded to the nearest whole

dollar.

Supplemental benefits are paid when a worker's impairment

benefits expire if the worker has an impairment rating of 15 percent

or more; has not returned to work at all or returns to work earning

less than 80 percent of his or her average pre-injury weekly wage;

has not decided to commute part of his or her impairment income

benefit; and has made a good-faith effort to seek employment

according to his or her ability to work. Eligible employees may be

paid supplemental benefits not to exceed 70 percent of the state

weekly wage rounded to the nearest whole dollar. Benefits for a

week are equal to 80 percent of the amount calculated by subtracting

a worker's weekly wage earned during the reporting period from 80

percent of the worker's average weekly wage.

Lifetime benefits are paid for specific serious injuries until the death

of the employee. Employees may be paid at 75 percent of the

worker's average pre-injury weekly wage, not to exceed 100 percent

of the state average weekly wage rounded to the nearest whole

dollar, for the following injuries:

Total and permanent loss of sight in both eyes

Loss of both feet at or above the ankle

Loss of both hands at or above the wrist

Loss of one foot at or above the ankle and the loss of one hand at

or above the wrist

An injury to the spine that results in permanent and complete

paralysis of both arms, both legs, or one arm and one leg

An injury to the skull resulting in incurable insanity or imbecility

Third degree burns over at least 40 percent of the body

Third degree burns covering the majority of either both hands or

one hand and the face.

Death and Burial Benefits: Death and burial benefits are paid to the

beneficiaries of a deceased employee if the employee dies from a

compensable injury. The beneficiaries of the employee are entitled to

75 percent of the employee's average weekly salary not to exceed

100 percent of the state average weekly wage rounded to the nearest

whole dollar. Beneficiaries may include eligible spouses, children,

grandchildren, or dependents.

Weekly payments to an employee's eligible spouse continue until the

spouse dies or remarries. If the spouse remarries, he or she may

receive 104 weeks of death benefits, commuted according to TWCC

rules. Weekly payments to an employee's dependent child continue

until the child reaches age 18. If the child is enrolled as a full-time

student at an accredited educational institution, then weekly

payments may continue until the child reaches age 25, until the date

the child is no longer enrolled as a full-time student for the second

semester in a row, or until the child dies, whichever is first. A child

who is an employee's dependent at the time the employee dies is

entitled to receive benefits until the date the child dies, the date the

child no longer has a disability, or, if the child does not have a

disability, after 364 weeks of death benefit payments, whichever is

first. All other beneficiaries are entitled to 364 weeks of payments or

payments until the date they die. Burial benefits include the actual

costs incurred for reasonable burial expenses or $6,000.

Notification and Claim Requirements: An employee, or a person

acting on his or her behalf, must notify the employer of an injury

within 30 days after the incident occurred or after the employee knew

or should have known that the injury may be related to his or her

employment. Failure to file notice relieves the employer and its

insurance carrier of liability unless the employer has actual

knowledge of the injury; the TWCC determines that good cause

exists for failure to provide notice; or the employer or their insurance

carrier does not contest the claim.

Claims for compensation must be filed with the TWCC within one

year of when the injury occurred or, if the injury is an occupational

disease, when the employee knew or should have known the disease

was work-related. Failure to file a claim for compensation with the

TWCC relieves the employer and its insurance carrier of liability

unless good cause exists for failure to file a claim or the employer or

its insurance carrier does not contest the claim.

Claims for death benefits must be filed with the TWCC within one

year of the employee's death. Failure to file bars the claim unless the

person is a minor or incompetent or good cause exists for the failure

to file a claim. "A separate claim must be filed for each legal

beneficiary unless the claim expressly includes or is made on behalf

of another person."

Out-of-State Assignments or Positions: Workers' compensation

coverage extends to state employees regularly assigned to positions

outside the State of Texas. The Texas Labor Code provision states:

An employee who performs services

outside the state is entitled to benefits

under this [workers' compensation] chapter

even if the person is hired or not hired in

this state; does not work in this state; works

both in this state and out of state; is injured

outside this state, or has been outside this

state for more than one year. An employee

who elects to pursue remedies provided by

the state where the injury occurred is not

entitled to benefits.

Emergency Leave and Workers' Compensation: In accordance

with the current General Appropriations Act, the administrative

head(s) of an agency, department, or institution may authorize

emergency leave with pay to an employee receiving workers'

compensation benefits. The emergency leave payments may not

exceed an amount equal to the difference between the basic monthly

wage of the employee and the amount of income benefits the

employee received for the month. The emergency leave payments

may not extend for more than six months from the date when

payment began.

Leave Accumulation and Workers' Compensation: The State

Auditor's Office has ruled that state employees who are exhausting

their leave as a result of a workers' compensation claim are

prohibited from using sick and annual leave hours that accrue after

the first day of the month in which the employee becomes

incapacitated unless the employee physically returns to work.

Reporting Requirements: At the close of each calendar quarter, the

State Office of Risk Management shall prepare a statement reflecting

the amount of workers' compensation benefits paid to, or on behalf

of, former and current state employees and present it to the

Comptroller.

DEFERRED COMPENSATION

Texas state agencies are permitted to offer a deferred compensation

program in addition to an established retirement, pension, or benefit

system. Employees who participate in a deferred compensation plan

may voluntarily defer part of their compensation for investment in a

qualified investment product. The plan administrator must approve

an investment product before it can be classified as qualified.

Deferred compensation plans must provide that employees do not

have to pay federal income tax on deferred amounts and investment

income until those amounts are distributed to the employee.

There are two major types of deferred compensation plans described

in the Texas Government Code. A 401(k) Plan is governed by

Section 401(k) of the Internal Revenue Code of 1986. Likewise, the

457 Plan is governed by Section 457 of the Internal Revenue Code of

1986. The Board of Trustees of the Employees Retirement System of

Texas (ERS) is the plan administrator for both the 401(k) Plan and an

established 457 Plan. These plans are referred to collectively as

Texa$aver.

Under a 401(k) Plan, the State may contract with any employee to

defer any portion, up to 25 percent or $10,500* , whichever is less, of

the employee's eligible compensation. Under the 401(k) Plan,

contributions are made on a tax-deferred basis. Some differences

found in the 401(k) Plan include the option to borrow against

deferred compensation funds and to roll over these funds into an

Individual Retirement Account. Also, purchasing a primary residence

and some educational costs are included in the definition for

financial hardship withdrawals under the 401(k) Plan, unlike the 457

Plan.

The 457 Plan allows employees to invest with a variety of vendors.

The State may contract with any employee to defer any portion, up to

25 percent or $8,500, whichever is less, of the employee's eligible

compensation.

RETIREMENT

There are several retirement systems that include state employees.

The brief description that follows is limited to the Employees

Retirement System (ERS) because it includes the largest number of

state employees.

Membership

As a condition of employment, all employees and appointed officers

of every department, commission, board, agency, or institution of the

State become members of the employee class of ERS and begin to

earn monthly service credits on the first day of employment. Persons

whose employment is covered by the Teacher Retirement System or

the Judicial Retirement System (Plan I or II), or who are independent

contractors or employees of such contractors, are not eligible for

participation. Elected officials that are not part of the Teacher

Retirement System or the Judicial Retirement System (Plan I or II)

may participate in ERS if they desire, but they will be members of

the elected class rather than the employee class of the system.

Temporary employees age 65 years or older, who are not current

members of ERS, may elect not to join the system for the first six

months of employment. However, membership is mandatory when

the employment continues into the seventh month.

Contributions

Employee Contributions: The Texas Constitution requires that

those employees participating in the ERS contribute at least 6 percent

of their current compensation into the system. Currently, employees

who are members of ERS, but who are not members of the

Legislature, contribute 6 percent of their compensation to the

retirement fund. Employees who are members of the Legislature

must contribute 8 percent of their compensation to ERS. The agency

where the ERS-covered employee works will deduct, in each payroll

period, the amount of contribution the employee owes The deduction

process requires no employee consent, as the employee consents to

the automatic deduction when he or she becomes a member of ERS.

Each employee who is a member of ERS is required to pay an annual

membership fee of $2. However, the fee may be waived if the

Legislature appropriates funds sufficient to pay the membership fees.

In 2001, the 77th Legislature continued the long-standing tradition

(begun in 1973) of appropriating funds to pay the membership fee.

State Contributions: The amount contributed by the State may not

be less than 6 percent or more than 10 percent of the aggregate

compensation paid to individuals participating in ERS. According to

the General Appropriations Act, Article I, Section 1, Employees

Retirement System (4), the State currently contributes an amount

equal to 6 percent of the total compensation of all members of the

retirement system for that year. In an emergency, as determined by

the Governor, the Constitution allows the Legislature to appropriate

such additional funds as are actuarially determined to be required to

fund benefits authorized by law.

Withdrawal of Contributions: For employee class members of

ERS, a member may receive a refund of his or her contributions to

the retirement fund if the member is not currently employed in a

position in the employee class, does not assume or resume a position

in the employee class during the 30 days after the day on which the

member terminates employment, and files an application for

withdrawal.

Withdrawal of contributions cancels a person's membership in the

retirement system, the person's service credit, and all rights to

benefits from each class from which a withdrawal is made.

The amount a member withdraws is based on his or her accumulated

monthly contributions, any contributions made to establish or

reestablish service credit, and interest on the accumulated amount.

Interest is earned monthly at the rate of 5 percent a year on the mean

balance of the member's account for the fiscal year. The refunded

amount does not include any membership fees or interest the person

may have paid to establish or reestablish service credit.

Purchase of Service Credit

Types of Service Credit That May Be Purchased: In addition to

the service credit earned for each month as a contributing member of

ERS, there are three types of service credit that may be purchased by

eligible employee class members.

Service credits previously canceled by a member withdrawing the

member's accumulated contributions from the system (also known as

refunded service credit) may be purchased by depositing with ERS

the amount withdrawn, plus interest computed on the basis of the

state fiscal year at an annual rate of 5 percent from the date of

withdrawal to the date of deposit.

A person may reestablish service credit previously canceled in the

retirement system if the person is a member of the employee class

and at least six months have elapsed since the end of the month in

which the cancellation became effective; or the person is a former

member of the employee class and a participant in the optional

retirement program.

One month's service credit may be purchased for each month or

fraction of a month of military service, defined as active federal duty

as a member of the U.S. Armed Forces, up to a maximum of 60

months. To be eligible to purchase military service credit, a person

must not be eligible for a federal retirement benefit based on 20 years

or more of active federal military duty or its equivalent and must

have received a discharge that was not dishonorable. Military service

credit may be purchased anytime after a person becomes a member.

Military service may be purchased by depositing with ERS an

amount composed of contributions plus 10 percent interest for each

fiscal year from the date first eligible to purchase the service. No

penalty interest is charged if military service is purchased during the

first year of eligibility following active military duty. Military

service is used in computing occupational disability benefits and in

determining eligibility for the selection of a death benefit plan.

Military service credit may be used in computing service retirement

and non-occupational disability after a member has at least five years

of non-military service credit.

Employees may also purchase service credit not previously

established. This includes service during times when a waiting period

for system membership was in effect (September 13, 1947, to August

31, 1973) and other service for which no contribution was made.

This service may be purchased by depositing with the ERS an

amount comprised of contributions plus 10 percent interest for each

fiscal year from the date of first eligibility to purchase the service.

Eligible members may establish not more than 60 months of

equivalent membership service credit, including law enforcement or

custodial officer service, in either the elected class or the employee

class. A member is eligible to establish this service credit if the

member has at least 120 months of actual membership service of the

type of service that the member seeks to establish. A member may

establish this service credit by depositing with the retirement system,

for each month of service credit, the actuarial present value, at the

time of deposit, of the additional standard retirement annuity benefits

that would be attributable to the purchase of this service credit, based

on rates and tables recommended by the retirement system's actuary

and adopted by the board of trustees. After a member makes these

deposits, the retirement system shall grant the member one month of

equivalent membership service credit for each month of credit

approved.

Methods for Purchasing Service Credit: Members may purchase

service credit for which they are eligible by making a lump-sum

payment to the ERS for the entire period of service, or through

alternative methods. A minimum of one month service credit may be

purchased through a lump-sum payment.

Eligible members may also purchase service credit through monthly

payroll deductions. Payroll deductions to purchase service credit are

subject to the rules of the ERS.

Annual Leave Counted as Service Credit

At the employee's option, he or she may count their annual leave that

has accumulated and is unused on the last day of employment as

service credit when they retire, in addition to receiving it as a lump-

sum payment. Annual leave is creditable in the retirement system at

the rate of one month of service credit for each 20 days, or 160

hours, or fraction thereof of accumulated annual leave.

Sick Leave Retirement Credit

A member who retires based on service or a disability is entitled to

service credit in ERS for the member's sick leave that has

accumulated and is unused on the last day of employment. An

employee is entitled to credit for accrued sick leave only when

employed during the month that includes the effective date of the

member's retirement. Sick leave is creditable in ERS at the rate of

one month of service credit for each 20 days, or 160 hours, or

fraction thereof, of accumulated unused sick leave. A member may

use accumulated sick leave to satisfy service requirements for

retirement as well as to increase the value of his or her annuity.

Retiring employees may donate all or part of their sick leave balance

to the agency's sick leave pool before the agency certifies any

remaining hours to be used for service credit. The statutes contain no

provision that allow a retiring employee to store or bank accumulated

sick leave for use after retirement if they return to work with the

State.

Retirement Eligibility

An ERS member in the employee class who has service credit in the

system, whether or not employed at the time of his or her birthday, is

eligible to retire and receive a service retirement annuity if:

The member is at least 60 years old and has five years of service

credit in the employee class (the employee must have ten years

service credit to be eligible for group health insurance); or

The sum of the member's age and amount of service credit in the

employee class, including months of age and credit, equals 80

and the member has at least five years of service credit in the

employee class.

For the sole purpose of determining eligibility to receive a

service retirement annuity, ERS shall consider service

performed as a participant in the optional retirement program

under Texas Government Code Chapter 830 as if it were

service for which credit is established in ERS.

For the sole purpose of determining eligibility to receive a

service retirement annuity, ERS shall consider not more than

60 months, or portions of months, of service performed for a

Texas governmental employer by a member who has at least

five years of service credit, excluding military service, in the

employee class as if it were service for which credit is

established in ERS.

The eligibility requirements of the elected class of the ERS are

different. In the case of elected members, these individuals are

eligible to retire and receive a service retirement annuity if the

member:

Is at least 60 years old and has eight years of service credit in

that class; or

Is at least 50 years old and has 12 years of service credit in that

class.

A member is eligible to retire and receive a service retirement

annuity if he or she is at least 55 years old and has at least ten years

of CPO/CUS service credit as one of the following:

A commissioned peace officer engaged in criminal law

enforcement activities of the Department of Public Safety, the

Texas Alcoholic Beverage Commission, the State Board of

Pharmacy, or the Parks and Wildlife Department

An employee of the Railroad Commission of Texas who is

licensed by the Commission on Law Enforcement Officer

Standards and Education and who has served at least five years

as an investigator for the oil field theft detection division

A parole officer or caseworker for the Board of Pardons and

Paroles or Texas Department of Criminal Justice

As a custodial officer

An ERS member who has at least 20 years of service credit as a law

enforcement or custodial officer is eligible to retire, regardless of

age, and receive a standard service retirement. However, a law

enforcement or custodial officer who retires before attaining the age

of 50 receives an actuarial reduction from the annuity that would

have been available at age 50. The rule of 80 also applies to members

with CPO/CUS service credit.

A member of both the Employees Retirement System and the

Teacher Retirement System who applies for service or disability

retirement from either system may transfer to that system service

credit established in the other system if the member has at least three

years of service credit in the system from which the member is

retiring. A member of both systems with less than three years of

service credit in the current system and at least three years in the

other system may, at the time the person applies for service or

disability retirement from the other system, transfer service credit to

that system from the system in which the person most recently

received service credit.

Disability Retirement

A retirement system member who has service credit in either

membership class is eligible to retire under an occupational

disability, regardless of age or amount of service credit.

A system member who is also a member of the Texas National

Guard or Texas State Guard is eligible for retirement for an

occupational disability if the person is injured while on active duty

with the national or state guard, is discharged from that entity

because of the injury, and ceases state employment.

In the case of a non-occupational disability, a member is eligible to

retire if that person has at least one of the following:

Eight years of membership service credit in the elected class of

membership

Six years of membership service credit in the elected class plus

two years of military service credit established before January

1, 1978

Ten years of membership service credit in the employee class of

membership

Except for certain peace officers and custodial officers, a standard

disability retirement annuity for service credited in the employee

class of membership is an amount computed at the rate of 2.3 percent

for each year of service credit in that class times the member's

average monthly compensation.

In the case of either an occupational or a non-occupational disability,

the standard disability retirement annuity may not be less than 35

percent of the average monthly compensation, or $150 per month,

whichever is greater. For both types of disabilities, the annuity may

not exceed 100 percent of the applicable rate of compensation.

Disability benefits for certified peace officers and custodial officers

are based on a benefit multiplier of 0.5 percent higher than the

regular service retirement package. The annuity may not be less than

50 percent of the average monthly compensation. If a certified peace

officer or eligible corrections officer is occupationally disabled so

that the person is considered totally disabled under the federal social

security laws, ERS shall increase the person's occupational disability

retirement annuity to 100 percent of the person's monthly

compensation at the time the disabling event occurred.

Retirement Benefits

The standard service retirement annuity for service credited in the

employee class of membership (in ERS) is an amount computed as

the member's average monthly compensation for service in that class

for the 36 highest months of compensation multiplied by 2.3 percent

for each year of service in that class.

The standard service retirement annuity for service credited in the

employee class may not be less than $150 a month or more than 100

percent of the average monthly compensation computed as described

above.

ERS members who have at least 20 years of service credit as law

enforcement or custodial officers receive benefit rates that are based

on the employees' average salary for the 36 highest months of

compensation, multiplied by the sum of the percentage factor for

standard service retirement plus 0.5 percent for each year of service

in a qualified position.

For a member of the elected class of ERS, the standard service

retirement annuity is an amount equal to 2 percent for each year of

service credit in that class, multiplied by the current state salary

being paid a district judge. In addition, the provision states that the

annuity may not exceed, at any time, 100 percent of the current state

salary being paid a district judge.

A retiree may irrevocably waive all or a portion of any benefit from

the retirement system to which he or she is entitled; this is in order to

allow retirees the ability to receive other services such as Medicaid.

ERS can pay an alternate payee (spouse) of a current retirement

system member who meets certain conditions a monthly annuity

from the member's retirement account. The payee must choose to

receive the payment in lieu of the payee's interest in that account

awarded by a qualified domestic relations order. The member must

be an active employee who is eligible to retire, but who has not yet

retired. Upon retirement, the member's retirement benefit is reduced

by the amount awarded to the alternate payee.

Proportionate Service Retirement Program Benefits

The purpose of this program is to provide proportionate benefits to

qualified members who have service credit in more than one

retirement system (employees have service credit only if they have

not received a refund of their contributions). It is contrary to the

purpose of the program for a person or class of persons to receive,

because of service in more than one retirement system,

proportionately greater benefits from a particular system than a

person only under one system. The statewide retirement systems

required to participate in the program are the Employees Retirement

System of Texas, the Teacher Retirement System of Texas, and the

Judicial Retirement System of Texas Plan I and II. A subdivision

participating in the Texas County and District Retirement System, a

municipality participating in the Texas Municipal Retirement

System, or municipal employees participating in a retirement system

for general municipal employees in a municipality with a population

between 460,000 and 500,000 can elect to join the proportionate

retirement program.

The law allows an eligible employee to accrue "split service"

retirement benefits in more than one of the retirement systems. A

person who has membership in two or more statewide retirement

systems is subject to the laws governing each of those systems for

determining the person's eligibility for service retirement benefits

from each system. However, for the purpose of determining whether

a person meets the length-of-service requirements for service

retirement in a system, the person's combined service credit must be

considered as if it were all credited in each system. Each retirement

system will pay benefits based only upon the service and salaries

established in that system. A retired employee receives an annuity

from each of the systems where he or she has retired. A person's

combined credit service is usable only in determining eligibility for

service retirement benefits and may not be used in determining the

eligibility for disability retirement benefits, death benefits, or any

type of benefit other than service retirement benefits.

The proportionate retirement program allows employees with service

in two or more participating systems to obtain retirement benefits

while preserving the integrity of each retirement fund. The following

example illustrates how the proportionate service benefit works: A

person served as an employee of an eligible municipality for three

years, and, on leaving employment, chose not to receive a refund of

retirement contributions, thereby retaining service credit in the

municipality's retirement plan. The person then worked for the State

for three years. On attainment of retirement age, without the

proportionate service retirement benefits program, the person would

not have had the five years of service credit needed to retire from

either system. However, the proportionate retirement program allows

the person to combine service under two retirement systems for a

total of six years' service, three under each system. Benefits are paid

proportionately from each system.

A person who is a member of a retirement system participating in the

proportionate program may reestablish service credit, including

service credit if applicable, previously canceled in another system

that is participating in the proportionate program if the person:

1. Is not a current member of the system under which service was

performed

2. In the case of the Texas County and District System, does not

have an open account for which the person performed the

service for which credit is sought.

If membership in the Employees Retirement System or the Teacher

Retirement System was terminated after August 31, 1993, it may be

reinstated and other service purchased only by a member of the

system in which the service is creditable who meets the general

requirements for reinstatement or purchase of service credit in that

system.

Service credit may not be reestablished in a subdivision participating

in the Texas County District Retirement System or a municipality

participating in Texas Municipal Retirement System if the person

who seeks to the credit is a member only of a retirement system that

subdivision or municipality excludes from participation in the

retirement program under Texas Government Code Section 803.103.

Resumption of State Service by a Retiree

The retirement system will no longer suspend annuity payments to

retirees who resume state service in the employee class if the retiree

holds a position included in that class for more than nine months in

any one fiscal year.

In the case of an individual who is a member of the elected class of

ERS, the retirement system will suspend annuity payments when the

person takes the oath for a position included in the elected class and

will continue to withhold annuity payments until that person no

longer holds the elected position.

Before the retiree begins work in a position included in the employee

class of membership, the retiree and the employing agency must

notify the retirement system in writing of the retiree's name, his or

her date of employment, and the projected dates of service. Similarly,

a retiree from the elected class of membership must notify the

retirement system of resumption of state office and the projected

dates of service before the retiree takes the oath of office.

If an employee takes a position in a class of membership other than

that from which the person retired or the retiree is serving the State

as an independent contractor, that person may continue to receive

retirement benefits.

With the exception of a person who is retired from the elected class

of ERS and who again holds a position in that class, a retiree may not

rejoin ERS as a member of the class from which the person retired. A

retiree taking a state position not included in the membership class

from which the retiree receives retirement benefit payments:

Is required to become or remain a member if the position is

included in the employee class

May elect to become or remain a member if the position is

included in the elected class

Optional Service Retirement Benefits

Retiring members of the Employees Retirement System may elect to

receive an optional retirement annuity in the place of the standard

retirement annuity. The member may select any optional retirement

annuity approved by the board of trustees or may select one of the

following payment options:

After the retiree's death, a reduced annuity is payable in the same

amount throughout the life of the person designated by the

retiree at retirement.

After the retiree's death, three-fourths of the reduced annuity is

payable throughout the life of the person designated by the

retiree before retirement.

After the retiree's death, one-half of the reduced annuity is

payable throughout the life of the person designated by the

retiree before retirement.

If the retiree dies before 60 monthly annuity payments have been

made, the remainder of the 60 payments are payable to one or

more designees or, if one does not exist, to the retiree's estate.

If the retiree dies before 120 monthly payments have been made,

the remainder of the 120 payments are payable to one or more

designees or, if one does not exist, to the retiree's estate.

At the time of retirement, the retiree may choose to take a partial

lump sum of up to 36 months of his or her standard annuity.

The employee's monthly annuity would then be recalculated

using an actuarial reduction factor. This lump-sum option is

effective January 1, 2000. Members retiring under the

proportionate retirement program provided by Texas

Government Code Chapter 803 are not eligible for this lump-

sum option.

A member who selects an optional retirement annuity must designate

a person to receive the annuity on the death of the member before the

selection becomes effective. If the designated person predeceases the

retiree, the reduced annuity will be increased to the standard service

retirement annuity. The standard service retirement annuity will be

adjusted for early retirement and post-retirement benefit increases

authorized by law. The increase in the annuity begins the month after

the designee dies and is payable to the retiree for the remainder of the

retiree's life.

A retiree may change from an optional annuity selection to a

standard retirement annuity by filing a request with the retirement

system if the designated beneficiary was not at the time of

designation and is not currently the retiree's spouse or child, or has

executed since the designation a transfer and release, approved by a

court of competent jurisdiction in a divorce decree, of the

beneficiary's interest in the annuity and is not currently the retiree's

spouse or child. If such a change is made, the retirement system will

recompute the annuity as a standard service retirement annuity, and

payment will be adjusted for the first monthly payment following the

filing of the request to change.

Death Benefits

A member who has at least 10 years of service credit in the

elected or employee class of membership may select a death

benefit plan for the payment, if the member dies while the

member is eligible to select a plan, of a death benefit annuity to a

person designated by the member. A death benefit designee of an

ERS member who dies is entitled to service credit in the retirement

system for the member's sick leave that has accumulated and is

unused on the member's date of death. Annual leave may be applied

in a similar manner. For making a death benefit selection, a

designation of a former spouse as beneficiary is invalid unless the

designation is made after the date of the divorce.

If a member who is eligible to choose a death benefit plan dies

without having made a selection, or if a selection cannot be made

effective, the member's designated beneficiary or the personal

representative of the member's estate, (provided there is no

designated beneficiary), may select an annuity plan. In lieu of

selecting a death benefit plan, the beneficiary or the member's

representative may elect to receive a refund of contributions. A death

benefit designee may use the deceased member's sick leave credit to

qualify for making a death benefit plan selection. A death benefit

designee may use the deceased member's annual leave credit to

qualify for making a death benefit plan selection.

If a contributing member dies who, at the time of death, was eligible

for retirement by age and length of service, but was not eligible to

select a death benefit, an annuity is payable only to a designated

beneficiary or to a guardian of minor children (when there is no

designated beneficiary). In the event there is no surviving spouse or

minor children, the estate may only receive a refund of the

accumulated contributions. The spouse or guardian, as the case may

be, may select a refund of the accumulated contributions in lieu of a

benefit payment.

In the event a member is not eligible for retirement or eligible to

select a death benefit plan, the accumulated employee contributions

(plus accrued interest) are refunded to the member's designated

beneficiary or the member's estate (provided the member does not

designate a beneficiary or the beneficiary does not survive the

member). If a contributing member dies who, at the time of death,

was not eligible to select a death benefit and who was:

actively employed by the State;

receiving Workers' Compensation benefits for an injury

sustained while employed by the state; or

on authorized sick leave,

then a lump-sum death benefit is payable to the employee's

designated beneficiary or to the member's estate. The lump-sum

death benefit, which is a sum provided in addition to the refunded,

accumulated employee contribution, is an amount computed at the

rate of 5 percent of the amount in the member's individual account at

the time of death times the number of full years of service credit the

member had at the time of death. However, the lump-sum death

benefit may not exceed 100 percent of the amount in the member's

individual account. The lump-sum death benefit may not be paid to a

member who, at the time of death, had a death benefit annuity that

became effective.

In the event of an occupational death, an amount equal to one year's

salary is paid to the surviving spouse or the guardian of dependent

minor children in addition to the death benefits provided above. A

1978 Attorney General Opinion held that "payments made by the

Retirement System for the benefit of a minor child may be made to

the parent under Section 12.04 (4) and (8) of the Family Code."

Supplemental death benefits are payable upon the death of an

employee with 20 or more years of service as a state commissioned

peace officer or custodial officer.

ERS retirees who selected an optional retirement annuity plan may

now change the beneficiary designated at the time of retirement after

annuity payments have begun. If the beneficiary designated at the

time of retirement is the spouse or former spouse of the retiree, the

spouse or former spouse must give written, notarized consent to the

change, or a court with jurisdiction over the marriage must have

ordered the change.

The beneficiary is entitled on the retiree's death to receive

monthly payments of the survivor's portion of the retiree's

optional retirement annuity for the shorter of the remainder of

the life expectancy of the beneficiary designated as of the

effective date of the retiree's retirement; or the remainder of

the new beneficiary's life.

A retiree may not change a beneficiary after retirement if the

retiree has previously changed after retirement a beneficiary

for optional retirement annuity payments.

OTHER BENEFITS

Awards and Gifts

State agencies are authorized to purchase and present to their

employees or officers service awards, safety awards, and other

similar awards for professional achievement or other outstanding

service. The awards must be purchased at a cost not to exceed $50

per employee.

Awards and gifts may also be purchased for volunteers. The award

must be given in recognition of a volunteer's special achievement and

outstanding service and only if the agency has established a

volunteer program that complies with Chapter 2109 of the Texas

Government Code. The awards for volunteers, like those for

employees, cannot exceed $50 and are limited to engraved

certificates, plaques, pins, and other similar awards.

The Attorney General ruled that savings bonds with a maturity value

of more than $50 may be given as a gift by a state agency as long as

the purchase price is $50 or less.

Child Care Services

In an attempt to encourage state agencies to attend to their

employees' family needs, the 70th Legislature passed legislation in

1987 that empowered the Building and Procurement Commission to

allocate leasable state office building space for the provision of child

care by private vendors at the direction of the Child Care

Development Commission.

The Child Care Development Commission (Commission),

established in 1989, is responsible for developing and administering

a program to provide child care services for state employees, and, by

rule, the Commission may establish the methods with which to

administer and supervise such a program. The Commission or the

Commission's designee submits a report to the Legislature at each

legislative session that summarizes the development and progress of

the child care services program and describes additional child care

services needed by state employees.

The Child Care Advisory Committee, which is a body appointed by

the Commission, shall advise the Commission on the location, size,

and design of the child care facilities and the curriculum a child care

facility must provide to ensure the provision of high quality

developmentally appropriate services. The Child Care Development

Commission will provide the Building and Procurement Commission

with specifications for each child care facility site that include the

location, size, and design of the facility. With this information and

the continuing direction of the Commission, the Commission shall

make any contract necessary to establish a child care facility

consistent with the State Purchasing and General Services Act, Texas

Government Code, Section 2151.001 et seq.

Uniform Cleaning Allowance

A cleaning allowance is an allotment to help defray the cost of

maintaining a uniform for certain state employees. A cleaning

allowance is authorized for specific positions and does not transfer

with an employee if that employee transfers to a position for which

such reimbursement is not authorized. Cleaning and clothing

allowances shall not be considered compensation for purposes of

retirement contribution determination.

Clothing Allowance

Clothing allowances are authorized for certain commissioned officers

assigned to the Alcoholic Beverage Commission and the Department

of Public Safety and certain uniformed personnel in the Texas Parks

and Wildlife Department.

Employee Health Fitness and Education

The State Employees Health Fitness and Education Act of 1983 was

enacted to encourage and create a condition of health fitness in state

administrators and employees. Any agency or department may use

available public funds and facilities for health fitness education and

activities and other related costs. Each agency must first submit a

plan covering the participants, purpose, nature, duration, costs, and

expected results of such a program. The Act was amended in 1989 to

require that all health fitness plans be approved in writing by the

Texas Department of Health before implementation. If

implementation of a plan requires the expenditure of public funds,

written approval must also be obtained from the Governor or the

designated representative of the Governor.

Employee Meal Authorization

State agencies providing institution-based services, including the

Texas Department of Criminal Justice, the Texas Department of

Mental Health and Mental Retardation, the Texas Youth

Commission, the Texas School for the Blind and Visually Impaired,

and the Texas School for the Deaf, may provide meals to employees

working in institutional settings and may charge a fee at costs

established by the agencies that does not exceed the direct and

indirect costs of preparation.

Employee Assistance Programs (EAP)

An Employee Assistance Program (EAP) offers assistance in the

identification and resolution of productivity problems associated

with employees impaired by personal concerns including, but not

limited to, health, marital, family, financial, alcohol, drug, legal,

emotional, and stress which may adversely affect employee job

performance. The Texas State Human Resources Association

(TSHRA) has developed a guide for implementing an EAP in state

agencies. State agencies may elect to establish or participate in an

EAP for their employees. Agencies must meet the same requirements

as specified in the Employee Health Fitness and Education section,

above.

Tuition Assistance

Eligible members of the State's military forces, (Texas Army

National Guard, Texas Air National Guard, or Texas State Guard)

are authorized tuition assistance for any undergraduate or graduate

course at an institution of higher education or private or independent

institution of higher education, including a vocational or technical

course. In an effort to encourage voluntary membership, to improve

the education level of its members, to diversify the composition of

the forces, and to enhance the State's workforce, the Adjutant

General may award tuition assistance as necessary to meet the

recruitment and retention needs of the State's military forces. A

person may not receive tuition assistance under this section for (1)

more than 12 semester credit hours in any semester or (2) more than

five academic years or 10 semesters, whichever occurs first for the

person.

To be eligible for tuition assistance a person must be:

an enlisted member;

a warrant officer of a grade from Warrant Officer One through

Chief Warrant Officer Three;

or a commissioned officer of a grade from Second Lieutenant

through Captain; and,

meet any additional qualifications established by the Adjutant

General.

Work and Family Policy Clearinghouse

The Work and Family Policies Clearinghouse, a public/private sector

program housed at the Texas Workforce Commission, is mandated

by the Legislature to provide "technical assistance and information

on dependent care and other employment-related family issues to

public and private sector employees, state agencies, policy makers,

and individuals." The legislation provides for a private sector Work

and Family Policies Advisory Committee and earmarks money for

the activities of the Clearinghouse by creating a Work and Family

Fund to be administered by the Clearinghouse. The fund may be used

for the following:

The operation of the Clearinghouse (i.e., the provision of

information and technical assistance related to dependent care

and other employment-related family issues)

Research conducted or sponsored by the Clearinghouse on child

care and other employment-related family issues in the State