To: Business Managers
HR Facilitators
From: Dennis Press, University Controller
Date: March 9, 2010
The purpose of this email is to provide advance notice regarding rate changes effective July 1, 2010.
The Composite Benefits and Severance Pay rates are assessed based on salaries paid from Non-State Funds and provide funding to reserves. The reserves are used to pay Non-State Funds expenses for unemployment compensation, workers compensation, short-term disability pay, health insurance premiums while on professional leave, and severance wages.
Based are reserve levels and expenditure trends, an adjustment in the two rates will be implemented for fiscal year 2010-11. The Composite Benefits rate will decrease from 0.5% to 0.4% of salaries, and the Severance Pay rate will increase from 0.4% to 0.6% of salaries. The rate changes are effective with the July 2010 payrolls. The Composite Benefits rate is applied to both EPA and SPA salaries, and the Severance Pay rate is applied to just SPA salaries. So the overall cost to departments should not increase with the rate changes.
The rates are summarized as follows:
Severance Pay
Object Code: 1251
Salary Base: SPA Salaries paid from Non-State Funds
Rate Change: Increase from 0.4% to 0.6%
Effective Date: 07/01/2010
Composite Benefits Fund
Object Code: 1892
Salary Base: EPA and SPA Salaries paid from Non-State Funds
Rate Change: Decrease from 0.5% to 0.4%
Effective Date: 07/01/2010
Thank you.