FCSO Had Deficiencies in Its Administration of Staff Overtime.

The audit found FCSO had five instances in which overtime forms could not be located, two instances of overtime forms lacking supervisor authorization, and one instance where an employee was paid less than what was owed.

Overview

We identified one instance in our sample of 82 overtime payments where an employee who earned 12 hours of premium overtime³ during a pay period was paid for 4 hours of premium overtime and 8 hours of straight overtime. In this sample of 82 payments, we also found one instance where FCSO could not locate an employee’s overtime authorization form, and therefore we could not review the form to determine whether authorized overtime was reconciled to amounts paid.

Additionally, in a sample of 94 overtime payments, there were five instances in which a form could not be located and two in which a completed form had not been authorized by a supervisor. In one of the instances where the form was missing, FCSO obtained email approval of the overtime from the supervisor instead of completing the required form. As a result of these issues, FCSO cannot demonstrate that all overtime pay was appropriate.

Authoritative Guidance

Under FCSO’s “Recording Employee Time and Attendance” directive, each staff member who works overtime submits a form documenting overtime worked to his/her direct supervisor for approval. The supervisor sends the form to the Human Resources Department, which is required to reconcile the form to employee attendance records to ensure that overtime is supported and reported correctly in the state payroll system that FCSO uses, Self-Service Time and Attendance (SSTA). The form requires the supervisor’s signature.

Section .10 of FCSO’s General Order 345, “Payment Procedures,” states,

The original (if available) or copy of fiscal documents shall be systematically filed and maintained to facilitate later retrieval for audit purposes.

General Order 345 documents policies for the expenditure of funds from appropriated accounts, which include payroll expenditures. Therefore, FCSO should retain overtime authorization forms.

Reasons for Issues

At the time the questioned payments were made, SSTA was set up to automatically calculate overtime based on hours worked. SSTA reduced premium overtime hours and converted the hours to straight overtime if an employee used sick time during the week. However, FCSO labor union agreements and policies do not contain language stating that premium hours will be reduced if sick time is used. This error was not identified by the FCSO Human Resources Department during the reconciliation process. FCSO officials told us that after we notified them, they immediately had settings in SSTA changed to agree with FCSO’s policies, and that this issue should not happen again in the future. FCSO also immediately corrected the error, and the premium overtime owed to the employee was included in the employee’s next paycheck.

FCSO officials told us that the overtime would not have been paid without overtime authorization forms and that some of the missing forms we requested were misplaced. In two instances of missing forms, the employees in question had subsequently retired, so FCSO could not obtain forms from them. In the instance where overtime was approved with an email instead of a form, FCSO told us that this was only done in limited circumstances, when the supervisor was unavailable because of retirement. Finally, during the audit, FCSO officials told us that processing overtime payments without supervisor approval was an oversight by the FCSO Human Resources Department.

Recommendations

1. FCSO should take the measures necessary to ensure that all overtime authorization forms are approved, completed, and retained for all instances of overtime earned by staff members.
2. FCSO should ensure that all overtime earned by staff members is reconciled to overtime authorization forms.

Auditee’s Response

We will continue to employ our own policy on approving overtime. We are quite diligent in getting signatures and we do not pay overtime without supervisory approval. More of the challenge may be in ensuring we take a different approach on where we file these forms so that they can always be available upon request. No employee makes a decision on their own overtime and we do not pay overtime without a supervisor’s approval so again, the opportunity here is in how/where we store these approval forms.

I’m confident [in] the processes we have in place, minimally, to prevent us from over-paying overtime, while we have systems in place to allow for prompt payment of approved overtime should it be determined that overtime was worked.

Auditor’s Reply

Based on its response, FCSO is taking measures to ensure that all overtime authorization forms are completed, retained, and reconciled. However, as noted above, we identified two instances where FCSO did not have documented approval of overtime authorization forms. Therefore, FCSO should also ensure that overtime authorization forms are approved for all overtime earned by staff members.

3.    Premium overtime is paid at one and a half times the employee’s standard hourly rate for work that exceeds the employee’s normal, scheduled full-time work week. In contrast, straight overtime is paid at the standard hourly rate for work that exceeds a worker’s scheduled hours, if the total hours worked do not exceed a full-time work week.

Date published:	September 26, 2019