Report 2007-102.1 Recommendations and Responses in 2012-041

Report 2007-102.1: California State University: It Needs to Strengthen Its Oversight and Establish Stricter Policies for Compensating Current and Former Employees

Department Number of Years Reported As Not Fully Implemented Total Recommendations to Department Not Implemented After One Year Not Implemented as of Most Recent Response
California State University 4 6 6 3

Recommendation To: University, California State

The university should work through the regulatory process to develop stronger regulations governing paid leaves of absence for management personnel. The improved regulations should include specific eligibility criteria, time restrictions, and provisions designed to protect the university from financial loss if an employee fails to render service to the university following a leave. For example, the regulations should require all employees applying for a paid leave of absence to submit a bond that would indemnify the university if the employee fails to render service to the university following a leave of absence. The university should also maintain appropriate documentation supporting any leaves of absence it grants. Finally, the board should establish a policy on the extent to which it wants to be informed of such leaves of absence for management personnel.

Response

Improved regulations that include specific eligibility criteria and time restrictions for paid leaves of absences for management personnel have already been implemented, as seen in Technical Letter HR/Leaves 2009-01 (Attachment A). In response to the need for provisions designed to protect the university from financial loss if an employee fails to render service to the university following a leave, CSU will develop a return service obligation that contains requirements for university indemnification for management personnel given a paid administrative leave pursuant to Section 42729 (b) only. Section 42729 (a) type leaves will not require a return service obligation and therefore no bond submission.

  • California State Auditor's Assessment of Status: Not Fully Implemented
  • Completion Date: January 2013
  • Response Date: September 2012

Recommendation To: University, California State

The university should strengthen its policy governing the reimbursement of relocation expenses. For example, the policy should include comprehensive monetary thresholds above which board approval is required. In addition, the policy should prohibit reimbursements for any tax liabilities resulting from relocation payments. Finally, the board should require the chancellor to disclose the amounts of relocation reimbursements to be offered to incoming executives.

Response

The Chancellor had a general discussion with the CSU Board of Trustees (board) regarding its involvement in approving relocation reimbursements. The board determined that revising the policy to include monetary thresholds that would require progressive levels of authority for approval, with the Chancellor or President of a campus having to approve the highest threshold, would be sufficient. The CSU distributed a revised relocation policy in January 2012 that includes such progressive monetary thresholds and a prohibition against reimbursing employees for any tax liabilities that result from receiving relocation payments. In addition, CSU reports relocation reimbursements to the board on an annual basis.

  • California State Auditor's Assessment of Status: Fully Implemented
  • Completion Date: September 2012
  • Response Date: September 2012

Recommendation To: University, California State

The university should continue to work with California Faculty Association representatives during the collective bargaining process to strengthen its dual-employment policy by imposing disclosure and approval requirements for faculty. It should also impose similar requirements for other employees, including management personnel. If the university believes it needs a statutory change to facilitate its efforts, it should seek it.

Response

The CSU/CFA CBA (effective 9/18/12) contains a requirement for full-time faculty to disclose outside employment above 160 hours/semester or 120 hours/quarter. CSU will move to require similar reporting standards for other employee groups, including MPP's. To continue the process of similar requirements for other represented employee groups will require collective bargaining. The imposition of similar requirements on MPP's will require Board of Trustee action to change Title V, and the CSU intends to pursue these changes for MPP's.

  • California State Auditor's Assessment of Status: Not Fully Implemented
  • Completion Date: Unknown
  • Response Date: September 2012

Recommendation To: University, California State

To provide effective oversight of its systemwide compensation policies, the university should create a centralized information system structure to catalog university compensation by individual, payment type, and funding source. The university should then use this information to monitor campuses' implementation of systemwide policies and measure the impact of these policies on university finances.

Response

As explained in past responses, after management conferred with the CSU Board of Trustees in January 2008, the CSU opted not to create a new centralized data system that would require more than 100 additional support staff. Instead, CSU required campus presidents to seek approval of initial compensation offers to new vice presidents and approval of changes in compensation for existing vice presidents. Reports have been made to the CSU Board of Trustees since November 2008, September 2009, September 2010, and September 2011. In addition the CSU created and delivered a training program to 939 CSU personnel (both campuses and Chancellor's Office) involved in keying salary and payroll data. This training has also been converted to an online e learning module and new employees involved in data entry relating to payroll and salary are required to take this training.

  • California State Auditor's Assessment of Status: Will Not Implement
  • Response Date: November 2010

Current Status of Recommendations

All Recommendations in 2012-041