Report 2012-603 Recommendations and Responses in 2015-041

Report 2012-603: High Risk Update: State Agencies Credited Their Employees With Millions of Dollars Worth of Unearned Leave

Department Number of Years Reported As Not Fully Implemented Total Recommendations to Department Not Implemented After One Year Not Implemented as of 2014-041 Response Not Implemented as of Most Recent Response
California Department of Human Resources 1 6 4 N/A 4
California Science Center 1 1 1 N/A 1
State Controller's Office 1 3 2 N/A 2

Recommendation To: Human Resources, California Department of

To correct the erroneous leave hours we identified in our analysis of the leave accounting system, CalHR should work with the state controller and all state agencies under its authority to review and take the appropriate action to correct the errors by January 2015.

Response

CalHR worked with the State Controller and provided instructions to all affected agencies on how to confirm and take appropriate action to correct the errors identified by the CSA. CalHR has also requested agencies to update CalHR of its progress in reviewing and correcting errors. Some errors identified in the CSA's report are unable to be corrected by the affected agency (e.g., overpayment occurred outside the statute of limitations or the agency was unable to verify the error). However, CalHR has provided instruction to agencies to correct the errors that may lawfully be corrected, and will continue to assist each affected agency as needed

  • California State Auditor's Assessment of Status: Partially Implemented
  • Estimated Completion Date: August 2015
  • Response Date: August 2015

Recommendation To: Human Resources, California Department of

To ensure that state agencies accurately account for their employees' leave benefits, CalHR should consolidate guidance by January 2015 regarding the appropriate amount of leave that employees should earn each month and provide these criteria to the state controller to use when developing the leave accounting system's monthly exception reports. For example, CalHR should identify the number of holiday credit hours that employees covered by each collective bargaining agreement should receive for working on a holiday.

Response

CalHR has finalized guidance for annual leave, vacation, sick leave, and personal holidays, and has provided the guidance to the State Controller's Office.

CalHR has nearly completed drafting consolidated guidance regarding state employee holidays. Before providing the guidance to state agencies, CalHR must determine the appropriate next steps consistent with the Ralph C. Dills Act. Once finalized, and after CalHR has fulfilled its obligations under governing labor law, the guidance will be provided to state agencies and the State Controller's Office.

  • California State Auditor's Assessment of Status: Partially Implemented
  • Estimated Completion Date: 08/26/2016
  • Response Date: August 2015

Recommendation To: Human Resources, California Department of

To ensure that state agencies accurately account for their employees' leave benefits, CalHR should establish general parameters and issue guidance to state agencies by January 2015 on how to account for the leave hours for employees who work alternate work week schedules.

Response

CalHR has completed guidance providing general parameters regarding how state agencies should implement and maintain alternate work week schedules for their employees. The guidance will govern how employees request and maintain alternate workweek schedules, and instruct agencies on the proper maintenance of leave hours for employees on alternate workweek schedules. Before providing the guidance to state agencies, CalHR must determine the appropriate next steps consistent with the Ralph C. Dills Act. Once finalized, and after CalHR has fulfilled its obligations under governing labor law, the guidance will be provided to state agencies.

  • California State Auditor's Assessment of Status: Partially Implemented
  • Estimated Completion Date: 08/26/2016
  • Response Date: August 2015

Recommendation To: Human Resources, California Department of

To ensure that state agencies accurately account for their employees' leave benefits, CalHR should provide additional guidance to state agencies by January 2015 on interpreting the provisions of the collective bargaining agreements related to the amount of leave employees earn. For example, CalHR could provide scenarios to illustrate the number of hours employees should earn under common circumstances.

Response

CalHR has developed consolidated guidance regarding state employee leave benefits, including annual leave, vacation, sick leave, and holidays. The guidance will include information reflecting the leave benefits set forth in state employee collective bargaining agreements. Before providing the guidance to state agencies, CalHR must determine the appropriate next steps consistent with the Ralph C. Dills Act. Once finalized, and after CalHR has fulfilled its obligations under governing labor law, the guidance will be provided to state agencies and the State Controller's Office.

  • California State Auditor's Assessment of Status: Partially Implemented
  • Estimated Completion Date: 08/26/2016
  • Response Date: August 2015

Recommendation To: Science Center, California

By February 2015 the Science Center should provide training to all of its personnel specialists on the number of leave hours employees earn for working on holidays.

Response

The California Science Center will continue to work with the State Controller's Office (SCO) and CalHR on leave balance corrections pertaining to Holiday Credit.

The California Science Center will send staff to the SCO's Leave Accounting System Training (CLAS refresher training) as soon as it is available.

  • California State Auditor's Assessment of Status: Pending
  • Estimated Completion Date: Unknown at this time
  • Response Date: August 2015

Recommendation To: Controller's Office, State

To improve the accuracy of information in the leave accounting system and to ensure that agencies do not improperly credit employees with leave in the future, the state controller should implement additional controls by June 2015 to prevent the leave accounting system from processing the types of inappropriate transactions we identified in our statewide electronic analysis. For example, it could develop cost-effective controls in the leave accounting system that would prevent employees from receiving annual leave and sick leave during the same pay period.

Response

Our original proposal to modify our system to prevent employees from accruing both Annual Leave and Sick Leave simultaneously was found to be not feasible. Therefore, we have begun the process of developing new business requirements for updating the leave accounting system's audits to prevent dual accruals from posting for these benefits. This complex effort should be completed by Summer 2017. In the meantime, all employees who were accruing both Annual Leave and Sick Leave have been identified and the Sick Leave accruals have been turned off. Also, an exception report has been created, and will be made available to the departments by Fall 2015. The SCO is now monitoring for any dual accruals on a monthly basis, and making necessary corrections. In addition, we are making other system modifications for the Personal Holiday and Holiday Credit benefits, to prevent accruals from posting for ineligible employees, and to automatically calculate the "earn" transaction amount for employees who work on a holiday. However, we are awaiting CalHR policy clarification regarding both Personal Holiday and Holiday Credit. System modifications for Personal Holiday and Holiday Credit that may be made without CalHR's input will be implemented between Fall 2015 and Spring 2016, respectively. In addition, we are currently developing a system change in which the leave accounting system will warn users when they attempt to credit an employee with an unusually high amount of earned hours. Users must validate the amount before completing the transaction. This warning message will be implemented by Summer 2016.

  • California State Auditor's Assessment of Status: Pending
  • Estimated Completion Date: Summer 2017
  • Response Date: August 2015

Recommendation To: Controller's Office, State

To improve the accuracy of information in the leave accounting system and to ensure that agencies do not improperly credit employees with leave in the future, the state controller should, using criteria provided by CalHR, develop monthly exception reports that identify transactions in the leave accounting system that are inconsistent with the guidelines established in state law and collective bargaining agreements, such as instances in which state employees receive too many personal holidays or too much holiday credit. By June 2015 begin providing each state agency's human resources management with the transactions identified in the exception reports for review and correction as necessary.

Response

We completed three of four planned reports and have begun developing additional reports to ensure leave records are accurate. First, in May, per CalHR's request, we reduced the hours in the existing High CTO, Holiday Credit, or Excess Hours Report from 100 hours to 80 hours for CTO, 30 hours for Holiday Credit, and 8 hours for Excess. We plan to further refine this monthly report by including errors from previous months until they are corrected; the current report includes transactions for the prior leave period only. Second, as requested by CalHR, the SCO made the Leave Activity and Balance (LAB) Report available for download from ViewDirect to Excel. Third, an exception report has been created to locate when both Annual Leave and Sick Leave accruals are received, and will be made available to departments by Fall 2015. We are continuing to develop a report to identify instances in which employees are credited with Holiday Credit in a leave period that has no holidays (i.e., April, June, August, and October); this report will be available by Fall 2015.

In addition to exception reports, the SCO plans to eliminate the transaction that is currently used to post duplicate Holiday Credit "earn" transactions. Also we are developing separate tracking for employees who work on a holiday. These system updates will be done instead of an exception report, which will bring more clarity to the reason hours are being posted. This effort will be completed by April 2016.

  • California State Auditor's Assessment of Status: Partially Implemented
  • Estimated Completion Date: Fall 2015
  • Response Date: August 2015

Current Status of Recommendations

All Recommendations in 2015-041