County still untangling payroll
By Steve Herring
Published in News on August 11, 2013 1:50 AM
Wayne County commissioners continue to struggle with how to correct the damage left by a failed attempt to switch to a new payroll system that either underpaid or overpaid most of the county's employees during the six months it was in place.
It has been a year since the county went to the new payroll system, and nearly eight months since it was scrapped in order for the county to return to the old system. But still unresolved is how, or if, it is financially feasible to recoup $500,000 in overpayments.
Also to be addressed are $12,340.89 in underpayments.
One response to the problems has been to move payroll from human resources to the finance department.
"I hope that the first order of business is to make sure that we go through that report to identify those who were underpaid and make sure that those payments are made promptly," Commissioner Joe Daughtery said during the board's meeting last week. "We need to address that issue as soon as possible."
"I agree with Mr. Daughtery that they need to be paid and we need to do that first," said Commissioner Bill Pate. "But we still have the issue of the overpayments -- what process we will take to return those dollars because they are taxpayers' dollars.
"If it (recouping overpayments) is going to cost us more to do it than what we are going to get back we need to look at that. So we need to know what the cost of recovering those dollars is before we can move forward."
Commissioner Ray Mayo said he would like for the board to consider directing County Manager Lee Smith, County Attorney Borden Parker, the county Finance Department, and auditors with Nunn Brashear & Co. to conduct a detailed study on what the board's options are to collect the overpayments.
That needs to come back to the board in no more than 90 days as to what is legal and what the board can do to collect the overpayments, he said.
"We don't have any idea at this point what we can do, really, to recoup the overpayments," Mayo said. "We need to know what those steps are. I would recommend that we direct our county manager to do that study along with his staff and whoever he needs to pull in in order to get that done."
Daughtery said he would like to see the study done in less than three months and preferred 30 to 45 days instead.
Mayo said his request was also a motion and that the recommendations must be submitted no later than Sept. 17.
Before the vote, Chairman Steve Keen said he wanted to amend the motion to add Mayo, Daughtery and Pate to the group.
"Is that amendment appropriate?" he said.
Parker said he did not recommend the amendment, or think that it was necessary, since the motion including bringing in whoever was needed.
Keen, who withdrew his amendment, said that he had wanted commissioners involved, but wanted to ensure that the meetings did not violate the state's Open Meetings Law.
"I want everybody to keep in mind that we are talking about 2012 pay and you have got to consider the Internal Revenue (Service)," Commissioner John Bell said. "We can't go back to 2012. There is conflict there."
Mayo said he agreed and that was why he had suggested the study to determine the impact and what the county could do about the overpayments.
Commissioners need to know what the options are, but that doesn't mean they are going to take any action, he said.
The motion was approved 6-0. Commissioner Wayne Aycock did not attend the meeting.
Commissioners earlier this year hired Nunn Brashear & Co. to prepare an audit on the payroll issues. The report was presented at the board's July 16 session.
Auditors recalculated the wages of all employees paid during the six-month period from July 1, 2012, through Dec. 31, 2012, as if the county had stayed with the GEMS payroll system.
They also compared the pay calculations with the six month pay data from the Ceridian system that was utilized during the six-month period to determine individual employee overpayments and underpayments.
According to the report, countywide underpayments totaled $12,340.89 and overpayments $502,990.68.
At the July 16 board session, Nunn Brashear & Co.'s Danna Layne said she met with the departments and examined their records.
Approximately 65 county employees were underpaid and have not been paid, she said. Approximately 600 county employees were overpaid, she said.
The Sheriffs Office ($81,667.37), Office of Emergency Services ($214,096.97) and Social Services ($100,085.51) had the largest overpayments, accounting for a total of $395,849.85 or nearly 80 percent of the $502,990.68.
The largest overpayment was to a Social Services retiree in the amount of approximately $10,000, Ms. Layne said.
Social Services did not receive the July payroll report until September, she said.
During previous board meetings Smith and Human Resources Director Sue Guy have indicated the underpaid employees had been paid.
The News-Argus sent an email to the county's finance office asking if the underpaid employees had been paid and if any overpayments had been recouped. The county also was asked if the payroll reports had been available to department heads online and if a July payroll report had been hand-delivered in August.
There was no response.
County Public Information Officer Barbara Arntsen was asked as well.
She did not respond to the specific questions saying instead, "Wayne County auditors Nunn, Brashear & Co. presented an in-depth study of the payroll system at the July 16 commissioner meeting. The facts, figures and information presented in the payroll study are the result of months of interviews and analysis.
"Wayne County has the utmost respect for the county's auditors and believes the information presented by Nunn, Brashear & Co. to be accurate. Answers to your questions were in the report presented by auditors to the board in July."