Financial Policies Training: General Funds Fringe Benefits (2.1.25) Effective: July 1, 2009

These PowerPoint slides are intended for training purposes. In the event of any discrepancy or interpretation difference between the policy and the slides, the policy dictates.

The Board of Trustees Resolution approved November 18, 2008 and the Structural Deficit Policy (2.1.17) which became effective on that date state that one of the corrective measures for addressing the institutional deficit is the establishment of a fringe benefits policy. The General Funds Fringe Benefits Policy (2.1.25) fulfills a component of that requirement. Background Information

Addresses UC general funds fringe benefits Fringe benefits, depending on employee group and choice, may include, for example: Health and dental care insurance Retirement contributions Life and disability insurance Tuition remission Sick and vacation time off and payout The fringe benefit fund is listed as a structural overdraft as defined by university policy Policy

Organizational units in the general fund are responsible for funding fringe benefits associated with the changing of budgeted salaries of employees in their respective areas. Policy States

Apply to all benefits-eligible employee groups Standards include: For any increase to a salary budget (one-time or permanent) outside of planned institutional annual increases, the org unit must provide the associated increase of funding for fringe benefits Fringe benefits budgets must only be used for funding benefits expenses No other purpose is permitted Use for (one-time or permanent) budget reductions is prohibited Any decrease to a salary budget (one-time or permanent) will not produce benefit dollars the org unit can transfer or use for any other purpose Standards for Fringe Benefit Funding

Funding transfers among salary general ledger accounts: When transferring funds between the same salary general ledger account Fringe benefits follow at the same rate regardless of the cost center When transferring funds among salary general ledger accounts with different fringe rates Fringe benefits will be credited regardless of the cost center (If lower  higher rate) the unit must fund the difference (If higher  lower rate) the cost differential is not released back to the unit Budget Transfers

Resources General Funds Fringe Benefits Policy (2.1.25): Structural Deficit Policy (2.1.17): Fringe Benefit Rates and Rate Components Policy questions