POLICY 06:29:00

LONGEVITY PAY

Please refer to Tennessee Board of Regents Guideline No. P-120
Purpose

The purpose of this guideline is to establish the process regarding longevity pay for employees of
Pellissippi State Community College as governed by the Tennessee Board of Regents.

Policy/Guideline

1. Introduction
   1. The 89th General Assembly of the State of Tennessee adopted a longevity pay
      plan to reward State employees for extended service to the State. The plan became
      effective on July 1, 1979, was amended July 1, 1980 to include faculty members
      of the State’s public higher education institutions, and was further amended on
      July 1, 1994 to include regular part-time employees who are scheduled to work
      1600 or more hours (82.1 percent time) in a fiscal year.
      1. In addition, effective July 1, 1995, regular full-time employees with 36
         months of full-time service became eligible to receive longevity credit for
         prior part-time service that is equivalent to not less than 5 years of full
         time service. Its continuation each year is subject to positive action by the
         State Legislature.
2. Eligibility
   1. Upon completion of 36 months of service, all regular full-time and faculty,
      clerical and support staff, administrative/professional employees, and modified
      fiscal year (MODFY) employees are eligible for longevity payments.
      1. In addition, all regular part-time employees who are scheduled to work
         1600 or more hours (82.1 percent time) in a fiscal year and have 36
         months of service are also eligible for longevity payments. (Refer to
         Section IV, B for additional information regarding credit for part-time
         service.)
      2. The 36 months of qualifying service must be in an eligible status as
         defined below.
      3. For purposes of creditable service for longevity payments, the service base
         of employees in faculty, MODFY, or eligible regular part-time
         appointments shall be considered to be a full 12 months.
3. Compensation
   1. Eligible employees shall receive longevity pay at an established rate for each year
      of creditable service up to the maximum provided by law.
      1. The rate per year of service is established annually by the Legislature.
      2. For employees who completed 15 years of creditable service prior to July
         1, 1984, September 1 shall be their longevity anniversary date.
      3. Payments will be made in the College’s payroll corresponding with
         September anniversaries.
      4. All other employees who have three years or more of creditable service
         shall receive their longevity payments in conjunction with their longevity
         anniversary date and in accordance with institutional payroll procedures.
   2. Calculation of longevity pay is based on an employee’s total years of eligible full
      time service and eligible part-time service and the rate of pay in effect for the
      fiscal year in which the payment is made.
      1. Shown on the following table are the rates of pay per year of eligible
         service, the maximum years of service for which payment would be made,
         and the maximum payment made to any individual during each of the
         years since the longevity pay program began.
         Rate of Pay Per Maximum Longevity Pay Chart
      2. *Faculty members were included in the longevity pay plan effective July
         1, 1980.
         1. During fiscal year 1980-81 faculty received $45 per year of
         eligible service up to a maximum of 15 years or $675.
         2. This special rate for faculty was provided for this one year because
         faculty improvement funds were provided in lieu of longevity pay
         during fiscal year 1979-80.
   3. The following describes longevity provisions for non-exempt employees under
      the FLSA.
      1. The method of paying overtime on longevity became effective with the
         coverage of non-exempt state employees by the Fair Labor Standards Act
         (workweek of April 15, 1986) and applies only to that portion of the
         employee’s longevity work year after that date.
      2. The value of longevity pay is not included in the week-to-week calculation
         of regular hourly rate for overtime payment purposes.
      3. But, when longevity pay is given, ½ the hourly equivalent rate of the
         longevity payment is due for all premium overtime hours earned during
         the prior year of service for which the longevity payment is made.
         1. For example, a non-exempt employee worked 2150 hours during
         the year including 100 hours of premium overtime and received
         $750 longevity payment.
         2. The overtime due on the payment would be $750 divided by 2150
         hours = $.348 hourly equivalent time ½ = $.174 per hour times 100
         premium hours = $17.40 additional overtime longevity payment.
   4. Longevity pay is subject to Federal Withholding Tax and Social Security taxes.
      1. Effective January 1, 2004, the College may select either Option A or
         Option B as provided in IRS Circular E – Supplemental Wages to
         determine the Federal Withholding Tax.
      2. The Social Security Tax is assessed at the prevailing rate.
   5. The gross dollar value of the longevity payment is considered as covered salary
      for purposes of calculating retirement benefits.
4. Longevity Service Credit
   1. Adjusted Longevity Anniversary Date
      1. The adjusted longevity anniversary date shall be that date on which 36
         months of creditable regular state service is completed.
      2. A longevity anniversary date is established for all employees who are
         eligible or potentially eligible to participate in the program.
      3. At the time of initial employment, the employee’s longevity anniversary
         date is established utilizing all periods of prior eligible service with the
         State or one of its agencies or an institution within the Tennessee Board of
         Regents or the University of Tennessee systems.
      4. If the employee does not indicate prior service, the longevity anniversary
         date is the same as the initial employment date.
   2. Eligible Service
      1. The following types of service are considered eligible service when
         establishing an individual’s adjusted longevity anniversary date:
         1. All regular full-time service with the Tennessee Board of Regents,
         University of Tennessee or Tennessee Government to include
         agencies, offices, departments or other subdivisions of the
         Executive, Judicial, or Legislative branches.
         2. Effective July 1, 1995, all regular full-time service of 36 months
         and prior regular part-time service that is the equivalent of 5 years
         of regular full-time service with any of the organizations listed
         above. Credit for such prior part-time service is prospective only.
      2. All regular part-time service in which the employee was scheduled to
         work 1600 or more hours in a fiscal year with any of the organizations
         listed above.
      3. Periods in which regular part-time employees work additional hours,
         resulting in a fiscal year work schedule of 1600 or more hours. (See
         IV.B.11.)
         1. Example: On July 1st, an employee was appointed as a regular
         part-time employee at 50% time. On September 1st, he was asked
         to work 100% time until another person could be hired. By June
         30th of that fiscal year, he had actually worked more than 1600
         hours. On July 1st, he changed to full-time on a regular basis; and
         he received longevity credit for the prior fiscal year. (See Section
         IV.B.12.)
      4. Eligible temporary service with any of the organizations listed in 1 above,
         which immediately precedes the regular full-time service.
         1. Effective July 1, 1995, eligible temporary service includes all part
         time temporary service that is the equivalent of 5 years of full-time
         service which immediately precedes regular full-time service.
         2. Credit for eligible part-time service will be given when 36 months
         of regular full-time service has been rendered and will be
         prospective only.
      5. Periods during which the employee is in an approved paid leave status.
      6. Periods during which a normally eligible employee is working a
         temporarily reduced work schedule of not less than 50% of full-time and
         for a period not to exceed six months.
      7. Periods during which the employee is on leave of absence without pay and
         is receiving compensation from the State Board of Claims for an on-the
         job injury or illness.
         viii. Any employee otherwise eligible who is on military leave.
      8. Periods during which an employee is on an approved grant-in-aid.
      9. Periods during terminal leave status.
      10. Employees currently eligible for longevity pay who have prior part-time
          service consisting of at least a 1600 hours annual schedule shall receive
          longevity credit for each month of such part-time service in which the
          employee was scheduled to work a full month and actually worked one
          tenth of one hour more than half the schedule.
          1. This provision became effective July 1, 1987. Effective July 1,
          1995, eligible employees shall receive credit but not retroactive
          longevity payments.
          2. In other words, the employee who changes status as described in
          this section shall receive credit for the time worked, but will not
          receive longevity payments for credited time until the next fiscal
          year when the prior part-time service is calculated into the
          longevity payment.
      11. Regular employees may receive longevity credit for adjunct faculty
          service if the following conditions apply:
          1. The employee’s work schedule for the fiscal year consisted of the
          equivalent of 1600 or more hours. Effective July 1, 1999,
          equivalent hours shall be calculated for each semester/quarter and
          then added together to obtain the total equivalent hours for the
          fiscal year. (The following formula will be used to determine the
          equivalent hours: semester/quarter hours taught x 2.5 x number of
          weeks in semester/quarter = clock hours)
          a. Example: Employee taught 9.0 hours the second session of
          Summer 1997, 15.0 hours Fall Semester 1997, 15.0 hours
          Spring Semester 1998, and 6.0 the first session of Summer
          1998.
          Summer 1997 (2nd Session) 9 x 2.5 x 6 = 135.0
          Fall 1997 15 x 2.5 x 17 = 637.5
          Spring 1998 15 x 2.5 x 17 = 637.5
          Summer 1998 (1st Session) 6 x 2.5 x 6 = 90.0
          Total hours for 1997-98 FY 1500.0 This employees’ work
          schedule would not satisfy the 1600 or more hours criteria
          for the fiscal year.
          2. The adjunct faculty service immediately preceded eligible regular
          service.
          3. Eligible employees included in paragraphs 3, 4, and 7 above shall
          receive their longevity payment as normally scheduled.
          4. Eligible employees covered by paragraphs 5 and 6 shall receive
          their longevity payment upon returning to an active payroll status
          with the institution.
   3. Ineligible Service
      1. The following types of service are not considered as eligible service when
         establishing an individual’s longevity anniversary date:
         1. Part-time service (except as specified in Sections I, II and IV, B.9)
         or service as a student employee.
         2. Temporary service unless such service is full-time and
         immediately precedes regular full-time service.
         3. Service with elementary or secondary (K-12) public schools.
         4. Periods during which the employee is on FMLA or non-FMLA
         leave of absence without pay except when the employee is on
         approved leave of absence without pay due to an on-the-job injury
         or illness and where the employee is receiving benefit payments
         from the State (as in item B.5. above).
         5. Services rendered in addition to the employee’s regular duties,
         including the services of faculty for teaching summer school do not
         qualify as eligible service.
         a. Although such periods of service may immediately precede
         regular full-time service, they cannot be counted as eligible
         service in establishing the employee’s adjusted longevity
         anniversary date.
         b. Exception: Such Service is included only if it is combined
         with other regular or adjunct service in the same fiscal year
         to determine the employee’s eligibility for an adjustment
         under Section V.B.3., or IV.B.12.
   4. Rehiring Previous Employees
      i. When employing individuals with prior State service, the employee’s
      adjusted longevity date will be established utilizing all eligible prior
      service.
      ii. The adjusted longevity date will be used to initiate payments for current
      and subsequent fiscal years.
   5. Transfers
      i. Employees who transfer from one State agency to another without a break
      in service are eligible for longevity compensation in accordance with their
      adjusted anniversary month.
5. Changes in Employment Status
   1. Employees who change from regular part-time service of less than 1600 hours in
      a fiscal year, temporary or student status to regular full-time status or eligible
      regular part-time status become eligible to participate in the longevity pay plan.
   2. Employees who change from regular full-time or eligible part-time positions to
      regular part-time service of less than 1600 hours in a fiscal year and are in the
      regular part-time status of less than 1600 hours at the time of their longevity
      anniversary date will not be eligible for longevity payments.
   3. Eligible employees on an academic year pay base changing to a fiscal year pay
      base shall be eligible to continue receiving longevity payments and shall receive
      no change in service credit as a result of the transfer.
   4. Eligible employees on a fiscal year pay base changing to an academic year pay
      base shall be eligible to continue receiving longevity payments and shall receive
      no change in service credit as a result of the transfer.
6. Faculty
   1. Eligible faculty (other than those in Section III, Paragraph A) whose anniversary
      date is the beginning of the academic year shall receive their longevity payment in
      the last monthly payroll for the contract period.
   2. Eligible faculty members (other than those addressed in section III, paragraph A)
      whose anniversary date is other than the beginning of the academic year shall
      receive their longevity payment when the anniversary date occurs in the regular
      scheduled payroll cycle for that date.
7. Leave of Absence
   1. All employees who are on FMLA or non-FMLA leave of absence without pay are
      entitled to longevity payment on their adjusted longevity anniversary date upon
      return from said unpaid leave.
8. Termination of Employment
   1. The following longevity pay regulations apply to persons who terminate their
      employment for any reason other than retirement:
      1. If a terminating employee has completed an additional year of creditable
         service for longevity payment purposes, and then the longevity payment
         shall be made. However, no pro-rata payment will be made for a partial
         year’s service.
      2. Terminating faculty whose anniversary date is the beginning of the
         academic year and who are otherwise eligible, shall receive their longevity
         payment in the final month’s payroll for the years’ service provided that
         the entire academic year was served.
9. Retirement
   1. Eligible retiring employees may receive their longevity pay if the longevity
      anniversary date occurs during their terminal leave period.
   2. All retiring employees are eligible for longevity pay following the completion of
      one year of creditable service.
   3. Faculty who retire after completing their responsibilities for the academic year are
      eligible for longevity pay in their final payroll for the academic year.
   4. Due to the cost-of-living adjustment for retirement purposes, a 12-month
      employee with a longevity anniversary date as July 1, who plans to retire prior to
      June 30 must be in active pay status on June 29 in order to be eligible for
      longevity pay.
10. Exceptions
    1. Exceptions to the provisions of these regulations may be recommended by the
       President for the Chancellor’s approval.
    Sources:
    TBR Guideline P-120; T.C.A. §§ 49-8-203; 8-23-206Approved by TBR: November 1, 1988
    Revised by TBR: May 15, 1990
    Revised by TBR: November 9, 1993
    Revised by TBR: November 9, 1994
    Revised by TBR: May 8,1995
    Revised by TBR: August 8, 1995
    Revised by TBR November 4, 1998
    Revised by TBR: November 3, 1999
    Revised by TBR: May 9, 2000
    Revised by TBR: November 5, 2003
    Revised by TBR: November 8, 2006
    Revised by TBR: August 21, 2007
    ShapeReviewed/Recommended: President’s Council, November 27, 2023
    Approved: President L. Anthony Wise, Jr., November 27, 2023