December 26, 2024

Tips for Processing Lump Sum Separations

Action Required: Share the following information with all Human Resources (HR) office employees. 

Description: To help ensure that your lump sum separation Personnel Action Request (PAR) packages are accurately processed and meet the mandated requirements, use the tools in the Lump Sum Separation Toolkit and follow these tips. 

  • Submitting a PAR package when the employee is requesting to contribute into Savings Plus for the 2025 tax year ONLY: If an employee is separating in November or December, and they are requesting to contribute into Savings Plus for the 2025 tax year only, then the department must submit a second tax year PAR package to the State Controller’s Office (SCO). 
    • The department will key the first tax year PAR for the 2024 tax year with the effective date and line item 606/888 to ensure no additional regular pay issues beyond the employee’s separation date. 
    • The department must then submit the second tax year PAR package (per the dates in Payroll Letter #24-014) to SCO. 
      • In Section II of the coversheet, select 2nd Tax Year PAR of a two-tax year PAR Package with Savings Plus Contribution. 
      • Also, the coversheet must be notated with “2nd tax year” in the Message section.  
    • SCO will process the PAR after the close of the 2024 tax year, and the lump sum payments and Savings Plus contributions will issue in the 2025 tax year. 
  • Entering time in PAR Items 620 and 625 when the employee is deferring leave into two (2) tax years:  
  • On the first PAR (first tax year), complete PAR Item 620 (lump sum vacation) with only the time needed to process the employee's request for the first tax year. 
    • Note: Add time to PAR Item 625 (lump sum extra) only after all lump sum vacation is entered in Item 620 and more time is needed to cover the employee's request for the first tax year. 
  • On the second PAR (second tax year), in PAR Items 620 and 625, enter the employee’s total accrued leave to be paid out across both tax years. 
  • Checking the status of a lump sum separation PAR package submitted to SCO: See question #8 in the “Lump Sum Separation Pay FAQ" for the steps to follow to check the status of a lump sum separation PAR package submitted to SCO. 

Population Affected: All HR Offices