A controversial plan to switch thousands of state employees from semi-monthly to biweekly pay next month is on hold, after the state Enterprise Resource Planning Board voted Monday to delay the switchover.
State Auditor Glen Gainer objected to the delay, accusing legislative leaders of "playing politics with pay" in raising objections to the change - particularly that the current biweekly pay plan will provide salaried employees with a bonus 27th paycheck once every 11 years.
"This is nothing but political gamesmanship," Gainer said after the meeting. "Every major employer in the (Kanawha) Valley pays this way."
Legislative leaders have objected to the current biweekly plan over the bonus paycheck scenario, which would cost an estimated $55 million when it next comes up in 2020. Legislative auditors contend the additional paycheck could be illegal, since state law prohibits paying state employees prior to their services being rendered.
During interim meetings in October, Senate President Bill Cole, R-Mercer, said of biweekly pay: "We intend to pay every dime we owe every state employee ... but we don't intend to find $4 million or $5 million (a year) in the state budget to handle the decimal point."
However, Gainer said Monday that the delay will cost taxpayers money by complicating calculations of leave time and pensions.
"I don't believe we did anything wrong," he told the board. "I believe we're being asked to chase pennies with dollars, and it will cost the taxpayers."
The issue with the current biweekly plan is that it divides the year into 26 14-day pay periods, leaving the 365th day as a bonus day that legislative leaders contend would result in state employees essentially being paid twice for the day.
Gainer on Monday provided a display showing that the Legislature's proposal to incorporate the 365th day by calculating 26.08928571 pay periods a year also overpays salaried employees while complicating pension and leave time calculations.
Using a hypothetical employee with a salary of $27,990, under the current biweekly plan, the employee comes up $179 short in the transition year, and gets an extra paycheck of $1,076 in 2020, for an additional $897 overall.
With the legislative plan, Gainer said, that employee is shorted $234 in the transition year and $95 each year afterward, but gets $977 of additional pay in 2020, for an additional $359 overall.
Gainer also noted that the ERP Board approved the transition to biweekly pay more than two years ago, following recommendations of a 15-member steering committee that included two representatives of the Legislature - Sen. Robert Plymale, R-Wayne, and Delegate Brent Boggs, D-Braxton - who endorsed the change.
"What changed between Oct. 7, 2013 and today, other than political change in the Legislature?" Gainer asked.
Cole and House Speaker Tim Armstead, R-Kanawha, issued a joint statement late Monday thanking Gov. Earl Ray Tomblin and Treasurer John Perdue for halting further implementation of the new payroll system. The two said they look forward to continuing to work with Tomblin and Perdue in a bipartisan manner to ensure state employees are paid fairly and accurately.
"The fact that we have spent more than $123 million on a software system that apparently can't handle an additional decimal point is simply beyond the pale, and for the Auditor to point political fingers in this matter is equally disturbing," the statement reads. "This is not about politics, this is about math, and the Auditor's figures simply do not add up. Legislative leadership has spoken out, the Treasurer and Governor have voiced concerns and members of the judiciary are also considering legal action. If members of all three branches of government have concerns, it is simply not a political issue."
Cole and Armstead said the wvOASIS supercomputer had been an "overpriced and poorly implemented program" since before Republicans took the majority last year and that it was time for answers.
"Also, the Auditor's statement that we're now spending 'dollars to chase a few pennies' is reckless, if not downright wrong," the statement continues. "First, his office has consistently refused to provide information about how much a fix would cost. And more importantly, we feel the millions of dollars in additional costs that our legislative audit found this conversion would create amounts to much more than 'a few pennies.' To suggest such an amount of money is insignificant or not substantial - particularly in these trying budgetary times - is shockingly out of touch."
Perdue made the motion to delay the second wave of employees set to switch to biweekly pay in December to "allow time to address the concerns."
Perdue, who is expected to be named as party in an employee grievance filed by 24 Division of Highways employees who contend they were shorted pay during the first wave that switched 9,000 employees to biweekly pay effective in June, first called for the delay in September.
The first wave included the governor's, auditor's and treasurer's offices, Departments of Agriculture and Transportation, and Divisions of Natural Resources and Administration.
The postponed second wave was to include all other state agencies, except for West Virginia University, WVU-Parkersburg and Marshall.
State Family Court Judges had prepared a petition to the state Supreme Court seeking a writ of prohibition to prevent the second wave of pay transitions from proceeding, arguing that court employees would lose pay this calendar year, but delayed filing it until after Monday's ERP Board meeting.
"It's clearly good news," Webster County Family Court Judge Jeffery Hall said Monday of the vote to delay the transition.
"We were minutes away from walking that writ to the Supreme Court," he said, adding, "If we're facing this again in April, we're going to be back to square one."
Gainer said Monday that with Monday's vote to delay implementation of the second wave, the next opportunity to switch employees to biweekly pay will come next April or May.
The ERP Board, created to oversee implementation of the state's $123 million wvOasis supercomputer, is made up of the governor, auditor and treasurer, and is guided by a 15-member steering committee, made up of representatives of state agencies as well as two legislators.
Reach Phil Kabler at philk@wvgazettemail.com, 304-348-1220 or follow @PhilKabler on Twitter.