Title
Report back to the Board of Supervisors regarding discussions with Monterey County Employees concerning proposals for the Election of Cash Out of Vacation /Annual Leave/ Paid Time Off (PTO) and provide direction to staff. (ADDED VIA ADDENDUM)
Report
RECOMMENDATION:
It is recommended that the Board of Supervisors consider the following:
a. A presentation on additional consultations with Monterey County Employees on approaches to avoid constructive receipt by creation of a "Stand Alone" Program for the Election of Cash out of Vacation /Annual Leave/ Paid Time Off (PTO);
b. Direct that staff return with a recommendation to amend the County's Personnel Policies and Practices Resolution to add provisions for the Election of Cash Out of Vacation /Annual Leave/ Paid Time Off (PTO) that provides immediate protection from constructive receipt; and
c. Direct that staff pursue an Internal Revenue Service (IRS) Private Letter Ruling on the validity of an emergency provision request, developed as much as possible with bargaining units and unrepresented units, to the Cash Out of Vacation/Annual Leave/PTO Stand Alone Program.
SUMMARY/DISCUSSION:
Monterey County offers a Vacation Buy Back/Cash Out program to certain employees. According to our Auditor-Controller, the current program could be in non-compliance with Constructive Receipt Doctrine of the IRS, thus making the value of accrued leave taxable, if the County does not adopt a plan that has an irrevocable election component by December 31, 2015.
Staff originally agendized a proposal to place the buy-back/cash-out program into the County's existing Section 125 Plan for August 25, but re-agendized the matter to September 1, in response to concerns raised by various bargaining units. On September 1, the Board first considered the matter and then set a Special Meeting for September 11 so that staff could continue to meet with employee groups. On September 11, the Board directed the staff to deve...
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