Human Resources Policies

HR53 Deceased Employee's Final Salary Payment

Policy Status: 

Active

Policy Steward: 

Vice President for Human Resources

POLICY'S INITIAL DATE: November 25, 1953
THIS VERSION EFFECTIVE: March 17, 1997

Contents

PURPOSE:

To outline the policy to be followed when determining a deceased employee's final salary payment.

DETERMINING FINAL DATE FOR PAYMENT FOR A DECEASED REGULAR EMPLOYEE:

The final salary payment will be calculated on a pro rata daily basis to and including the date of death if the deceased was actively employed, using vacation, sick leave, other paid time off, or on leave with pay. If the deceased employee was included in a vacation plan that provides for the payment of unused vacation at the time of termination of employment, a payment for unused vacation, service days, or compensatory time off, if any, will also be included in the final salary check.

However, the additional payment shall not cause the faculty or staff member's pay to exceed the total pay specified in the terms of a fixed-term appointment; nor shall the additional payment be made for an employee on a permanent layoff, or on a layoff where recall had been anticipated more than 30 days from the date of death, even though such employee may be receiving payment for accumulated time off. The payment will be made on a special check issued to the proper payee in accordance with the laws of the Commonwealth of Pennsylvania. No deductions will be made from the special check.

DETERMINING FINAL PAYMENT FOR A NONREGULAR EMPLOYEE:

In the event of death of a nonregular employee, wages will be paid to and including the last day on which the deceased employee worked. If the deceased employee was included in the earned time program as provided for in HR05, "Regular and NonRegular University Employees," a payment for unused earned time and service days, if any, also will be included in the final check for wages.

DEDUCTION FROM FINAL PAYMENT:

Payroll deduction will be applied to the final payment in accordance with the following schedule:
Type of Deduction Amount Deducted
Federal Income Tax Not deducted
Local Wage Tax Not deducted
State Income Tax Not deducted
Retirement Contributions Deduction made on salary or wages, excluding vacation or lump sum death payment.
Healthcare Deductions made
Life Insurance Deductions made
Voluntary AD & D Insurance Deductions made
Long Term Disability Deductions made
Flexible Benefits Deductions made
Social Security Deductions made on salary or wages if total annual earnings do not exceed the taxable base (only if paid in the same calendar year)
Union Dues and Fair Share Fee Deductions made if final check is regular dues deduction check
Special Union Deductions Not Deducted
U. S. Savings Bonds Not Deducted
Credit Union Not Deducted
Parking Fee Not Deducted
Contributions to Penn State Not Deducted
Tax Deferred Annuity Deduction will be made if funds are sufficient

Questions regarding the specific deductions from the final salary check should be directed to the Payroll Department (865-7621).

ISSUANCE OF FINAL SALARY CHECK:

The final salary check of a deceased employee will be issued to the proper payee in accordance with the laws of the Commonwealth of Pennsylvania as follows:

  1. If the net amount of the final salary check after payroll deductions is $5,000 or less, it may be made payable to the surviving spouse, any child, the father or mother, or any sister or brother in the order named.
     
  2. If the net amount of the final salary check after payroll deductions is in excess of $5,000, $5,000 of the total amount may be made payable to the surviving spouse, any child, the father or mother, or any sister or brother in the order named, and the amount in excess of $5,000 shall be made payable to the estate of the deceased employee.