| AwardYear: 1995-1996 EnterChapterNo: 7 EnterChapterTitle: Federal Work-Study Program SectionNumber: 3 SectionTitle: Paying Students PageNumbers: 15-18 For information about determining the federal share and institutional share of FWS payments to students, refer to Section Five of this chapter. ESTABLISHING WAGE RATES Undergraduate students are paid FWS wages on an hourly basis only. Graduate students may be paid by the hour or may be paid a salary. Regardless of who employs the student, the school is responsible for making sure the student is paid for work performed. [[Determining work schedule]] A school should determine the number of hours a student is allowed to work based on the student's financial need and on how the combination of work and study hours will affect the student's health and academic progress. There are no statutory or regulatory limits on the number of hours per week or per payment period a student can work, provided no overaward occurs. (See Section Two of this chapter.) A student must be paid at least the current Federal minimum wage, but there is no maximum wage rate. At the time this chapter was printed, the minimum wage was $4.25 per hour. (As noted earlier, it is not permissible to pay a lower "subminimum" or "training" wage to students in FWS jobs.) A school may not count fringe benefits as part of the wage rate and may not pay a student commissions or fees. In determining an appropriate rate, the school must consider the following: [[Pay related to skills]] - the skills needed to perform the job; - how much persons with those skills are paid in the local area for doing the same type of job; - rates the school would normally pay similar non-FWS employees; and - any applicable federal, state, or local laws that require a specific wage rate. A student's need places a limit on the total FWS earnings permissible but has no bearing on his or her wage rate. It is not acceptable to base the wage rate on need or on any other factor not related to the student's skills or job description. If a student's skill level depends on his or her academic advancement, the school may pay a student on that basis. For example, a junior or third-year lab student may be paid a higher rate than a sophomore or second-year lab student. However, in most cases, students performing comparable jobs should be paid comparable wages, whether the jobs are performed by students at different class levels or by a student and a regular employee. DISBURSEMENT [[Pay student at least monthly]] A school must pay a student at least once a month. The federal share of FWS compensation must be paid by check or similar method (a draft or purchase order or electronic transfer to the student's bank account, for example) that the student can cash on his or her own endorsement. The school may not directly transfer the federal share to a student's account at the school, nor may it obtain a student's power of attorney to authorize any disbursement of funds unless ED has granted prior approval. Such a power of attorney (to allow a school to act on behalf of a student) would not be granted by ED unless the school could demonstrate that there is no one else who could act on behalf of the student (such as a relative, landlord, or member of the clergy, for example.) If the school pays its share of FWS wages by CHECK, it must pay the non-federal share to the student at the same time it pays the federal share. (See Section Five of this chapter for a discussion of federal and institutional shares of FWS compensation.) FWS wages are earned when the student performs the work. A school may pay the student after the last day of attendance for FWS wages earned while the student was still in school. However, when a student has withdrawn from school, FWS funds may not be used to pay for work performed after the student withdrew. A correspondence student must submit the first completed lesson before receiving payment. [[Noncash contribution]] If the school pays its share of FWS wages for an award year in the form of a NONCASH CONTRIBUTION (tuition, fees, services, or equipment), it must do so before the final payroll period of the award year. If the school pays this share in the form of PREPAID tuition, fees, services or equipment, it must give students- -again, before the end of the final payroll period--a statement of the amount of the noncash contribution earned. (For more information on using noncash contributions as part of the school's share of FWS wages, see Section Five of this chapter.) [[Payment period crosses award years]] When a payment period is in two award years (before and after July 1), the student is ordinarily paid for compensation earned through June 30 with funds allocated for the first award year, and, for compensation earned beginning July 1, with funds allocated for the following award year. For example, for a payment period extending from June 15, 1995 to July 15, 1995, a student would ordinarily be paid with the school's 1994-95 allocation through June 30 (the end of the 1994-95 award year), and with the school's 1995-96 allocation beginning July 1, 1995 (the beginning of the 1995-96 award year). [[The chart "Payment Period in Two Award Years" on page 7-17 is currently unavailable for viewing. Please reference your paper document for additional information.]] [[May "carry back" funds for summer]] A school may carry back funds for summer employment and may expend in the previous award year any portion of its initial and supplemental FWS allocations for the current award year to pay student wages earned on or after May 15 of the previous award year but prior to the beginning of the current award year. For example, a school is authorized to "carry back" any portion of its funds allocated for the 1995-96 award year to pay FWS wages for summer employment between May 15, 1995 and June 30, 1995. [[10% carry forward/carry back funds to award year]] In addition to the authority to carry back funds for summer wages, a school is also allowed to carry back up to 10 percent of the next year's FWS initial and supplemental allocation to the current award year for use at any time during the current award year, and to carry forward up to 10 percent of its FWS initial and supplemental allocation for the previous award year to the current award year. [[The chart on page 7-17 is currently unavailable for viewing. Please reference your paper document for additional information.]] If the school carries forward funds from the current award year to the following award year, the expenditures are charged to the allocation for the current award year. If the school carries back funds from the next year to the current year, the expenditures are charged to the next award year. Paying students from the correct award year is important; schools have been held liable when students were paid from the wrong FWS authorization. For audit and program review purposes, the school must have cancelled checks in its files to show that students received payment in the amount charged to the FWS Program. The school may use any type of payroll period it chooses, provided students are paid at least monthly. It is a good idea to have the FWS payroll correspond to other, similar payrolls at the school. PAYROLL RECORDS [[Separate FWS payroll]] For reporting and control purposes, FWS expenditures must be distinguishable from other institutional expenditures. FWS compensation should either be entered on a separate voucher or, if listed on the general payroll voucher, should be grouped separately from other expenditures. If payrolls are handled on automatic data processing equipment, a special code for FWS payments should be used. [[Voucher contents]] Payroll vouchers must support all payroll disbursements and should provide space for the following information: - school's name and address; - starting and ending dates of the payroll period; - student's name; - identification of the student's job; - number of hours worked during the pay period; - hourly rate of pay for undergraduate students; - hourly rate of pay or salary for graduate students; - gross earnings; - compensation withheld for federal, state, county, or city taxes, and other deductions; - noncash payments; - net earnings; - check number, duplicate receipt, or other payment identification; and - overtime earnings (a student may be paid overtime with FWS funds). |