Lump-Sum Pay Basis Appointments

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Policy Number:
UW-5004
Old Policy Number:
1.05
Responsible Office:
Office of Human Resources

University Policy

Rationale/​Purpose:

This policy defines requirements to hire an employee on a lump sum basis.

Scope:

Faculty, Academic Staff, Limited Appointees, and Ad Hoc Program Specialists (employee class OT1) hired on a lump sum pay basis who do not concurrently hold a benefits-eligible position (eligible for either the Wisconsin Retirement System [WRS] benefit package or the Graduate Assistant/Short-Term Academic Staff benefit package) paid on an annual, academic, or hourly pay basis.

See UW-5003 Student Hourly Employees for information on lump sum appointments for student hourly employees.

This policy does not apply to lump sum payments awarded to active employees on their regular annual, academic, or hourly pay basis appointments.

This policy does not apply to graduate assistants, postdocs, or non-service appointments.

Policy:
  1. Lump sum appointments can be created if an individual cannot be paid on an hourly or an annual pay basis, or as an independent contractor. A lump sum appointment may be created without a recruitment. If the work being performed is nonexempt from overtime provisions of the Fair Labor Standards Act, the individual must be hired in compliance with UW-5022 Temporary Employees.
  2. When a lump sum appointment becomes necessary:
    1. An appropriate title must be assigned based on the duties performed
    2. Payment must be appropriate based on the salary minimum (and maximum, if applicable) of the title and the expected amount of work to be performed.
      1. The dollar amount assigned to the hourly rate must be determined using the Lump Sum Default Hourly Rate
      2. Salary & Fringe calculations are conducted in compliance with UW System Administrative Policy 230, Salary & Fringe Benefit Calculations
    3. The appointment letter and signed employment agreement must include:
      1. Amount of the lump sum
      2. Period of time the lump sum payment covers (i.e., earnings beginning and end dates)
  3. Affordable Care Act (ACA) Compliance
    1. Employees paid on a lump sum basis are not considered full-time for purposes of the Affordable Care Act (ACA) and must not exceed an average of 30 hours per week (The Universities of Wisconsin is considered a single employer; all hours worked in any UW–Madison unit or at any other Universities of Wisconsin institution is counted in the 30 hour per week).
    2. Appointments that unexpectedly exceed 30 hours per week must be converted to an annual (A) basis appointment with an established FTE or an hourly (H) pay basis appointment. Conversion may require a recruitment.
  4. Reporting Time
    1. Divisions must report hours worked by employees on a lump sum appointment monthly using:
      1. Actual hours
      2. Days-worked equivalency (each workday of service constitutes 8 hours credited)
    2. In compliance with Wis. Stat. §§ 40.22(2m) and 40.22(3), hours must be assigned to lump sum payments to determine Wisconsin Retirement System (WRS) creditable service.
Related UW-Madison Policies:
Related UW–Madison Documents, Web Pages, or Other Resources:

Title and Standard Job Description Library

External References:

Policy Administration

Approval Authority:
Vice Chancellor for Finance and Administration
Policy Manager:
Associate Vice Chancellor/Chief Human Resources Officer
Contact:
HR Director & Program Officer -- Alisha Arnold, alisha.arnold@wisc.edu, (608) 265-1451
Effective Date:
09-13-2016
Revised Dates:

04-05-2019, 04-29-2025

Reviewed Dates:

04-29-2025

Retrieved:
05-06-2025 19:07:41