Award programs, including those which are locally funded, may be utilized provided they adhere to an approved competitive process and all applicable federal and state laws.
Awarding Departments are responsible for tracking such awards, maintaining the appropriate documentation, and communicating with University Payroll at email@example.com concerning distribution. Cash awards must now be processed through University Payroll rather than Procurement and Business Services. Additional information is included on this page.
I. Policy Statement
Auburn University (“the University”) promotes programs that recognize and encourage the dedication, support, and participation of employees and non-employees in carrying out the University’s mission. Award programs may be utilized provided they adhere to an approved competitive process and all applicable federal and state laws.
II. Policy Procedures
Departments are permitted to develop programs that recognize extraordinary work performance and enhance employee morale by motivating employee initiative and excellence. Employee award programs must be preapproved by the University Employee Awards Committee and follow the guidelines listed in the Employee Awards Guideline Procedures.
Award Programs will be reviewed by the Employee Awards Committee utilizing a three-year review cycle. However, substantial revisions to an originally pre-approved program will require immediate resubmission for review.
Awards are prohibited from being used as adjustment to base salary, supplemental compensation, increased value of a position, or internal pay equity.
A. General Requirements
Awards must have a valid, documented business purpose, and comply with all University purchasing and expense procedures. The presentation of an award must demonstrate that the award benefits the University, is in furtherance of the University’s business purpose, or is clearly necessary to the University’s fulfillment of its role in the community. Awards must be administered through an approved and defined program that includes:
1) Identified program objectives
2) Defined award themes and selection criteria
3) Defined recognized program selection committee
4) Defined award eligibility, award frequency, and award types
5) Defined award nomination and selection process
1) Cash Awards: University-funded cash awards to employees constitute gross wages and are subject to payroll tax withholding, regardless of amount. Cash equivalent awards (gift cards, gift certificates, gift vouchers) are not permitted.
2) Non-Cash Awards: Awards that are tangible personal property.
a. Non-De-Minimis: Tangible property given infrequently with an annual value of more than $100; these awards are subject to taxation and the full value amount must be sent to payroll for tax withholding.
b. De-Minimis: Tangible property given infrequently with an annual value of $100 or less.
3) Time-Off Awards: Awards are limited to no more than eight (8) hours per award, not to exceed sixteen (16) hours per calendar year to the same recipient. This award is required to be used within 90 days of receipt and is forfeited at time of departure from the University. Employees who do not earn vacation leave will not be eligible to receive a Time-Off Award.
C. Awarding Departments are responsible for tracking such awards, maintaining the appropriate documentation and communicating with University Payroll concerning distribution. Departments must track the value of all non-cash awards presented to employees and provide a list annually to University Payroll.
D. Awards to non-Auburn employees will be awarded in accordance with University Spending Policies and Procedures. More information
E. Awards to Students: All students awards shall adhere to guidance found on Student Financial Services webpage. More information
F. Exceptions for Length-of-Service: Non-cash length-of-service awards may qualify as a non-taxable benefit provided federal guidelines are met. University Human Resources is responsible for Employee Service Awards presented annually and the Spirit of Excellence Awards awarded monthly.
III. Effective Date
February 1, 2018
These policies and procedures are applicable to all University employees.
V. Policy Management
Responsible Office: Human Resources
Responsible Executive: Associate Vice President, Human Resources
Responsible Officer: Associate Vice President, Human Resources
A. Employee: For purposes of this policy, an employee is anyone who receives a Form W-2 from the University.
B. Awards: Under IRS income category, “other income” generally, an amount received in recognition of charitable, scientific, educational, artistic, literary, or civic achievement. Awards are generally taxable income to the recipient. The University will process only awards given through a pre-approved competitive program.
C. Tangible Personal Property: Items that can be moved, touched or felt. (Such as plaques, pens, t-shirts, trophies, etc.)
D. Infrequently: For purposes of this policy, an employee may not be awarded a tangible departmental award more than twice in a calendar year.
VII. Policy Procedures
Details of how to make the policy work
Violations of this policy will be addressed through appropriate disciplinary action.
There are no exclusions to this policy.
Associate Vice President, Human Resources
Corresponding Policy Title: Policy on Employee Awards
Procedure Owner: Human Resources
Effective: May 1, 2018
Last Updated: May 2018
Responsible University Department: Human Resources
Procedure Contact: Executive Director, Payroll, Benefits and Records
I. Procedure Statement
The Employee Award Guideline Procedures are provided to ensure consistency and fairness throughout all university award programs and to guide Auburn University departments and units with the development and implementation of award programs. These guidelines are provided as a tool to assist departments and units with their recognition efforts and do not imply that each department or unit must have an awards program.
A. Guiding Principles
Awards must be given through a competitive program that promotes the best interest of Auburn University (“the University”) and the purpose for which the University was created (must have a business purpose or of primary benefit to the University and its mission).
All proposed employee award programs must be submitted to the University Employee Awards Committee for review. Approval from this Committee is required prior to any award distribution. Award Programs shall be submitted to the Chair of the Committee.
All award funding is provided through the local budget. Departments are responsible for funding and continuation of award programs. If funding is no longer available for award programs, a statement of withdrawal must be sent to the Awards Committee, as well as, a notice sent to all department employees.
These procedures apply to student awards only when the award is based on the student’s employment with the University.
B. How to Provide Employee Awards
Step 1: Establish an Awards Recognition Development Committee
The Awards Development Committee will guide program design. The development committee must determine the components of the recognition program. The committee role is to identify, develop, and implement recognition program(s) for their department.
Although not required, it is best practice for the Development Committee to create terms and convene a Selection Committee: The Development Committee should make a determination of how Selection Committee members are chosen to serve, the length of service terms for serving, and training needs to be established.
Step 2: Identify Award Program Objectives
The Development Committee will need to identify recognition program objectives for their department to provide opportunities for the employee to be recognized. There are many factors to consider when identifying these objectives for your department. Here are some important factors to consider in this process:
The recognition program should meet the needs of the employees in the department or complement the kind(s) of job behaviors and performance the department wants to recognize and reward.
The program should be linked to the mission statement or core values of the department, division or the university.
The program should be fair and flexible to the employees in the department.
The recognition program should comply with university rules and regulations regarding award and incentive programs, taxation of payments and awards to employees or any other rules and regulations related to awards.
Review other university award programs.
To assist with this process, gather input from the employees in the department. This can be done by developing an employee survey to identify work behaviors and job performances to recognize and reward, identify employee eligibility criteria and award criteria.
Step 3: Identify Award Themes and Award Selection Criteria
The Development Committee must identify award themes for the award program that complement the employees and the department. This will help identify the selection process of the awards and help employees work towards setting goals so that they can be recognized.
Example award themes include:
Keys to Excellence Award
Exemplary Performance Award
Department Employee of the Year
Outstanding Employee Award
Employee Safety Award
Superior Customer Service Award
After an award theme has been identified, the committee will need to identify selection criteria. The selection criteria may be linked to a department's mission or core values or positive behaviors. To assist with this process, create an employee survey to find out what characteristics the employees value and think an employee should exhibit for nomination and to receive an award. Also, seek input from management on the types of behaviors they want to be recognized. Here are some examples of selection criteria:
Step 4: Identify Award Eligibility Criteria, Award Frequency and Award Types
The Development Committee will need to identify funding, determine award eligibility, award frequency and award selection processes. The committee will need to determine who is eligible to participate and/or be nominated for an award. They will also need to make sure that the award eligibility criteria complement the work environment of the department. Components of award eligibility criteria to consider are:
Length of service: is there a minimum length of service an employee must have with the department or University?
How frequently can an employee win an award?
Would Development or Selection committee members be eligible to participate in or receive nominations for an award during their term?
After award eligibility criteria are identified, the frequency of awards will need to be determined. There are some factors to consider when determining the frequency of awards for a department such as:
Are department funds available to cover the cost of multiple awards?
Are there too few employees in the department to participate in the program?
Are there other recognition programs in the department?
Will awarding many employees devalue the award itself?
After you have identified the frequency of awards, you will need to determine the types of awards. The awards selected for a recognition program should be meaningful and relevant to the award recipient(s). The awards given to employees can range from an award certificate to cash (paid through university payroll).
Step 5: Identify Nomination and Selection Process
The Development Committee or the Selection Committee will be responsible for carrying out the nomination and selection processes of a formal award program. The committee should determine the following factors about the nomination process:
Is the nomination process confidential? Should nominators be known or remain anonymous?
Which employees are eligible to submit a nomination?
What employee information should be provided on the nomination?
How should the nominations be submitted? (electronic, paper, etc.)
If the awarding Department/Unit convenes a Selection Committee, the Development Committee will need to determine the following items for the selection process:
Defining rating procedures and processes
Determine who will review and score the nominations
Determine the length of membership for the selection committee
Determine who will make the final decision on the winning nominations
Determine if past recipients should serve on the selection committee
Determine if selection subcommittee is eligible for nomination
Step 6: Identify Communication Plan
Public announcements should be made prior to the award program to announce the award program, after the award program and immediately following the recognition of the award recipients to recognize the employees. Here are some examples of how to market your department's award program:
Award program flyers
Email to department employees
SharePoint intranet site
Department bulletin boards
Step 7: Establish and Monitor Award Program
A departmental recognition program should be monitored and evaluated on a regular basis to assess its effectiveness and to obtain feedback and suggestions from employees for enhancements to the program. All substantial changes to the program must be approved by the University Awards Committee in advance of implementation.
C. Procedures for Issuing Awards
Obtain appropriate approval from awarding Department/Unit Awards Committee to issue specific award.
Ensure appropriate unit or department approval if applicable.
Notify award recipient of possible tax implications prior to presentation of award.
For an Award of tangible property:
Follow established University Spending Policies and Procedures for non-employee awards.
Maintain a list of awards, value, and recipients for submission annually to University Payroll for processing.
Cash awards: An Electronic Personnel Action Form (EPAF) with all appropriate information must be completed and sent to the Human Resource Records unit for processing. The employee’s position number with a suffix of A1 should be used and an earn code of AWD. Once received cash award payments will be processed on the next scheduled pay day for the recipient.
Terminated employees: If employee has received a tangible award then the award purchase price should be reported to University payroll with documentation for the last paycheck. An email with the employee’s name, banner id and amount of award should be submitted to the awards and incentive email address.
D. Record Keeping
Each department or unit is responsible for documenting all award recipients and award types. This report should include employee’s name, banner id and purchase amount of award. This documentation should be sent annually, no later than December 1, to University Payroll for review. This documentation must be sent to the following email address: firstname.lastname@example.org
Resources used for Development of this document:
The University of North Carolina at Chapel Hill. Employee Recognition Handbook
Texas A&M University. Employee Recognition Program Guidelines
Strict adherence to policy procedures is mandatory in order for Awards to be accessible.
VI. Related Information
Internal Revenue Code
The Code of Alabama
Policy on Payment of Awards
VIII. Frequently Asked Questions
The previous policy did not allow for the utilization of University funds for non-faculty awards or have an approval process attached. In response to campus requests, this policy provides a systematic approach in which departments/units can utilize local funds to recognize and encourage employees in carrying out the University’s mission with excellence. Payments will be made through University Payroll. In addition, all employee awards must be pre-approved by the Awards Committee prior to award distribution in fiscal year 2019.
Yes, if the awards program has been pre-approved by the awards committee to ensure the award program is related to a business purpose of the University and adheres to a competitive process, then University funds may be utilized, with the understanding of maintaining compliance with all other federal and state law as well as other university policies.
Yes. Cash awards to employees constitute gross wages and are subject to payroll tax withholding, regardless of amount. Additionally, tangible property (items that can be moved, touched or felt) such as plaques, pens, t-shirts) with an annual value of more than $100 are subject to taxation and the full value amount must be sent to payroll for tax withholding.
Yes, Time-Off Awards are limited to no more than eight (8) hours per award, not to exceed sixteen (16) hours per calendar year to the same recipient. This award is required to be used within 90 days of receipt and is forfeited at time of departure from the University. Employees who do not earn vacation leave will not be eligible to receive a Time-Off Award.
Auburn University promotes programs that recognize extraordinary work performance and enhance employee morale by motivating employee initiative and excellence.
The Employee Award Plan Committee (hereinafter referred to as “the Committee”) was established to ensure consistent award programs that adhere to university policy, as well as, federal and state law. This Committee will approve employee recognition and award programs and review existing programs every three years or as appropriate.
Committee members shall confirm that all submitted employee award and incentive programs are consistent with the guidelines established in the Employee Award Guideline Procedures.
The Committee shall respond in writing to department or unit with an approval letter or recommendations for compliance and resubmission.
Members of the committee shall be representatives of the following areas and are designated by virtue of their expertise and functioning role at the University.
Payment and Procurement Services
University Payroll (Committee Chair)
Student Financial Services
The Committee shall hold regular meetings at least three times annually. Advance written notification to all campus stakeholders of submission timelines and meeting dates shall be communicated annually.
These bylaws may be amended at a regular meeting, provided all committee members are present.