This policy applies to all state and self-supporting operations, except the separate campus 501(c)3 auxiliary organizations which include the University Center, Sponsored Programs Foundation, Advancement Foundation and Associated Students. The auxiliary organizations have their own governing boards which set policy for their organization.
This process applies to employees who have been required by the University to carry a wireless device so as to be available to the University while away from campus and/or to use a wireless device as an integral tool in performing their assigned duties. Examples of wireless communication devices are cell phones and personal digital assistants.
The decision of whether an employee is required to be available while away from campus and use a wireless device is decided by the President or Vice President, or his or her administrative designee. The administrator will complete a mandatory authorization form that provides specific information concerning the required usage. The form is titled, "Authorization for Business-Related Wireless Device."
Compliance with Tax Law
The IRS Tax Code characterizes wireless devices as “Listed Property” which imposes stringent, detailed recordkeeping requirements, particularly if there are components of business and personal use. Under the tax regulations, deductions for expenses attributable to the business use of wireless devices are disallowed unless it can be substantiated by adequate records. In addition, this substantiation rule does not permit an employer to adopt “de minimis” personal use policies; therefore, each monthly billing must be reviewed for personal use, reimbursed by the employee, and documents retained by the campus. If sufficient records are not kept, the value of the benefits must be included in the employee’s gross income and treated as wages for tax purposes.
If the employee owns the wireless device, the “Listed Property” requirements do not apply.
For those employees who have been assigned to carry a wireless device, the University offers several options. The decision regarding which option to use will be determined collaboratively between the employee and his or her administrator. However, if an agreement cannot be reached, the default will be the University-owned device (Option 1) which shall be issued on a shift-by-shift basis, and prohibits personal use.
Option One: University-owned Device
- The use of the device is for business use only. University-owned devices should not be used for personal reasons, as this may result in full taxation of the value of the wireless device/service and may result in cancellation of the service and return of the device.
- The employee and administrator will need to document the issuance of the asset, whether purchased by the university or donated to the university. The form is titled, "University-Owned Wireless Devices."
- Monthly statements will be reviewed by the employee’s administrator, who will forward an invoice-approving document to Accounts Payable. The form is titled, "University-Owned Wireless Devices."
Option Two: Personally-owned Device with Ongoing Usage
All wireless devices under this option are the personal property of the employee. Changes in service for personal use are the employee’s responsibility. In addition, the employee will retain the phone number if he or she separates from the University.
The expense allowance, which is a non-accountable plan, is reportable as taxable income on the employee’s W-2. Each employee retains the allowance payment and is not obligated to refund the allowance to the University if employee separates, changes job duties, or transfers to a new position.
- The University will provide expense allowances for/toward (a) acquisition of the initial device and (b) for/toward service fees. The amounts are determined by the administrator, from the "HSU Wireless Device-Plan Rates" schedule, based on his or her estimate of the amount of expected campus-required usage. The estimate is based upon past, comparable, and expected wireless usage for the employee’s position. The administrator may not use this expense allowance as a salary supplement. If the employee disagrees with the amount, he or she may propose an alternative allowance and discuss reasons with the administrator. The allowance amount may be adjusted or the administrator may requisition a University-owned device, as detailed in Option One. Reminder: Devices under Option One are for business purposes only.
- The University-paid allowance is used to defray the cost of the use of the wireless device for University business. The employee shall make available to the University, upon University request, records of the business calls necessary to comply with applicable law and regulations, including but not limited to, the California Public Records Act; however, the employee may redact any personal information from the records provided. The employee agrees to retain cell phone bills for thirty (30) days from the date of receipt of said bills by the employee.
- As long as the wireless service provider’s plan supports and is compatible with the use required by the University, the employee may choose the device and the service plan he or she wishes to use. The arrangement is between the employee and the wireless service provider; the University is not involved in the contract with the provider.
- Device: A biennial expense allowance toward the cost of acquiring the appropriate initial device will be paid to the employee.
- Monthly Service Charges: An annual expense allowance for/toward service fees will be paid to the employee.
- Renewal Cycle: By default, employee wireless allowances will be paid on an annual basis.
- Renewal Amount: The administrator and employee will review the basis for the allowance amount at each renewal period.
- Periodic adjustments: Employees may request a periodic adjustment of the expense allowance for reasons such as underestimated usage, change in job duties requiring greater usage, and/or administrator wants employee to increase features/access new technology.
Option Three: Personally-owned Device with Infrequent Usage
Wireless devices under this option are the personal property of the employee. The occasional use of personal wireless devices for work-related purposes is no different than the occasional use of other personal equipment (e.g. a land line at home). Business wireless expenses are considered infrequent and incidental. (Note: Ongoing assignments requiring wireless use for business should select Option 1 or 2.)
Consistent with long-standing reimbursement policies, if the occasional use has a cost and the employee is able to support that cost with the appropriate invoice documentation from the service provider, with department approval, the employee may submit a claim for reimbursement for that particular and specific use of the employee’s personal equipment. Employees will be reimbursed for the portion of the monthly plan related to business usage, plus they will be reimbursed for the actual cost of roaming, overage and other miscellaneous charges resulting from business usage.
Examples include media relations crisis support staff, temporary special event staff used for weekend events, and business related wireless calls made during business travel.
In order to request reimbursement:
- Use Accounts Payable’s "Petty Cash Reimbursement Request Form" located on the Financial Services website under “Forms” (reimbursements under $50).
- Calculate reimbursement: Determine the number of business minutes used as a ratio to total minutes used; apply that ratio to the total monthly invoice. Submit the pro-rated amount for business use. The actual costs directly related to business use will also be reimbursed.
- Use Contracts and Procurement’s "Direct Payment Request Form"located on the Contracts and Procurement website under “Forms” (reimbursements over $50).