Inside Clemson:

CELL PHONES: CU adopts new policy for official cell phones, PDAs

Personal Communication Services Policy
 
Clemson University is complying with IRS regulations regarding business versus personal use of cell phones by eliminating most department-paid cell phones and personal digital assistants (PDAs).

With a new Personal Communication Services Policy, due to take effect Jan. 1, 2009, Clemson is following suit with colleges and universities throughout the country by offering a taxable allowance for communication services, such as cell phones, home Internet service and BlackBerrys.

This action was prompted by a recent crackdown that has resulted in huge bills for back taxes for many large employers, including the University of California system.

“Basically, most institutions have been in violation of a federal law,” said Lawrence Nichols, chief human resources officer. “This policy is the university’s response to the issue of non-compliance.”

In a July 28 story, the Los Angeles Times explained that the “problem stems from the tax code’s inability to keep up with technological advances.” The Internal Revenue Service “still considers cell phones to be a pricey fringe benefit and has started enforcing regulations” created in 1989 “when Congress decided that mobile phones should be treated like company cars and other executive perks” instead of like the common business tools they have become.

As a result of this law, companies were required to keep detailed records of all calls made on employer-issued cell phones, indicating whether they were business or personal. Without this recordkeeping, the cell phones and other wireless services are considered perks and must be treated as taxable income to the employee.

“We would have to hire additional staff to handle this tremendous increase in recordkeeping,” said Nichols.
Instead, Clemson has adopted a policy that will comply with the law while still paying for these services.
 
How does the policy work?

Employees whose duties and responsibilities require them to maintain contact with the university while away from the office or to be accessible outside normal working hours will be eligible to apply for compensation in the form of a monthly communications allowance (or stipend) to pay for this cell phone service.

Those whose job duties require continual Internet access outside normal working hours may receive a monthly stipend for this service.

Some employees may be eligible for more than one type of allowance, for instance, a cell phone and Internet service.
Employees who receive allowances will be responsible for purchasing and maintaining the necessary phone or other devices for wireless and/or Internet service.

Clemson owns all cellular devices paid for by the university for official use. Employees who are authorized to receive a stipend may keep the cell phones and PDAs they currently use and convert the accounts to personal plans. These devices must be returned to the university for disposal when the employee is no longer approved for the stipend or chooses to upgrade to a new device.

All major providers currently servicing university departments have set up simplified processes for converting these existing accounts.
 
Who will be eligible for the allowance?

Vice presidents, deans, directors or others they designate to make these decisions will determine who will receive compensation for these services. Simple convenience is not a determining factor. An allowance may be authorized if an employee meets at least one of the following three criteria:

The job function of the employee requires considerable time outside of the assigned office or work areas and it is important to the university that they are accessible during those times.
The job function of the employee requires them to be accessible outside of scheduled or normal working hours.
The job function requires continual interest access outside of normal working hours.
 
Are there exceptions to this policy?

Clemson athletic departmental employees are exempt since their cell phones are provided through a sponsorship arrangement.
Facilities employees are exempt based on the unique bundling agreement that covers the cell phones and push-to-talk devices they use.

Phones that are shared by multiple employees while on duty and turned in at the end of a shift are exempt.
Also, certain other departmental cell phones as defined in the policy may be exempt.
 
How much will I receive as an allowance?

Allowances will be based on how much management anticipates each employee will use a cell phone for business-related purposes.
According to a tier system:

Tier 1 — $13/month for employees with limited use (100 minutes or less)
Tier 2 — $42/month for employees with light use (100-450 minutes)
Tier 3 — $62/month for employees with medium use (over 450 minutes)
Data Tier — $58/month for employees who are required to have Blackberry or other data device for checking e-mail on a wireless basis
Internet Tier — $32/month for employees whose jobs require Internet access at home

Allowances will be paid through the normal payroll process and will be subject to all applicable taxes; however, the stipend will not increase your base salary.

“The allowances set by Clemson should be generous enough to cover business-related use plus the tax liability for employees,” said Nichols.

The tier allowances will be reviewed annually by Clemson’s procurement office and CCIT to ensure they are consistent with local pricing.
 
Will the university have access to my bills and call records?

These will be personal accounts for which employees will be responsible. Bills will come to the individuals for payment. However, in the event of an official investigation, a Freedom of Information Act request or a subpoena, individual employees may be required to turn over their phones, Blackberries and bills/call records to law enforcement officials or university general counsel.

How do I convert my department-paid service to a personal account?

Help with making the transition from university-paid service to a personal account will be available Tuesday morning (Oct. 7) on the procurement services Web site at: http://www.clemson.edu/procurement/wireless.htm

Where can I read the policy?

The complete text of the Personal Communication Services Policy soon will be available on the human resources Web site at:
http://www.clemson.edu/cao/humanresources/professionals/index.html

Submit other questions you may have to Inside@clemson.edu and Inside Clemson will publish the answers.