101 KAR 2:120. Incentive programs.
RELATES TO: KRS 18A.202, 199.555(1)
STATUTORY AUTHORITY: KRS 18A.030(2),
NECESSITY, FUNCTION, AND CONFORMITY: KRS
18A.110(1)(d) requires the Secretary of Personnel to promulgate administrative
regulations to implement work-related incentive programs for state employees.
KRS 18A.202 authorizes the secretary to establish work-related incentive
programs for state employees. This administrative regulation establishes the
requirements for an employee suggestion system incentive program and a state employee
adoption benefit program.
Section 1. Employee Suggestion System.
(1) Administration. An employee with status in the classified service or an
employee governed by KRS Chapter 16 may be recognized and rewarded for
submitting a suggestion that results in the improvement of state service or in
the realization of financial savings by the state.
(a)1. The employee suggestion system
council, headed by the chairperson designated by the Secretary of Personnel,
a. Ensure proper evaluation of each
b. Review and act upon, by approval or
denial, a suggestion presented to the council by a cabinet or agency; and
c. Reconsider denials as set forth in
subsection (4) of this section.
2. A designated coordinator may present
recommended suggestions to the council and request that the council vote on
3. The council may defer action for up to
one (1) year and one (1) month pending documentation of cash savings.
4. The council shall receive
administrative support from the Personnel Cabinet.
5. The council shall prepare an annual
report to be submitted to the Secretary of Personnel that shall include the
number of suggestions received and the status of each suggestion.
6. The council shall meet:
a. At a minimum on a quarterly basis; or
b. Upon the request of the council
chairperson or a majority of the coordinators.
(b) Each cabinet secretary or agency head
shall designate, in writing, the appointment of a coordinator who shall also
serve on the council. The coordinator shall receive suggestions and establish
and maintain internal procedures to ensure appropriate evaluation of
(c) The coordinator shall present
suggestions recommended for approval by the cabinet or agency to the council
(a) A suggestion shall be a positive idea
1. Explains how to improve methods,
equipment or procedures;
2. Reduces time or cost of a work
3. Creates a safer work environment;
4. Increases revenue; or
5. Improves relationships with or
services for the public.
(b) The suggestion shall:
1. Present an improvement in state
service or function;
2. Explain how the change would be
3. Define what benefits would be realized
by the state, particularly in terms of efficiency, effectiveness, safety,
economy, conservation of energy resources, or public relations;
4.a. Be made by an employee to the
employee’s cabinet or agency; or
b. Be forwarded from other coordinators
if the suggestion affects the coordinator’s agency;
5. Within ninety (90) working days of
implementation by the agency, be:
a. Submitted on the Employee Suggestion
Form, P-35; and
b. Accompanied by exhibits or
illustrations as needed;
6. Be practical, useful, and
7. Be eligible for an award only after
legislative action or administrative regulation changes, if required, have been
completed which shall be the responsibility of the agency that desires to
implement the suggestion.
(c) The following suggestions shall not
be eligible for a cash award:
1. A suggestion that falls within the
scope of the duties of the suggester and which the suggester has the authority
to initiate or implement without other administrative approval. "Scope of
duties" shall include a specific set of tasks as set forth in the position
description of the suggester upon submission of the suggestion;
2. A suggestion related to a particular
problem given to an employee to solve within the scope of the employee’s duties
3. A suggestion made by a member of the
council, a cabinet, or agency suggestion review committee;
4. A suggestion which includes a proposal
to perform routine maintenance operations or follow manufacturer's
5. A suggestion to make a change which
has been documented in writing as already under consideration by those
administratively responsible; or
6. A suggestion which corrects an error
or condition that exists because established procedures were not followed.
(d) If more than one (1) suggester makes
significant contributions to the idea, the suggestion may be submitted jointly,
and an award granted shall be divided equally between or among the suggesters.
(e)1. The first suggestion received shall
take precedence over all future suggestions having the same purpose.
2. If two (2) or more similar suggestions
are received on the same day, an award granted shall be divided equally between
or among the suggesters.
(f) A suggestion shall be considered a
confidential communication among the suggesters and the employees and officers
whose responsibility it is to process, investigate, review, or evaluate suggestions.
(3) General provisions.
(a) The cabinet or agency head shall
establish an internal system for receipt, evaluation, and reconsideration of
employee suggestions. This system shall, at a minimum, include the following:
1. A method to notify the suggester in
writing that the suggestion has been received and to notify the suggester in
writing of a change in the status of the suggestion;
2. A method to document the original
suggestion, evaluation, and action taken; and
3. A method to prepare and present
documentation of a suggestion for recommendation to the council.
(b)1. Eligibility of a suggestion shall
be evaluated according to the circumstances existing upon submission of the
2. An evaluation shall be completed by a
person with expertise in the area under consideration.
3. The results of the evaluation shall be
recorded on the Evaluation of Employee Suggestion Form, Form P-36, and the form
shall be dated and signed by the individual making the evaluation.
(c)1. The suggester shall be notified in
writing of the disposition of the suggestion within ninety-five (95) calendar
days of receipt by the coordinator.
2. If all parties involved agree, an
extension of time shall be granted if extenuating circumstances exist.
3. A suggestion shall be considered to be
active and eligible for an award until the suggester is notified in writing
that the suggestion has been approved or denied.
4. If a suggestion will not be
implemented, the coordinator shall notify the suggester in writing stating the
reason it was not implemented.
5.a. If an eligible suggestion is not
adopted and conditions under which it was originally considered have changed,
the suggester may request reevaluation by the cabinet or agency.
b. The request shall:
(i) Be in writing;
(ii) Be evaluated by the next level of
(iii) Be received by the agency within
one (1) year from the date of rejection; and
(iv) Include information regarding the
change in conditions.
(d) If a suggestion is approved and
implemented by the cabinet or agency, the suggester's coordinator shall
recommend approval of the suggestion to the council.
1. The recommendation shall contain:
a. The suggestion as completed by the
suggester on the Employee Suggestion Form, P-35;
b. The evaluation forms completed
according to the criteria set forth in this administrative regulation; and
c. A statement of actual or projected
cost savings using generally accepted accounting principles.
2. Upon receipt of the council's
decision, the chairperson of the council shall send written notification of the
council's action to the suggester's coordinator and the coordinator shall then
provide written notification to the suggester regarding the decision.
3. If an eligible suggestion is denied by
the council, the suggestion shall remain on active file with the council for a
period of one (1) year from the date of denial.
(e) Award of cash payment shall be in
accordance with KRS 18A.202.
1. The cash payment shall be calculated
based upon the amount saved over the period of one (1) year minus
implementation costs and shall be determined according to generally accepted accounting
2.a. The award check shall be issued by
the agency where the suggester is employed.
b. Funds for payment shall come from the
agency or agencies implementing the suggestion.
c. If applicable the agency issuing the
check may interaccount other agencies implementing the suggestion for a
proportionate share of the total award amount.
3.a. If a suggestion may result in
financial savings to the state and proper documentation of cost savings has not
yet been obtained, the council shall request that each agency implementing the
suggestion maintain records which document the cost savings for a period not to
exceed one (1) year from the date of implementation.
b. Documentation shall be conducted
according to generally accepted accounting principles.
c. This cost savings analysis shall be
forwarded by the coordinator to the council chairperson within thirty (30) work
days of completion of the analysis.
(f)1. If a suggestion has been approved
by the council and has resulted in a financial savings to the state, the
suggester shall be compensated in an amount of ten (10) percent of the amount
saved over one (1) calendar year, with a minimum of $100 and a maximum of
2. If a suggestion approved by the
council results in an intangible improvement in state service, the suggester
shall be compensated in the amount of $100.
3. Upon the suggester's receipt of
compensation, the suggestion shall become the property of the state.
(a) A suggester may request
reconsideration of a suggestion that has not received approval from the cabinet
or agency within ten (10) work days of the date that written notice of denial
is received by the suggester.
(b)1. The suggester shall request
reconsideration in writing and shall set forth the basis for the request.
2.a. The request shall be filed with the
coordinator within ten (10) days of the date of the denial.
b. If the tenth day falls on a day that
the cabinet or agency office is closed during regular work hours, the request
may be filed on the next work day.
(c) Within thirty (30) work days, the
cabinet or agency shall act on the request for reconsideration and notify the
suggester in writing of the reason for the decision.
(5) Council review.
(a)1. A suggestion may be reviewed by the
council on its own motion, or upon request of the suggester.
2. If a suggestion has been reconsidered
and denied by the cabinet or agency, the suggester may request a review by the
a. The suggester shall request review
within thirty (30) days of receipt of the written notification of the outcome
of the reconsideration and shall set forth in writing the basis for the
b.(i) The request shall be filed in the
office of the employee suggestion system chairperson within the thirty (30) day
(ii) If the 30th day falls on a day that
the chairperson's office is closed during regular work hours, the request may
be filed on the next work day.
(b) The council shall complete the review
within ninety (90) calendar days of the date that the chairperson receives the
request for review.
(c) The council chairperson shall notify
the agency head of the council's findings and its recommendation concerning the
suggestion's implementation or denial.
Section 2. Adoption Benefit Program. (1)
A state employee who finalizes a legal adoption procedure for the adoption of a
child, other than the child of a spouse, on or after November 1, 1998, shall be
eligible to receive reimbursement for actual costs associated with the adoption
of a special needs child, as defined by KRS 199.555(1), or any other child.
Total state funds for this program shall not exceed $150,000 in a fiscal year.
(2) The eligible employee shall receive:
(a) Up to $5,000 in unreimbursed direct
costs related to the adoption of a special needs child; or
(b) Up to $3,000 in unreimbursed direct
costs related to the adoption of any other child.
(3) Unreimbursed direct costs related to
the adoption of a special needs child or other child shall include:
(a) Licensed adoption agency fees;
(b) Legal fees;
(c) Medical costs;
(d) Court costs; and
(e) Other fees or costs associated with
child adoption in accordance with state and federal law and after review and
approval by the court at the finalization of the adoption.
(4) Application for financial assistance
shall be made by submitting a completed State Employee Adoption Assistance
Application to the Secretary of Personnel along with documentary evidence of:
(a) Finalization of the adoption;
(b) Certification by the Secretary of the
Cabinet for Health and Family Services that the adopted child is a special
needs child, if reimbursement for special needs adoption is sought; and
(c) A copy of an affidavit of expenses
related to the adoption filed with and approved by the court at the finalization
of the adoption.
(5) If both adoptive parents are
executive branch state employees, the application for financial assistance
shall be made jointly and the amount of reimbursement shall be limited to that
specified in subsection (2) of this section.
(6) Upon approval of the application for
financial assistance, the employee’s agency shall dispense funds in the amount
authorized by the Secretary of Personnel.
Section 3. Incorporation by Reference.
(1) The following material is incorporated by reference:
(a) "Employee Suggestion Form",
P-35, October 2007;
(b) "Evaluation of Employee
Suggestion Form" Form, P-36, February 2010; and
(c) "State Employee Adoption
Assistance Application", May 2015.
(2) This material may be inspected,
copied, or obtained, subject to applicable copyright law, at the Personnel
Cabinet, 501 High Street, 3rd Floor, Frankfort, Kentucky 40601, Monday through
Friday, 8 a.m. to 4:30 p.m. (13
Ky.R. 430; eff. 9-4-1986; Am. 15 Ky.R. 830; eff. 10-12-1988; 26 Ky.R. 101; 573;
eff. 8-25-1999; 34 Ky.R. 614; 964; eff. 12-7-2007; 36 Ky.R. 1516; 2038-M; eff.
4-2-2010; 42 Ky.R. 88; eff. 10-2-2015.)