5 Jan 2026

Important: Recording Compensatory Time

A message from UMS Payroll Operations

Dear Colleagues,

We are writing to inform you about important changes in how compensatory time must be recorded starting January 1, 2026. The changes are necessary to accurately report qualified compensation under the “No Tax on Overtime” provision in the “One Big Beautiful Bill Act” (OBBBA) which allows eligible employees to claim a deduction for certain overtime earnings including paid compensatory time. Please read on to understand what this means for you.

Who is impacted by this

  • Hourly (non-exempt) employees who earn compensatory time.
  • Time Approvers, supervisors, managers who approve and/or manage compensatory time

What is changing effective Jan. 1, 2026

All compensatory time earned must be recorded as hours actually worked using one of the following applicable codes:

  • CMOT – Comp time earned-overtime must be used to record overtime hours actually worked as compensatory time. The balance will be updated by 1.5 times the hours entered.
  • CM_SV – Comp time earned-AdmLv,Holiday must be used to record compensatory time as straight time for hours worked during Admin Leave, Admin Holiday, or Regular Holiday.
  • CM_15 – Comp time earned-FamHoliday must be used to record the number of hours actually worked as compensatory time for working on a Family Holiday. The balance will be updated by 1.5 times the hours entered.
  • CM_X2 – Comp time earned-AdmLv x2 must be used to record hours actually worked as compensatory time for working outside of the normal schedule during Administrative Leave. The balance will be updated by 2 times the hours entered.

Additional Resources & FAQ

Thank you for your attention to this important update, and for your continued service to the University of Maine System.

Regards,

April Strowbridge
Director of Payroll Operations
University of Maine System
payroll@maine.edu