Audit Objective 

Determine whether City of Middletown (City) officials accurately paid employees’ salaries, wages and benefits and properly accrued leave benefits. 

Key Findings 

City officials did not accurately pay employees’ salaries, wages and benefits, or properly accrue leave benefits. We reviewed payments and benefits totaling $1.9 million and found exceptions totaling $292,205, including potential overpayments totaling $191,253. As a result, the City paid employees for time they did not work or accrue. For example, 

• Two sewer treatment plant (STP) employees received $91,492 for time they may not have worked because they were working at another municipality.
• City officials made $99,761 in vacation buyout payments that were not in accordance with City collective bargaining agreements (CBAs). 

Key Recommendations 

• Ensure employees worked the hours that they were scheduled to work and were paid for working.
• Establish City-wide payroll processing policies and written procedures that address the audit deficiencies. 

City officials disagreed with certain aspects of our findings but indicated they have initiated or plan to initiate corrective action. Appendix B includes our comments on issues raised in the City’s response letter.