HBP Part 13.2.2. Encumbered and Unencumbered Payments

Handbook of Business Procedures

Date published: June 3, 2011
Last revised: November 12, 2018
Issued by: Payroll Services


Salaries and wages paid through Payroll Services to employees of The University of Texas at Austin can be classified as either encumbered or unencumbered payments.

A. Encumbered Payments

Salaries of employees assigned to monthly positions are encumbered, meaning the funds in the account have been reserved and cannot be used for other purposes. Monthly allowances are also encumbered.

Annual encumbrances occur at the beginning of each fiscal year, September 1, and do not extend beyond the end of the fiscal year, August 31..

Adjustments to encumbrances occur on a nightly basis in accordance with approved employment and compensation business processes.

B. Unencumbered Payments

Unencumbered payments have not previously had funds reserved in the account and will be charged when the payroll has processed. Unencumbered payments include wages to hourly employees as well as one-time payments processed via compensation and other earnings that come from time tracking, such as overtime.



Part 13. Payroll Services - Table of Contents