Expert: Shirley McAllister, CPP, PHR - 1/13/2009

Question
QUESTION: Dear Shirley,

I am hoping that your response can settle what seems to be a hopeless disagreement regarding what I believe to be missing wages due to a mid year change in payroll 2008.
I don't know how much information you will need so I will try to be as specific as possible.

 I started with a company in September of 2007. I am paid a $76,000.00. yearly salary. This is in writing on a employment agreement.
 My employers payroll is set up biweekly to be paid on Fridays. My paycheck gross are $2923.08.(26 pay checks).
 My 1st payday in 2008 was 1/11/08. Payroll period 12/24-01/06. with the last pay check to be received on 12/26/08 equaling 26 paychecks for a total of $76,000.00.

 However, in April of 2008 my employer changed pay dates to match their parent companies system which was opposite weeks and pay period endings on Friday before paydays instead of Sundays.

 My last pay check on the old system was 04/18/08. I then received a check on 04/25/08 in the equivalent of 1/2 a pay period thus changing payroll to cycle on the same weeks as Parent Company this made my last paycheck for 2008 to be paid on 12/19. My gross accumulation for the calendar year was $74538.46, short by 1/2 a paycheck

I have sat down with my employer a few times and they have been very hospitable with one exception, they disagree with me and feel they owe me nothing more than what, and how I am currently paid. They keep wanting to count weeks and show me how they are all accounted for and paid on a actual pay period basis.

We agree that my checks are divided by 26
We agree my salary is $76000.00 ( I believe they are looking at my salary as a biweekly amount)How can I show them this is wrong.
I have shown them that in May I was to get 3 pay checks and because of the change of pay dates I only received 2; and the 1/2 paycheck on 04/25 that I received was not covering the loss of the 3rd check in May  thus my yearly Salary total for 2008 totaled 25.5 pay checks.

My employer feels they do not owe me this difference in pay. Their conclusion is; all pay periods are covered. I have even shown them that the difference is not made up in 2009, nor am I played 3 weeks in arrears.

I do not want to offend or file a complaint on my employer, I respect them and enjoy my job. I do not believe they are trying to deceive me.
I have tried with no success and am afraid of damaging relationships with people I really like and a job I appreciate.  
Can you help me?  Thank you.

Respectfully,
A. Winter



ANSWER: You both agree your salary is 76,000 a year.  When you receive your W-2 for 2008 ask them why the amount on your W-2 is not 76,000.00

Shirley

---------- FOLLOW-UP ----------

QUESTION: Thanks Shirley,
This is a small business and I have been talking to the husband and wife who sold the company and are currently part owners. The husband is currently the Regional Manager.
I know, as do they, that the last paycheck of the year does not hit the 76,000.00 salary. What is very obvious to you, as well as me is a problem for them. For some reason they keep standing on the premise that within the calendar of pay period start and end dates calculate to 76.
I can't seem to convince them there is a difference between a yearly salary 26 pay checks within calendar year compared to an hourly, weekly or biweekly employee.

Is there anything in writing to show the differences in how these are calculated for various pays. Is there anything/something that shows how changing one week can throw off salary pay and throw off accounting.

Thank you
Respectfully
A Winter

Answer
Anytime a change is made to the salary it can throw things off. It depends on the amounts of the checks.

If the pay is paid 24 times a year than the check gross would be 31666.66. If it is paid 26 times a year than the check gross would be 2923.07.  If the correct amounts are calculated than it could add up to the correct amount. If they are not there could be a discrepancy.

The amount paid for the whole year should add up to a gross of 76,000 on your W-2 form. If it does not than it is not correct. It cannot be paid in 2009 because than 2009 starts another year and another 76,000.00.

Don't talk to them about the number of paychecks or number of payperiods. Find out why the total for the year does not add up to the 76,000 which is your salary. It doesn't matter when the payperiods are paid as long as you are paid the 76,000 in one year. So for the year of 2008 your gross pay on all your paystubs regardless of paydays should add up to 76,000 and none of it should be paid in 2009.

Shirley