Expert: Shirley McAllister, CPP, PHR - 9/13/2011

Question
Same question, but wanting more clarity. My husband's employer switched. According to a handout we got from the employer, instead of getting paid on Sept 2 which would have been the next 2 week cycle, they were getitng paid on Sept 9th for the period of Aug 1 - Aug 21. Prior to that (which is 15 work days)each pay check was 10 work days. After that period, beginning with the Sept 30th pay, each period is 11 days. He is salaried. His accountant says you just take his pay and now divide by 24. But my thing is....isn't there a period he wasn't paid for?

The check on the 9th is just that - his salary divided by 24, but what about the period? Can you just determine a day and say now we are 24? It seems as though there would be a lag, especially since we didn't get paid on the 2nd? So we went from an August 19 pay to a Sept 9 pay and just got a 1/24th pay? Is that right?? And our next pay is then Sept 30th.

Answer
The salaried employee is paid the same every month. So if he is paid 50,000 26 times a year he is paid 1923.08 per pay period.  If he is paid 50,000 per year 24 times a year he is paid 2083.34 per pay period. The extra amount covers the extra time on the pay period.

So what they should do is add up all the pay periods already paid. which would be 17 though the end of August. 17X 1923.08 is 32,692.36 subtract it from 50,000 for a sum of 17,307.64 than divide that by the remaining 8 pay periods left (Sept2)(Oct2) (Nov2) for a sum of 2163.46. This is the amount he should be paid for the remaining 8 pay periods. 32,692.36 plus 17,307.64 is equal to 50,000.00.

If the yearly amount is different than just use the formula but change the 50,000 to the amount paid per year.

Days and hours do not matter to a salaried exempt employee. What matters is that at the end of the year the total annual salary is paid.

Shirley