You are here:

Employment Law/Pay cycle changes

Advertisement


Question
My employer in Tennessee is planning to change our pay frequency from semi-monthly to bi-weekly. I do not have any concerns with this change in general.

However, while making this change, they will be changing from a pay-current system to a more traditional method. For example, the paycheck that I receive at the end of the month will include payment for time worked on the last day of the month. With the new system, my paycheck will will cover a work period that ended one week prior to the date of the check. My concern is that I believe that this change would make my annual pay short by one-week salary. Is the company obligated to cover this missing week, or do I need to plan on taking a loss in pay of one week that will not be recovered until my employment ends with this company?

This change would also affect employees in Georgia, Indiana, and Mississippi.

Answer
If you are hourly than you will recoup the week when your employment with the company ends. This is typical in our company we hold back the first week of pay.

If you are salaried exempt and they figure it correctly you will not lose pay. Since you get the same pay each pay period throughout the year. They simply have to figure your annual wage , subtract the pay periods already paid and divide the balance by the remaining pay periods and all will be well at the end of the year.

This for example if you earn 50,000 a year. Under the current system you would have 24 payperiods throughout the year. Your 50,000 is split into 24 equal payments of 2083.33. Now if your bi weekly starts September 1, 2014. this is how it should be figured.

Amount paid for 2014 pay periods up to August 31st.  Subtract from 50,000. Balance is divided by remaining pay periods in the year.

That would only be for salaried exempt employees. Hourly employees are paid by the hours worked.

Shirley

Employment Law

All Answers


Answers by Expert:


Ask Experts

Volunteer


Shirley McAllister, CPP, PHR

Expertise

I can answer questions about payroll laws and payroll tax laws and Human Resource laws and agencies. I can answer federal payroll and human resource law questions and most states; I do not have a knowledge of the local taxes for cities and counties within the state. If and when I can I will try and send you the website where you can reference the answer and where you can obtain more information as well as a contact number if needed for that particular agency. Some agencies I have worked with are IRS, Department of Labor (federal and state), Revenue Canada (and provincial governments), Inland Revenue, OSHA (0ccupational Safety and Health Administration); Social Security Administration and National Child Support as well as other agencies in Payroll and Human Resources. Some Laws I am particularly familiar with are FLSA (Fair Labor Standards Act), ADA (Americans With Disabilities Act), FMLA (Family Medical Leave Act) COBRA (Consolidated Omnibus Reconciliation Act ) , QDRO's, QMCSO's, and other support orders and garnishments, USERRA (Uniformed Services Employment and Remployment Rights Act,PPA Act (Pension Protection Act of 2006, As well as most other employment type acts. I am also well versed in the Title V Civil Rights Act and the HIPAA (Health Insurance Portability and Accountability Act).

Experience

30 years in Payroll and Human Resources

Organizations
SHRM (Society of Human Resources) APA (American Payroll Association) DOLEA (Department of Labor Employers Association) CPA (Canadian Payroll Association) NAPW (National Association of Professional Women) The Mentoring Network

Education/Credentials
PHR Certification in Human Resources CPP Certification in Payroll in U.S. Payroll Administrator and Payroll Supervisor certification in Canada

©2016 About.com. All rights reserved.