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26 pays in a 27 payroll year Indiana

On Lawyer & Legal » Employment & Labor Law

2,744 words with 4 Comments; publish: Fri, 22 May 2009 05:21:00 GMT; (800109.38, « »)

I work for a public school district in Indiana and received an interesting letter with my paycheck this week. I have a contracted salary that has traditionally been split over 26 pays. This year, due to payroll creep, there would be a 27th pay period. Instead of realizing this in advance and scheduling an additional paycheck (and reducing the other 26 paychecks a fraction to make up for the 27th), we were told that our payroll will run on a 14 day, 19 day, and 16 day interval - effectively eliminating this 27th paycheck. The pay amount of these oddly staggered checks will not differ, we just have to make our paychecks float longer. We are essentially losing a weeks work of pay due to how the calendar falls - even though our contracted salary amount is paid out correctly, there are more days in the affected pay periods that we are not compensated for.

My question is this - is this a legal practice? Can a state agency such as our school district mess with the pay schedule like this? The last time this happened, we went around with the HR department and got no real resolution. Thanks in advance for giving me more insight to this issue.

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  • 4 Comments
    • This is a discussion payroll professionals have nearly every year, but I have never heard of this method. There is no such thing in any of the tax tables as a 16-day or 19-day pay period.

      Good point. I missed that. Creating a legal odd payperiod tax withholding method is not impossible, IRS has rules on how to do that. But IN law could have rules on altering the pay period on a one time basis. This implies that the pay date would change on a go forward basis. This is odd indeed.

      The normal 27th pay period discussion is based on 14 days in a BW period times 26 pay periods per year is 364 days, while the year has 365-366 days in it. This implies that occasionally we have an extra full entire 14 day 27th pay period.

      #1; Fri, 22 May 2009 07:24:00 GMT
    • Public school, I'm assuming union? If so, have you spoken to your union rep about this?

      This is a discussion payroll professionals have nearly every year, but I have never heard of this method. There is no such thing in any of the tax tables as a 16-day or 19-day pay period.

      #2; Fri, 22 May 2009 07:17:00 GMT
    • What you describe is legal under federal law if done correctly (advanced notice). Your state is not my state and I have no opinion on IN law on this issue. If you are union, your contract could also have something to say about this.

      BW payroll has an extra 27th payroll every few years and it has been a long time discussion item in the payroll community on how to handle this. Some firms pay the extra payroll and some firms do what you describe.

      #3; Fri, 22 May 2009 07:15:00 GMT
    • Public school - non-union employee... I'm sure if I had a union, this would have never been an issue.. :)
      #4; Fri, 22 May 2009 07:18:00 GMT