OK, I need payroll person to explain something....

[chager]

Due to the salary to hourly transition that is now completely screwing us over, dh was told he would be getting a payroll loan for this pay and then we would have to pay it back over the next several pays (at a payment which is going to cause us a financial burden). Here is my question though...since they are saying we have to repay the total gross amount of the check does that mean they are not taking out taxes or our deductions? I asked him to clarify all this and to inform them that the amount they want to deduct is still causing us an issue. Apparently they pay salary employees current and hourly are 2 weeks behind. They are doing the loans so no one has to miss a pay. I think this is total bs but not much I can do. Since he hasn't heard anything back yet I am guessing we are not the only ones flipping out over this. Any insight?

 

[camreesmom]

Is this because of the new exempt/non-exempt regulation that was supposed to go into effect on December 1st?

 

[Gumbo4x4]

I know with 401k loans, repayment comes out AFTER taxes. I would think it would be the same here.

BTW, while the temporary delay in pay sucks for one pay period, the thing is under the new scenario, if you quit, you'll still have at least one check coming after the fact whereas you wouldn't have under the salary structure you had before.

PS I hate being salary. I've always worked 3-500 hours of OT a year. It sucks not getting paid for that. The big "raise" that accompanied my switch back to salary has actually resulted in a pay cut - which is tough to swallow from an employer that grew 40% this year

 

[chager]

Is this because of the new exempt/non-exempt regulation that was supposed to go into effect on December 1st?

Yes

 

[chager]

I know with 401k loans, repayment comes out AFTER taxes. I would think it would be the same here.

BTW, while the temporary delay in pay sucks for one pay period, the thing is under the new scenario, if you quit, you'll still have at least one check coming after the fact whereas you wouldn't have under the salary structure you had before.

PS I hate being salary. I've always worked 3-500 hours of OT a year. It sucks not getting paid for that. The big "raise" that accompanied my switch back to salary has actually resulted in a pay cut - which is tough to swallow from an employer that grew 40% this year

I was guessing they would take out the repay after taxes. I am wondering if they still are going to tax this "loan" paycheck and then make us payback the whole thing including the taxes. If that makes sense. It is a pain because he had more flexible hours before and now he has set hours. He always got in his 8 hours and occasionally put in extra but not often. However he could adjust his hours for the week, like when the car needed fixed he was able to adjust his hours to start later and end later that day. if that makes sense.

 

[mickeymedic]

Didn't the new law get postponed? My pay structure was supposed to change on December 1st. But I got a notification from our company president that the courts have put a hold on the new law. So nothing will be changing for now.

 

[chager]

Didn't the new law get postponed? My pay structure was supposed to change on December 1st. But I got a notification from our company president that the courts have put a hold on the new law. So nothing will be changing for now.

Yes it did, but his company has decided to push forward with it anyway.

 

[mickeymedic]

Yes it did, but his company has decided to push forward with it anyway.

Oh. I'm so sorry. Our company president couldn't be happier that we don't have to go to the new pay structure. We all agree with him. I'm sorry you're being negatively affected by a law that may never go into effect.

 

[chager]

Woo hoo!!! Hubs just got an email that they have reconsidered and payroll will normal and the "loan" is off the table! His boss really went to bat for him and some others! Doing a serious happy dance!

 

[Bluestars]

If they give an employee a loan, it should be an accounts payable check in which no payroll taxes or deductions are made. Then the amount can be deducted from a pay check as a misc detection. This is the way it will not affect a person's taxes.

If they advance pay to an employee, then they can deduct the advancement from the gross amount of a paycheck. Like if they advanced $500 gross pay to a person (then taxes are taken out) in the form of a payroll check, then can then deduct $500 gross from the following paycheck. It will be a wash.

 

[Bluestars]

Oh. I'm so sorry. Our company president couldn't be happier that we don't have to go to the new pay structure. We all agree with him. I'm sorry you're being negatively affected by a law that may never go into effect.

Our company was THRILLED.

 

[Gumbo4x4]

Our company was THRILLED.

Of course, it's a huge cost savings.

 

[Bluestars]

Of course, it's a huge cost savings.

Yes, it is.

 

[usnuzuloose]

Why is he being made to pay back? I may be missing something. About 9 years ago someone sued the company we worked for and we as managers were salary and the atty's said no you are not exempt and they had to go to hourly. We had to pay nothing and just went straight to hourly and in fact they owed every manager back pay for what we should have got paid for. That was a lot of money for many people. And what is the new law?

 

[Gumbo4x4]

Why is he being made to pay back? I may be missing something. About 9 years ago someone sued the company we worked for and we as managers were salary and the atty's said no you are not exempt and they had to go to hourly. We had to pay nothing and just went straight to hourly and in fact they owed every manager back pay for what we should have got paid for. That was a lot of money for many people. And what is the new law?

Under their particular salary system, they are being paid AS they work. Under the new hourly system, pay checks were to be 2 weeks AFTER pay period ended. So, the company was proposing loans to bridge the gap during the period of no check.

Edit: the new law extends non-exempt to a much higher salary range.

 

[tvguy]

Under their particular salary system, they are being paid AS they work. Under the new hourly system, pay checks were to be 2 weeks AFTER pay period ended. So, the company was proposing loans to bridge the gap during the period of no check.

Edit: the new law extends non-exempt to a much higher salary range.

I am hourly at my current job, but for 16 years I was "salaried exempt". Never had to deal with the current law change, but there always seems to be issues. We used to get paid twice a month, 24 paychecks a month. They switched to every 2 weeks, but continued to divide your salary by 24 instead of 26 pay periods (27 pay periods every 11 years). When asked, they refused to deal with it, so it went to the labor commission who fined them and ordered them to go back and give all salaried employees the 2 weeks pay they were owed.
Got worse when they got bought up by a new company, where everyone in my type job at the new owner was hourly, but they kept everyone on my side salaried. They moved them all into the same building after I left, and so now you have people, working literally side by side doing the same work, some hourly, some salaried, just depending which division they were working for.

 

[Mackenzie Click-Mickelson]

I know with 401k loans, repayment comes out AFTER taxes. I would think it would be the same here.

BTW, while the temporary delay in pay sucks for one pay period, the thing is under the new scenario, if you quit, you'll still have at least one check coming after the fact whereas you wouldn't have under the salary structure you had before.

PS I hate being salary. I've always worked 3-500 hours of OT a year. It sucks not getting paid for that. The big "raise" that accompanied my switch back to salary has actually resulted in a pay cut - which is tough to swallow from an employer that grew 40% this year

My husband's company adjusted a few years ago for salaried employees. For him he needs to work at least 45hrs in a week to be eligible for overtime; it used to be no overtime period for salaried employees. The hourly employees are 40+ hrs=overtime. This is when he is in the office. Being in a field assignment differs from that policy.

 

[Mackenzie Click-Mickelson]

My last company was ridiculous on figuring out pay. You couldn't asked me what I made per hr because that varied depending on how many hrs per pay period. I was an hourly employee with a guaranteed base salary per year.

Up until Jan 1st 2016 they paid bi-weekly;it was the 15th of the month and the last day of the month. If any of those days fell on the weekend you were paid that Friday. My pay periods would have something like 80hrs one time but then 88hrs another time. Overtime pay RATE (at 40+hrs paid by the minute) then depended on how many hrs per pay period so my overtime pay rate fluctuated.

On Jan 1st 2016 they changed to a every 2 weeks pay which effectively added around 2 paychecks per year but made each paycheck slightly less since it was spread out differently.

 

[sam_gordon]

You couldn't asked me what I made per hr because that varied depending on how many hrs per pay period. I was an hourly employee with a guaranteed base salary per year.

So most full time hourly employees would work 2080 hours in a year (52 weeks * 40 hours/week). Did you have some weeks where you would work 30 hours and some weeks you would work 50? Even if that's the case, you should take annual salary/2080 and that's your per hour rate. The paycheck would change based on how many hours you worked/whether benefits were taken out (our insurance benefits are taken out twice a month and we sometimes end up with three pay periods in a month), but your per hour rate shouldn't change.

 

[Mackenzie Click-Mickelson]

So most full time hourly employees would work 2080 hours in a year (52 weeks * 40 hours/week). Did you have some weeks where you would work 30 hours and some weeks you would work 50? Even if that's the case, you should take annual salary/2080 and that's your per hour rate. The paycheck would change based on how many hours you worked/whether benefits were taken out (our insurance benefits are taken out twice a month and we sometimes end up with three pay periods in a month), but your per hour rate shouldn't change.

No full time employees worked 40hrs per 7 day period. Sure some days would be PTO days but you still got paid for those days.

My rate per hr did change however each paycheck had a base guaranteed amount. It was just how they structured the way you were paid. Your overtime rate dependeded on your rate per hour which depended on the number of hours worked in a pay period. Sure I could divide how many paycheck per year I got by the base guaranteed salary per year (still as an hourly employee) and say that but that's not exactly how the company calculated how much you made per hour.

Here's two back to back paychecks I had lying around from 2014-Notice how the per hour rate changes but the base amount of the paycheck did not;any overtime pay however would vary: