How does leap year affect your paycheck?
2024 is a leap year, which means there’s an additional day this month, and Feb. 29 happens to be a Thursday (a regular old work day). When it comes to paying people who work on leap day, there are a range of ways that employers need to prepare for it.
Leap day pay is most straightforward for hourly employees.
“They have to be paid for all hours worked,” said Amber Clayton with the HR membership organization SHRM.
For salaried employees, it can work a couple of different ways: Sometimes, a leap year triggers an additional pay period.
An employer could divide each annual salary over a greater number of paychecks, which means “each paycheck would actually be smaller than normal.”
Another option is for employers keep each paycheck the same, Clayton said, even if they end up paying workers slightly more that year.
Companies’ payroll costs can add up in leap years, explained Paycom’s Jennifer Kraszewski.
“Essentially, they need to look at their labor budget and plan accordingly for that extra day,” she said.
Also, Kraszewski added, if someone starts on Feb. 29, their employer needs to make sure that work anniversary is still noted in non-leap years. After all, you don’t want people thinking you’ve worked some place only two years when actually you’ve been there eight.
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