Presently, my company has been purchased by another company. Currently our employees are paid biweekly since most are paid on a fee basis type of payment schedule meaning they have several different rates. Additionally they are paid on a two week lag. We only have 4 people on salary. Now the new company is trying to convert us over to their semi monthly schedule which would cause a 14 day holdback for our employees. Our next pay day is June 3. It covers the period of 05/10 to 05/23. The next period they only want to pay us for 05/24 to 05/31 on Jun 15th. Then pay us for 06/1 to 06/14 on June 30th. Many employees cannot afford this change with such short notice. What would be a better approach given that most employee work on a fee basis schedule?
What would be the best way to convert biweekly employees with a two week lag to semi monthly
Answers
We went through a change many years ago to institute a 10-day lag due to the addition of hourly staff to the payroll (previously all salaried). This resulted in employees waiting 25 days between checks in the period that the payroll changed. Because we implemented this change without much notice, we offered employees short-term advances to bridge the gap with repayment over the next 6 checks. Only a couple people took us up on that option but the mere offer helped convey that we understood the hardship it might cause.
You should check state law. Some states do not allow for this long of a hold back. I know of at least one that says employees must be paid within 6 days of the end of the pay period.
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I checked NYS (http://codes.findlaw.com/ny/labor-law/lab-sect-191.html). With the exception of manual workers (and some limited carve-outs thereof) who must be paid weekly, the longest period between pay periods would be semi-monthly. Commission people must be paid at least monthly, but according to their contract.
So, it seems impossible to have, in NYS, a 25 day lag time, and the most it could be is 15 days.