Forced to move from monthly to 4 weekly pay

getmore4less

The reality is that if the budget is right/tight there many be a cash flow issue if all your monthly bills are the beginning of the month

Paid 28th March to cover April
(have a lean month in April to retain cash)

Paid 2 weeks 19th April, that would normally have been paid 28th of April so keep that back to start covering May.

Next pay is 17th May so early bills and a couple of weeks expenses

A salary paid 12 equal to 13 equal the difference is 7.7% reduction.

Given the number of people involved and the potential savings for the company with everyone on the same pay cycles supporting the proposal with a cash flow proposal may be the best outcome.

Or

juggle a few bills to eliminate the problem.


The fact that this is a problem means the household budgeting is on a knife edge if it cannot cope with a change of payment dates.

what would happen if the company paid late one month?

BLueeyeprom

No, at least half are on salary with only 20 near the NMW. It is easy for payroll to check these 20 and pay them the extra needed, I just think payroll are saying we have to change to make their life easier

BLueeyeprom

there are only 20 people near the NMW but probably 150 of us on salary pay now so it would make more sense to monitor the 20 rather than making the majority of us change.

BLueeyeprom

we have a very good payroll system that is designed to run two payrolls at once due to the nature of the industry we are in as we have a lot of casual employees. the payroll assistant only has to work 4 hours a week as a freelance on queries with the system the way it is as it is so it just seems ridiculous that we have to change. the majority of the team are against it or have signed as they have been told they have no choice and don't really understand the hardship they are going to be in in May.

System

If they're in hardship because of this then they have bigger issues than the pay dates being altered and perhaps suggesting to the staff who are going to experience difficulties that they contact Stepchange may be an idea as they're in debt crisis. Anyone who isn't living hand to mouth should have no problem coping with this alteration.

BLueeyeprom

thank you all for your comments. I don't think anyone is in debt crisis necessarily and I don't think I know many people who aren't living "hand to mouth" to be realistic. everyone is waiting for the next pay day to come round by the end of the month, 85% of my salary goes out in the first week with rent, car, council tax etc so only having 50% to live on for a month isn't going to work.
I was hoping for some more technical help from people who do payroll as even our auditors have questioned the need to change with the extra work it will entail to report 13 pay days into 12 accounting periods.

LilElvis

BLueeyeprom wrote: »

thank you all for your comments. I don't think anyone is in debt crisis necessarily and I don't think I know many people who aren't living "hand to mouth" to be realistic. everyone is waiting for the next pay day to come round by the end of the month, 85% of my salary goes out in the first week with rent, car, council tax etc so only having 50% to live on for a month isn't going to work.
I was hoping for some more technical help from people who do payroll as even our auditors have questioned the need to change with the extra work it will entail to report 13 pay days into 12 accounting periods.

I've been both a payroll manager and an auditor and the number of pay periods makes no difference to the work involved in performing the annual audit. It might cause your internal accountants a little extra work in calculating accruals for the unpaid payroll though, but this is not onerous.

JCS1

Surely this is a case where people use their emergency funds for a few months?

scalextric

I would agree with the last post on using emergency funds. If you dont have this then I would urge this is something to look into. Just think what would happen if there was an issue with your pay and it was delayed by a week or two, you need to have some money available to cover you. This would be best to have in a different bank to your main account where you get paid, so if something happens with your main bank account you can still access your bck-up funds.

Savvy_Sue

BLueeyeprom wrote: »

I was hoping for some more technical help from people who do payroll as even our auditors have questioned the need to change with the extra work it will entail to report 13 pay days into 12 accounting periods.

Then that's an argument you can use, although as I said, I'm not convinced.

We run one payroll, but we sometimes have people earning extra amounts in different ways. It works fine when we pay the 'extras' in arrears, eg you do an on call in February, we pay you in March.

It all starts to go horribly wrong when we have most people being paid their extras like that, and a few people being paid in the same month for irregular hours which we are predicting they will work that month, eg we ask you to work Wednesdays in February and we pay you in February.

so for me having everyone on the same basis is a no-brainer.