Holding Paycheck

[Jennyinoregon]

What is the name of your state? Oregon

My husband works for a well known Ambulance/emergency response company. He just started there and worked for a week and 1/2 then payday arrived and he was told he had to wait till next payday, two weeks away... How can they justify doing that?

 

[Ramoth]

It's quite possible that by the time your husband got all of his documents turned in (W4, I9, etc.) it was too late to add him to the system for payroll

 

[gobonas99]

What is the name of your state? Oregon

My husband works for a well known Ambulance/emergency response company. He just started there and worked for a week and 1/2 then payday arrived and he was told he had to wait till next payday, two weeks away... How can they justify doing that?

They can justify it because it is a standard accounting practice for payroll. As an accountant, this is how payroll works in many companies: an employee gets paid on payday for the PREVIOUS pay period.

It sounds like your husband's employer has 2 week pay periods (ie your husband will get paid every other week). So, let's say that last Friday (Oct 31st) was pay day. The pay period being paid is the PREVIOUS two-week pay period (Sat Oct 4 through Friday Oct 17). Let's say your husband started work on Thursday, October 23. His time from Oct 23 through Friday, October 31 is the CURRENT pay period, and will be paid on the next payday (Nov 14). Conversely, if your husband were to voluntarily leave the company on say, Wednesday, Nov 12 (pay period of Nov 1 through Nov 14), he would be paid on Nov 28.

This is a perfectly legal, standard payroll system.

-Christina

 

[Jennyinoregon]

Thank you for the info. I understand the justification now, however I still think if a man makes an agreement with a company to work and be paid for it, he worked for a week and 1/2 during the 1st pay period and should be compensated for those days. The company will forever be holding two weeks of pay from him until he quits. I think the whole process is a waste of time. It should be simple, you work for 5 days you get paid for 5 days. I guess it could never be that simple, it would be too easy! Thanks again for explaining it. I appreciate it!

 

[Beth3]

What you're overlooking is the time it takes for time cards to be turned in, reviewed and approved, entered into the payroll system along with any changes (base pay, withholding, deductions, etc), transmitted to the payroll company, paychecks printed and mailed, and so forth.

The company will not "forever be holding" two weeks pay for him. It's just a simple lag time issue. At such time as he leaves this employment, his last paycheck for his final two weeks of wages will be provided to him the pay period after his departure.

 

[gobonas99]

Thank you for the info. I understand the justification now, however I still think if a man makes an agreement with a company to work and be paid for it, he worked for a week and 1/2 during the 1st pay period and should be compensated for those days. The company will forever be holding two weeks of pay from him until he quits. I think the whole process is a waste of time. It should be simple, you work for 5 days you get paid for 5 days. I guess it could never be that simple, it would be too easy! Thanks again for explaining it. I appreciate it!

They are NOT holding 2 weeks pay from him, it is merely the payroll system this particular company chose to adopt. If you work for 5 days, then your DO get paid for those 5 days. And it IS simple.

A major factor that goes into a company's choice of payroll systems is how many hourly vs salaried employees they have. If a company has a lot of hourly employees or if they permit overtime, then it is MUCH more likely they will use a delayed pay day.

Try to think about it from an accounting perspective. If you have an hourly employee who must submit time cards, it is IMPOSSIBLE for the payroll accountant to receive their timecard at the end of the day friday, calculate their pay, AND cut the check before they leave for the day.

There are certain steps that must be performed before an hourly employee can be paid. First, their timecard must be approved by their manager/supervisor (no approval, no paycheck). Then hours must be entered into the system for each employee, and any overtime hours calculated. The more manual the time card system is and the more employees there are, the longer it takes the payroll accountant to process. Then deductions must be made for health insurance, pre-tax retirement contributions, etc. Then social security, medicare, and federal and state taxes must be calculated and deducted. Finally, any after-tax deductions (ie additional retirement contributions, wage garnishments, etc) must be taken before finally arriving at the net pay. THEN, the payroll accountant's work must be reviewed and approved before any checks are cut or direct deposits made. And this process is assuming payroll is done in house - if a payroll company (such as ADP) does the processing, add time for the information to be transmitted to the outside company.

Your husband WILL be compensated for the time he worked...in accordance with their payroll system.

-Christina