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  1. #1
    Join Date
    May 2007
    Posts
    21

    Default Can an Employer Legally Pay an Annual Salary Over a 14-Month Period

    My question involves labor and employment law for the state of: New Jersey

    I'm working with a bookkeeper at my company, my pay schedule use to be the following; June ‘16 used to be my period 12 and July ’16 would start pay period 1 again, however, they want to move us so Sept ’16 will be pay period 1.

    So this bookkeeper just took my salary and divided it by 14 months, so by Sept ’17 my department would be on the same pay schedule as everyone else, however, this seems illegal to me!

    My argument is you can't take my new salary contract which is for a 12 month salary and stretch it to 14 months just so I'm on the same pay schedule as everyone else. So basically they are paying me for month 13, 14 but taking it from my existing 12 month salary instead of these payments coming from the company's pocket.

    Is there any legal documentation explaining how the calculation they are using is not legal because they are stretching my salary to 14 months?

    Thank you!

  2. #2
    Join Date
    Oct 2006
    Posts
    16,474

    Default Re: Is It Illegal for an Employer to Pay a 12 Month Salary in 14 Months

    Quote Quoting olimits7
    View Post
    My question involves labor and employment law for the state of: New Jersey

    I'm working with a bookkeeper at my company, my pay schedule use to be the following; June ‘16 used to be my period 12 and July ’16 would start pay period 1 again, however, they want to move us so Sept ’16 will be pay period 1.

    So this bookkeeper just took my salary and divided it by 14 months, so by Sept ’17 my department would be on the same pay schedule as everyone else, however, this seems illegal to me!

    My argument is you can't take my new salary contract which is for a 12 month salary and stretch it to 14 months just so I'm on the same pay schedule as everyone else. So basically they are paying me for month 13, 14 but taking it from my existing 12 month salary instead of these payments coming from the company's pocket.

    Is there any legal documentation explaining how the calculation they are using is not legal because they are stretching my salary to 14 months?

    Thank you!
    Its not illegal, but it may be a violation of your contract if you have one. Have your contract reviewed by an employment attorney.

  3. #3
    Join Date
    May 2007
    Posts
    21

    Default Re: Is It Illegal for an Employer to Pay a 12 Month Salary in 14 Months

    Thank you for your reply!

    I took a closer look at my contract last year and compared it to my contract this year, and I see there is a 2 month gap due to moving me to this new pay schedule.

    - Last year contract: July 2015 to June 2016
    - Two month gap: July 2016, August 2016
    - Current contract: Sept 2016 to August 2017

    However, I continued to work during July 2016, August 2016; so I'm not sure if I have any leverage now since technically I wasn't under any contract. I've been with this company for over 5 years under the same July 2015 to June 2016 term but this year they decided to change this.

  4. #4
    Join Date
    Sep 2005
    Location
    Behind a Desk
    Posts
    98,846

    Default Re: Is It Illegal for an Employer to Pay a 12 Month Salary in 14 Months

    As has been explained to you, even if your nominal salary is the same, unless your employer violates minimum wage laws you don't have recourse under wage and hour laws, although you may have recourse under contract law. The question of whether or not you have a contractual right to be paid for the two months at issue would require a review of your contract. Whatever the dates specified in the portion you're looking at, it may be that a full review of the current contract would reveal that the intent was to pay you from July, 2016 through August, 2017.

    As your employer did compensate you for the two month "gap", even if by dividing your new contractual salary by 14 instead of by 12, your remedy lies in either convincing them to correct the injustice, or in trying to pursue a breach of contract case against your employer. Be forewarned that if you sue your employer for breach of contract, it's best to first have another job lined up.

  5. #5
    Join Date
    May 2007
    Posts
    21

    Default Re: Is It Illegal for an Employer to Pay a 12 Month Salary in 14 Months

    Quote Quoting Mr. Knowitall
    View Post
    As has been explained to you, even if your nominal salary is the same, unless your employer violates minimum wage laws you don't have recourse under wage and hour laws, although you may have recourse under contract law. The question of whether or not you have a contractual right to be paid for the two months at issue would require a review of your contract. Whatever the dates specified in the portion you're looking at, it may be that a full review of the current contract would reveal that the intent was to pay you from July, 2016 through August, 2017.

    As your employer did compensate you for the two month "gap", even if by dividing your new contractual salary by 14 instead of by 12, your remedy lies in either convincing them to correct the injustice, or in trying to pursue a breach of contract case against your employer. Be forewarned that if you sue your employer for breach of contract, it's best to first have another job lined up.
    Thank you for your reply!

    Yes, I see the only recourse I seem to have is under "contract law" for my current contract term; if they don't want to breach this contract they will need to retract the "2 gap payments" in July 2016 / August 2016 and pay me in 12 month period from Sept 2016 to August 2017, which is stated in my contract.

    However, the issue that still remains is not getting paid for this "2 month gap" since they decided to shift my contract dates forward by 2 months, so by August 2017 I would have earned $10K less because of this.

    I'm stuck between a rock and a hard place, because like you mentioned, it wouldn't be smart to take any legal action if I continue to work here without having another job lined up.

    However, I'm trying to see what the best approach is to have a professional conversation with my CEO to explain this situation better to see if they can understand how this "2 month shift" has effected me financially down the road.

    Thank you!

  6. #6
    Join Date
    Jun 2006
    Location
    Massachusetts
    Posts
    24,521

    Default Re: Is It Illegal for an Employer to Pay a 12 Month Salary in 14 Months

    You WERE paid for the two months. You told me so on the other board. The fact that you would have been paid more had they not spread out the time frame does not mean that you were working for free. As I have told you several times, THE LAW DOES NOT RECOGNIZE THE CONCEPT OF AN ANNUAL SALARY AS BINDING. If you got a paycheck; if that paycheck constituted the higher of state or Federal minimum wage plus overtime (if non-exempt) or $455 per week or more (if exempt) then the law does not care about anything else. One more time: WAGE AND HOUR LAW DOES NOT CARE HOW MUCH YOU GET PAID ANNUALLY. They only care how much you get paid weekly. You deal with contract law, or nothing. It is nothing but a contract law issue.

    Before you say ANYTHING to anyone, take the documentation you have to an attorney in your state and see whether or not you have a actual contract in the first place, and if so, if it has been breached in the second place. While all contracts are agreements, not all agreements are contracts. And even if it is a contract, the exact wording matters to whether it is enforceable or not. You do not want to jeopardize your position by complaining about your wage, if it should turn out that (a) you do not have a contract or alternately (b) you have a contract but it does not say what you believe it says.

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