Week 53 for 4-weekly paid staff.

Hi,

I wonder if anyone could help to explain the implications of Week 53 on people who are paid 4-weekly.

My employer has just announced that those of us who are paid 4-weekly and salaried (as opposed to hourly paid) will not be paid for the final week of this tax year.

The reason they are giving is that we are actually paid an extra 0.25 of a week's pay on each of the 52 week tax years and that this will then fall in line every 4 years with Week 53.

I wonder if anyone can give any insight..and basic laymen's terms into the legality of this? Plus the implications this has for those who have not yet been paid for the full 4 years? (my assistant for example has only been with the company 2 months)

Thank you!

Are you paid 4 weekly or calendar monthly? Is your gross salary not simply divided by the number of payments that you get (e.g. divided by 52 for weekly, 13 for four weekly, 12 for calendar monthly etc.)?

We're paid 4-weekly, 13 payments a year

So do the not simply divide your annual gross salary by 13?

Usually, however as this is their fiscal year with a 53rd week they are saying that we won't be paid. Although the fiscal year ended in June apparently they are only allowed to make this adjustment at the end of the financial year.

We'll be paid as usual at the end of March, then we'll receive our normal 4-weekly pay five weeks later.

I still don't get it. If you earn x per annum and you get x in whatever number of payments it takes throughout the year then I don't see what the problems is. Maybe I'm (still?) missing the point here.

What does your contract of employment say about payment of salary and any mysterious 53rd week in each 4th fiscal year?

Hmmm, ok perhaps you have a valid point there.

I guess we're just used to having a weekly figure paid even though it's an annual salary. (Still feels as though we'll be working a week for nothing though!)

My statement of terms simply states payment will be made 4 weekly, no reference to a 4th year. I've been with the company longer than that..and this wasn't the situation 4 years ago.

Surely it's the same as me getting paid the same (my gross divided by 12) each calendar month even though the months vary in length from 28 (29 in a leap year) to 31 days. I don't consider it "working for nothing" for the 1, 2 or 3 days more that 11 of the months exceed February by and everything balances out on an annual basis.

Surely it's the same as me getting paid the same (my gross divided by 12) each calendar month even though the months vary in length from 28 (29 in a leap year) to 31 days.

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No, it's not the same. You will always get 12 payments a year when you are paid calendar monthly. The issue never arises. When paid according to day of the week (eg Thursday), then an extra payday can occur in a year. (because 365/7 isn't exactly 52. There might be 53 Thursdays)

Week 53 can happen for weekly, fortnightly and four-weekly employees. Correct procedure is to process the wages on a week one basis, with a 'pay period's' worth of tax credits and standard rate cut off point.

There is an explanation here
[broken link removed]

[NOTE: I'm affliated with the above website]


(Incidently, without getting my calculator and calendar out, I'd guess that the four-weekly scenario only happens once every 28 years, ignoring leap years.)

Interesting thread. Simplify it this way. For arguments sake say you are salaried at 52k per year.

If your contract states 52k per year and then says 39 hours per week without giving an hourly rate and you are paid 1k per week, then the situation can arise where there are 53 pay weeks in one tax year but as when you have been paid 52k your contract salary is fulfilled an employer could be petty and not pay for week 53 ( this would indicate to me that a) the employer is not a nice one ot work for or b) could be in financial trouble )

If on the other hand you have an hourly rate in your contract which in this case would be (1k per week / 39 ) €25.64 then your employer has to pay you for each hour worked including those in week 53 because you will have worked more hours in this financial year than in others and in this scenario would be paid for them.

Veev - you need to divide your annual salary by 13 and see if that is what you are being paid by your employer every 4 weeks. If your employer is paying more than this for whatever reason then they would be right to stop payment but you would have to wonder what reason there is to pay you this way as the most logical way to pay 4 weekly people is to pay them 1/13th of their salary every 4 weeks.

If your contract states 52k per year and then says 39 hours per week without giving an hourly rate and you are paid 1k per week, then the situation can arise where there are 53 pay weeks in one tax year but as when you have been paid 52k your contract salary is fulfilled an employer could be petty and not pay for week 53

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(Ignoring leap years)
There are 2555 days in seven years
Number of (seven day) weeks in seven years = 365
Employee gets €1000/week
Over the course of seven years they should get €365,000
However, €52000 x 7 = €364,000

The employee is down €1000.

The important point here is that the employee is paid by the week and not the calendar month. In the above scenario, the employer is short changing the employee about €143 a year.

check the definition of a salary - employer is correct - why should they overpay?

umop3p!sdn said:

(Ignoring leap years)
There are 2555 days in seven years
Number of (seven day) weeks in seven years = 365
Employee gets €1000/week
Over the course of seven years they should get €365,000
However, €52000 x 7 = €364,000

The employee is down €1000.

The important point here is that the employee is paid by the week and not the calendar month. In the above scenario, the employer is short changing the employee about €143 a year.

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As Rmelly touches on and as i was saying myself earlier, if your contract states €52k per year then an employer can pay you €52k per year - 7 years x €52k is €364k

The employee being down 1000k over the 7 years as you put it is similar to the original posters situation of not being paid on week 53.

It comes down to the definition of a salary and how the employer enforces the same.

It comes down to the definition of a salary and how the employer enforces the same.

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I agree.

The payment frequency should also be outlined. If an employee is to be paid €1000/week then they should get a day extra (week53).

I have my doubts the OP's employer is correct though.

The reason they are giving is that we are actually paid an extra 0.25 of a week's pay on each of the 52 week tax years and that this will then fall in line every 4 years with Week 53.

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Why every 4 years?

I have worked in a company which made similar allowances, however they do it in reverse to this situation. Employees are paid every second Thursday, which is usually 26 pay periods in a year. Some years, however, there are 27. If you are paid €20,000 a year, they divide your pay by 26.25 instead of 26, to allow for the extra payment once every 4 years.

Paid €761.90 per pay period, or €19809.50 a year. In the fourth year you still get €761.90 but it results in €20571.43 for the year, making up the reduction in the previous years. Over the 4 years it adds up to €80000 (with possible rounding discrepancies, probably less than €0.10).

I would suspect that most companies who pay annual salaries but not monthly pay periods make similar adjustments. They're just not telling people about it.