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July 21, 2003
Calendar Quirk Has Some Firms Adjusting Paychecks
Some companies are trimming the paychecks of salaried employees next year because of quirk in the calendar that adds an extra pay period, but this policy has some workers complaining, the Hartford Courant reports.

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In 2004, some companies will have 27 biweekly pay periods instead of the usual 26. Therefore, some companies have decided to adjust salaried employees' paychecks to account for the extra pay period and to make sure they add up to the employees' annual salary for the calendar year.

Some employees view this as a cut in pay. As they see it, they would be working at a lower biweekly rate or working more days for the same annualized compensation.

The newspaper notes that the calendar quirk will only affect some companies that pay on a biweekly basis, depending on their pay cycles and the day of the week their payday falls.

CIGNA Corp. is one company that plans to reduce workers' paychecks to account for the additional pay period. The company did the same in 1992, when a similar quirk appeared.

Companies can reduce paychecks like CIGNA plans to do as long as they give workers prior written notice, according to Ron Marquis, assistant director of the wage and workplace standards division of the Connecticut Department of Labor.

CIGNA says it compensates salaried employees on an annual basis and would be overpaying salaried employees if the company did not reduce the amount in paychecks next year.

Other companies facing 27 pay periods have decided against trimming paychecks. In Connecticut, Electric Boat, The Phoenix Companies, Inc and the Hartford Courant don't plan to reduce paychecks, according to the newspaper.

The issue doesn't affect companies that pay employees twice a month, meaning there are always 24 paychecks, the newspaper notes.


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