Are you getting the 12-year bonus this year? Questions about 2004 and its 27 pay periods for employees paid bi-weekly inside...
OK, a bit of background - If you are on a bi-weekly pay schedule and were paid on January 1st or 2nd of this year, then your 2004 has 27 pay dates rather than the normal 26 This is due to the gregorian calendar not matching up nicely with fortnights. This happens every 12 years, so it will happen again next in 2016 and so on. This does not affect people paid bi-monthly, monthly, daily or hourly.
A company can handle this one of several ways:
-Divide the total salary by 27, resulting in a bi-weekly payment slightly less than in 2003 but equalling the yearly salary
-Withhold the final payment due December 31st 2004, fullfiling the yearly salary
-Paying a once-every-twelve-year bonus, equalling a normal, 26 pay period cheque. In effect, if your yearly salary is $100,000, you will have been paid that in 2002 and 2003, but roughly $103,846 in 2004.
discuss some of the issues around these options.
Any of theses options come with personal tax implications, RRSP (or 401k or whatever) adjustments, 27 bi-weekly mortgage payments and much more. For the company, they must account for changes to total payroll, taxes, whatever. For the world, it should theoretically affect GDP, disposable income, retail sales, savings, and so on.
My questions are:
-Is what I say correct, or am I missing something?
-How is it possible that companies continue to pay bi-weekly salaries if this comes up every once in a while? It must a complete mess, no?
-Given the third choice, the bonus payment (which it looks like I will receive), does this not mean a huge one-time spike in purchasing power for those affected and their families? Will this Christmas season set records due to the 4% bonus that millions of people will be receiving this year?
-In general, can anyone tell me how their workplace is handling this, or how the world at large handled it in 1992?
-Finally, how is this not bigger news? It seems to affect many people, companies and even countries greatly no matter which option of handling this is chosen, yet all I could really find are the two articles I linked to.