January 9, 2020
Leap Year: Are Workers Entitled to an Extra Day’s Pay?
2020 is a leap year which means there are 366 days in the year rather than the standard 365 days. The additional day falls on 29th February.
There are lots of traditions and myths surrounding 29 February. For example, the US always have presidential elections in leap years. In addition, there’s the myth that it’s only acceptable for women to propose to men on 29 February. As well as matters of the heart, there’s another burning question surrounding this day. Are your employees entitled to an extra day’s pay?
An employee’s entitlement to pay for the additional day in a leap year depends on how they are paid
Salaried employee who receive the same basic pay every month are not entitled to additional pay on a leap year.
However, there is an exception to this.
For employees earning the National Minimum Wage (NMW) or slightly more, you need to check the additional day doesn’t reduce their pay to below the statutory minimum. Remember, failure to pay the NMW, can result in criminal conviction and/or financial penalties of up to 200% of arrears.
Employees who are paid according to the hours they work
Employees who are paid according to the hours they work or the amount of work they complete should get paid for working an extra day.
Moorepay makes it easy
When it comes to payroll, the list of things to think about can seem endless and complex.
When your payroll system is running like a well-oiled machine it goes unnoticed. But getting wages wrong can have frightening consequences.