Can a company alter its payday schedule?
Feb 24, 2014
I implement many payroll transitions with our payroll service clients here at HireLevel. Over the past 2 years, I have found some processes are easier than others when transitioning. However, the one thing that isn’t fun to change is moving paydays. No two businesses are the same and everyone has their reason to change their payday.
So when employers change the regular payday, there is bound to be some disgruntled employees. Paydays are sacred in the workplace! It amazes me an employee who can’t remember to clock in can tell you exactly how many days until the next paycheck.
Can a company alter its payday schedule? The Fair Labor Standards Act (FLSA) does not prohibit employers from changing paydays. But the law states that wages must be paid when due, which typically means the next regularly scheduled payday. This promotes a problem. The FLSA requires that employees be paid promptly, but otherwise does not specify exactly when. Employers are not prohibited from changing the beginning or ending dates of a pay period if the change:
- Is made for legitimate business purposes.
- Is permanent.
- Is not made in order to avoid paying overtime and does not violate minimum wage laws.
- Does not unreasonably delay payment of wages.
If your company is considering changing its designated pay schedule, check your state’s requirements. Also, consider posting the schedule in a common area in the workplace.
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