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  • Payroll Percentage

    At the beginning of a given year, the Shipping Department has four people, each paid $1,000 a month. In that year, each of these employees receives a monthly pay raise of $100. These raises are given March 1, June 1, August 1, and November 1, respectively. The raises increased the payroll cost for the year by?

  • #2
    Is this another homework assignment? Sounds like the question is right out of an accounting book.
    I don't respond to Private Messages unless the moderator specifically refers you to me for that purpose. Thank you.

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    • #3
      Is this the answer?

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      • #4
        I agree with Pattymd. This does seem like an odd question. But since I haven't seen anything odd from you before, I'll assume you're serious. It's $9,600. Here's how I got there.

        The August 1 raise is the odd one here. This company should probably consider moving to a quarterly system to make things easier for the accounting department. If they don't move to quarterly raises, then they have to consider the additional reporting and accounting requirements for mid-quarter changes. In any case, without calculating for the additional accounting expense incurred for operating the program, and assuming (1) they want to keep 8/1 as the mid-term raise date, (2) all 4 employees remain employed through the full year, (3) we're not accounting for the additional employer contributions to SS, FICA and FUTA, and (4) these employees are properly classified as salaried employees, then these increases add $9,600 in total payroll expense.
        Last edited by CompensationCounsel; 11-26-2005, 11:35 AM.
        This post is by Philip Gordon, a Massachusetts employment attorney (www.gordonllp.com).

        This post is NOT legal advice. It is for general/educational information purposes only. You should not rely on this post if you are making decisions, and it does not create an attorney-client relationship. This post may be considered "advertising" under the MA professional rules for attorneys.

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        • #5
          Thank you.

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          • #6
            For the record, and for future reference, we do not do other people's homework here. You got lucky once because the responder who replied to you is new here. But if you have future homework assignments, do not expect to get answers here.
            The above answer, whatever it is, assumes that no legally binding and enforceable contract or CBA says otherwise. If it does, then the terms of the contract or CBA apply.

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            • #7
              For the record, this is not a homework assignment.

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              • #8
                Well, it can't be real life if the employees are exempt salaried, because that is below the minimum salary required for exempt status. And the equivalent hourly rate for nonexempt would be $5.77/hr. I don't know many places that pay that low for such work.
                I don't respond to Private Messages unless the moderator specifically refers you to me for that purpose. Thank you.

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                • #9
                  I will disagree with Compensation Counsel. I think the trick is in the wording of the problem. I read the word "respectively" to mean that the four pay raise dates refer to each of the the four employees. If all employees were given the same raise on the each of the dates, there would be no need for the word respectively. In addition, the problem states that each employees receives "a monthly pay raise of $100." The word "a" means only one. Thus, applying meaning to each word, we come up with a different answer: $2400

                  In any case, the poster is left with two different answers from two different attorneys and will have to work out on his own what to do.


                  Michael Tracy
                  Attorney
                  http://www.gotovertime.com

                  Disclaimer: The above response is a general statement of California law. It only assumes the facts that are stated in the message. The above response does not serve to form an attorney-client relationship.
                  Michael Tracy
                  Attorney
                  http://www.laborlawradio.com

                  Disclaimer: The above response is a general statement of the law and should not be relied upon as legal advice. It only assumes the facts that are stated in the message. The above response does not serve to form an attorney-client relationship.

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                  • #10
                    Or Michael, maybe he'll have to work it out with his math professor.
                    I don't respond to Private Messages unless the moderator specifically refers you to me for that purpose. Thank you.

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                    • #11
                      Patty and Michael,

                      Do you think the answer would be different if there were two trains involved leaving the shipping department for Chicage and New York?

                      Phil
                      This post is by Philip Gordon, a Massachusetts employment attorney (www.gordonllp.com).

                      This post is NOT legal advice. It is for general/educational information purposes only. You should not rely on this post if you are making decisions, and it does not create an attorney-client relationship. This post may be considered "advertising" under the MA professional rules for attorneys.

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                      • #12
                        Probably.
                        I don't respond to Private Messages unless the moderator specifically refers you to me for that purpose. Thank you.

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                        • #13
                          I've already said this to Michael; Phil, welcome aboard! It's good to have you - hope you stay a while!
                          The above answer, whatever it is, assumes that no legally binding and enforceable contract or CBA says otherwise. If it does, then the terms of the contract or CBA apply.

                          Comment


                          • #14
                            Thanks for being so welcome. I'm looking forward to helping out.
                            This post is by Philip Gordon, a Massachusetts employment attorney (www.gordonllp.com).

                            This post is NOT legal advice. It is for general/educational information purposes only. You should not rely on this post if you are making decisions, and it does not create an attorney-client relationship. This post may be considered "advertising" under the MA professional rules for attorneys.

                            Comment

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