Until recently, there’s been something I’ve always wondered about the paycheck I get from UMBC. We’re paid biweekly, which translates to 26 paychecks per year. Now, the University gives me a certain dollar amount as my annual salary. But if I add up the gross pay from each of those 26 paychecks, it always comes out to slightly less than what the University claims is my annual salary. Being the paranoid type, I always assumed the University was short-changing me. Happily, I was wrong. The figure the University gives me is for 365 days (or 366 days in a leap year). My paychecks cover 26 14-day pay periods, or 364 days. So, in most years, I’m receiving paychecks that cover only 364 days. To get my actual annual salary, I need to take the sum total of all my paychecks, divide by 364 to get the per-day pay rate, and multiply the result by 365 (or 366 in a leap year) to get my salary for a full 365 (or 366) day year. When I do this, the result always matches the annual salary reported by the University.
So what happens to the remaining 1 or 2 days worth of pay? It gets rolled into the following year’s pay, and every so often, we end up with a year where we get an extra paycheck (for a total of 27 paychecks). To an unwashed employee like me, this seems like a confusing way to do accounting, but it does all add up in the end.
While I’m on the topic, I should plug what is probably the most useful site on the State of Maryland’s website (at least for state employees): The Central Payroll Buerau Net Pay Calculator. You basically enter your gross biweekly pay, all pre-tax deductions, and number of exemptions from your W-4, and it tells you what your net pay will be. Very, very handy when you get a raise, or your pre-tax deductions are changing, and you want to see what effect it will have on your net pay.