Changing from 26 to 24 pays

This document lists out the issues to consider when going from 26 to 24 pays.

From 26 to 24 pays

From 26 to 24 pays

  • Moving from 26 to 24 pays

    1. Set up new pay dates and pay periods for the 24 pay year.

    2. Look at Payroll Item’s Pay Cycle in Core/Payroll Item to see if any need adjusted due to being set up as “Every pay of the month (even third pay)” (26).

      1. Examples could be Annuities, Child Support, Garnishments, Dues, United Way that are set up on a bi-weekly amount. These may need to be converted to a semi-monthly amount.  

      2. Federal, Ohio, City, STRS/SERS, Medicare, and OSDI should be marked as “Every Pay of the month (even third pay)” and those do not need updated.

      3. Those set up on the “Split between first and second pay of the month” are only deducted twice now and should be okay.

      4. Voluntary deductions withhold every payroll will have to be reviewed to insure the withholding amount is correct, due to 2 less pays.

      5. Annuity type deductions that are a percentage withholding may have to be reconsidered by the employee or annuity company, so the maximum contributions as permitted by the IRS are not exceeded.

      6. Deductions with maximums to withhold may need adjustments so they do not over or under withhold.

    3. Pay Account Maximums to charge may need adjustments.

    4. Employee’s with Stretch Pay Compensations will need to be updated with the new number of pays in contract, along with a new pay per period amount between the last bi-weekly and first semi-monthly payroll.

      1. Using the 26 to 24 Pay Compensation Worksheet report found on the Report Repository. Create a spreadsheet with a list of current compensations that are set up as 26 and need to be changed to 24 pays and an updated Pay Per Period. 

        1. You will use a formula to take the Contract Obligation amount minus the Amount Paid, minus Amount Docked to get the Remaining Amount Due.

        2. Then take the Pays in Contract and reduce that number by 2 (26 – 2 = 24).

        3. Then the new number of pays in contract minus the Pays Paid this will give you the number of pays remaining.

        4. Finally, take the Remaining Amount Due divided by the Pays Remaining. This will be the new Pay Per Period for the remainder of the contract.

      2. These two new amounts: Pays in Contract and Pay Per Period can be loaded into the existing Compensations by creating a .csv load spreadsheet with the following columns:

        1. position.employee.number

        2. position.number

        3. code

        4. paysInContract

        5. payPerPeriod

      3. Load the Spreadsheet with Utilities/Mass Load with Importable Entities: Compensation

    5. All Compensations will need to have their Pay Plan updated to “Semi-monthly”. When the district has paid their last payroll as bi-weekly, but before initializing their first Semi-monthly payroll, they should send a request to to request  a mass change on all compensations to the status of Semi-Monthly.  NWOCA will make this change and let the district know when complete.  The district can then initialize their first Semi-Monthly payroll.

    6. When Initializing their first Semi-Monthly Payroll. They will use that Pay Plan as shown below. This will allow the new wages to be taxed as semi-monthly amounts.

    7. Other items to consider:

      1. Pay Dates and Pay Period Updates with SERS, STRS, Ohio Deferred Compensation, and any other Deductions that expect payment on certain days/weeks or know your payment schedule.

      2. The pay per period on stretch pay jobs will be increased, employees may need to file new tax forms for taxation purposes at the Federal and Ohio levels.

      3. Taxes withheld on a percentage basis will increase with the increased pay per period.

      4. Retirement buy-back calculations may have to be resubmitted to the retirement systems.

      5. The number of days between payrolls will become inconsistent due to the fixed pay dates falling on a weekend or holiday. This will cause days worked on the pay stubs to be irregular as well as the amount going into accrued wages.

      6. A 24 pay cycle will make direct deposit transfers more irregular. Depending on what day of the week the pay date falls, the transfers may need to be made the preceding week considering all weekends and bank holidays, which many times fall on a Monday.

      7. If all positions are not changed at the same time, the district will have to run multiple pays until all positions are on the same 24 pay cycle. This will likely occur after all new contracts have been purged.

      8. Updating any Third Party software that is used for payroll data collection of items such as absence/attendance tracking.