We all know how leap years add an extra day to the year every four years. If you’re paid biweekly, you may end up with a 27th paycheck in the year for similar reasons. So check with your payroll department.
Different employers handle this in different ways. Some companies will divide your total yearly pay by 27 instead of 26 to evenly distribute your wages, while others may simply treat the extra paycheck as a “bonus.” In either case, as Redditor fontophilic explains, this has implications for many of your benefits:
FSA, HSA, 401K/403B, ESPP, and other pre-tax benefits are frequently deducted on a per-paycheck basis. If you’re the type that does the math to figure out when you can max out your 401k or if you have multiple 401ks you contribute to in the same year (switch jobs), this is an extra hiccup to be aware of. Likewise with PTO that accrues by the pay period or week.
If you are paid monthly, or semi-monthly this doesn’t apply to you. If you are paid weekly, your “leap year” happens every 5 or 6 years. The cycle also depends on what day of the week you close your pay period/issue checks and how you deal with payday holidays. I believe 2015 is only a leap year if your pay period ends on Sunday. This doesn’t mean you’ll get more checks in 2015, but you will work for 27 pay periods in 2015.
Due to the varying ways that biweekly paychecks can be calculated, not everyone will have an extra check in 2015. Some may experience it the next year, or some may have even had it this year already. In any case, it’s worth checking with your employer every year to determine your pay schedule so you can plan your benefits accordingly.
Photo by 401(k) Calculator.