How does a leap year effect employers?
If you’ve looked at the calendar beyond what seems to be a very long January, when I’m writing this, you’ll have seen that 2024 is a leap year. They only come around every four years, and can often prompt questions for employers.
What it means for employers
Workers may ask if they get paid for an extra day in a leap year. It is an extra day, after all, and with it being on a Thursday this year, many will see it as an additional working day. However, the answer isn’t as simple as that though; it all depends on their pay structure.
Hourly paid workers
In the case of an hourly paid worker who has a pay reference period of one week, ie they’re paid weekly, they will not see any actual difference in their pay because the number of days worked in their pay reference period has not changed — a leap day does not mean a seven-day week becomes an eight-day week, so these workers will have worked their usual hours.
When it comes to an hourly paid worker with a pay reference period of one month, ie they’re paid monthly, they will see an increase because the number of days worked in the pay reference period has changed; they will work for 21 days in February rather than the usual 20 days. Therefore, they are owed an extra day’s pay because they have worked an extra day.
Salaried workers will not see any difference in pay because they are paid with reference to the year and not the hours worked. However, for workers who are paid at the National Living / Minimum Wage, it’s worth running a compliance check to make sure there are no breaches around the leap day.
Leap days and key dates
Where employees are paid on the last day of the month, this can mean workers are paid their February pay a day later than is usual, which could have significant consequences, particularly for those living on a tight budget. Employers should therefore decide whether they will still pay on day 28 or follow the contract and pay on day 29. Whichever way is decided upon, it should be confirmed to employees in time for them to put any necessary plans in place.
Statutory sick pay
For employees who go off sick in the final days of February, when processing payroll, the extra day will need to be considered when counting waiting days, which could affect when payment begins.
Deadlines and meetings
Recurring deadlines and meetings are a normal part of working life. They can help with managing employee workloads and making sure important tasks are completed in a timely manner. However, care must be taken to ensure these are not impacted by there being a 29th February this year. Checking in advance can help to avoid any mistakes when the time comes.
Lots of things in employment law operate with reference to a number of days, and employers will need to identify if this will impact any of their employees.
First, employers will need to remember to factor in the extra day in the month when giving someone termination notice in terms of days. Otherwise, it could mean that an individual whose employment is scheduled to end on 1st March, when in fact it should be 29thFebruary, is given an extra day’s pay.
The same applies where employees request annual leave (where the employer requires a certain number of days’ notice), parental leave (which needs 21 days’ notice of the start date of the leave), paternity leave (which must be taken within 56 days of the birth), etc. Day 29 needs to be remembered here otherwise a request could be denied on the basis that correct notice hasn’t been given when it has. Remember also, anything that gives a date range such as “27 February–3 March” is six days, when it would be five in non-leap years.
Many employers won’t be affected by the leap year. However, for those that are, any decisions made relating to this should be communicated to employees in good time to ensure everyone is treated fairly and consistently, and there are no misunderstandings.
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