Working Hours in a Fiscal Year
The number of working hours in any given fiscal year (July 1 – June 30) will be either 2080, 2088, or 2096. This would equate to either 26.0, 26.1, or 26.2 pay periods respectively.
Salaried employees are paid based on their annual salary divided by the number of pay periods in that particular year. The number of hours in a fiscal year may change each July 1, based on the number of regular workdays occurring between July 1 and June 30 of that year. Depending on the number of hours in a fiscal year, the employee's salary may be spread across 2080 hours (26.0 pay periods), 2.088 hours (26.1 pay periods) or 2,096 hours (26.2 pay periods). For a given annual salary, the hourly rate decreases slightly in years with more fiscal-year hours, and increases in years with fewer fiscal-year hours; in all cases, the total amount of gross earnings for the fiscal year remains the same.
- Fiscal year 2019 – 2080 hours or 26.0 pay periods
- Fiscal year 2020 – 2096 hours of 26.2 pay periods
- Fiscal year 2021 – 2088 hours or 26.1 pay periods
Annual Pay ÷ number of pay periods (26.0, 26.1, 26.2) = Biweekly Gross Pay
*Biweekly pay could be calculated based on the number of pay periods instead of workdays in a given year. If NMU calculated bi-weekly pay in this manner the yearly salary would be divided by 26 pays (for most years). However, once every decade or so there are 27 pay days in calendar year which would result in dividing the yearly salary by 27 (causing a much larger decrease in biweekly pay for that year). NMU has opted to divide over 26.X pay periods to ensure relatively consistent bi-weekly pay each year.
*Hourly wage employees who are nonexempt under the Fair Labor Standards Act are not affected by the change each July 1 because they are paid a consistent hourly rate for each hour worked.