Update: My Paychecks Make No Sense

Mon, Oct 24, 2011

career, debt, goals, income, work

When I wasn’t crying, worrying, chain-smoking, or sleeping over the weekend, I spent a lot of time with my paycheck stubs, blowing up my coworkers’ phones. (Did you miss the story of the crisis I’m dealing with? You can read the first part here.)

For those of you who are interested, I’ll try to explain what I found out. If you’re over my job situation, check back on Wednesday for a post that may not won’t be such a pathetic whinefest. I’ll warn you ahead of time - this post is LONG and confusing.

I was told there would be no math.

When this was just a part-time job, I made $38 per billed hour and it was paid to me as a flat rate on my paycheck. I assumed it would be the same when I switched to full time.

I am supposed to be paid $42 for every hour I bill for therapy (it was less before because it was a second job within the company). To be considered a full-time employee, I am supposed to bill a minimum of 23 hours every two weeks. Those are the only pieces of information I was given prior to switching jobs, and I thought that was all I needed to know. If I ONLY billed the 23 hours, I should have grossed $966 before taxes. And obviously I’ve been billing much more than that. Yet my paychecks have sucked.

For whatever bullshit reason that no one can explain, my paycheck shows two pay rates. One is $11.38 an hour, which is multiplied by the number of hours I was clocked in during the pay period. The other is a flat rate that varies based on my billing.

When I took this job, NO ONE mentioned the fact that we are expected to be clocked in for 40 hours a week. But apparently we are supposed to bill 23 hours a pay period AND be on the clock for 80 hours to qualify for the “base salary” of $910.40, which is $11.38 X 80. (Stay with me, this gets ridiculously complicated.)

If I bill 35 hours in a pay period and I work 80 hours, 23 of those hours would apply toward the base salary of $910.40. The other 12 would be paid to me at $42 each, so the flat rate on my check stub should show $504. My paycheck would be $1414.40 before taxes.

If, however, I bill 35 hours and I’m only clocked in for 68 hours, the 12 missing hours are subtracted from my billing. (This makes no sense because hours on the clock should have nothing to do with the hours that I spent providing therapy. But this is what they do.) So I’m getting $11.38 X the 68 hours on the clock = $773.84. THEN they are only counting 23 hours of billing, so I’m right at the required 23 and I get nothing toward my flat rate. My entire paycheck is $773.84. Then they take out taxes and benefits.

Um, WTF?

If you made it through that, you’re either really bored or really weird. Because it would put me to sleep if it wasn’t preventing me from paying my bills.

Anyway, this whole time I’ve been keeping up with my number of billed hours, thinking they were just multiplying them by $42 and paying me. When I saw the weird $11.38 thing on my pay stub, I talked to the director of the finance department, who spent a lot of time trying to explain it to me. But basically, he doesn’t get it either. Some kind of regulation says that we are supposed to be paid an hourly rate because we are employed by a community mental health center and not in private practice. He assured me that it basically evens out - if you divide $910.40 by 23 billed hours, you get $39.58, which is reasonably close to what I’m supposed to make. I have no idea where the other $2.42 goes.

The problem is, nobody told me about this complicated BS formula. No one told me I needed to work 40 hours a week to earn a base salary - I didn’t even know such a thing existed! And even once I knew about it, I still didn’t realize I was being penalized for time off the clock. I don’t understand why it matters how many hours I’m clocked in when this is supposed to be a billable hour position.

Over the weekend, talking to the therapists who have been there for awhile, I realized that I’ve been completely out of the loop. And it pisses me off that I had to chase down this information instead of finding out when I was offered the full-time position.

This isn’t complicated enough. Here’s some more!

As I’ve mentioned before, my pay also fluctuates based on the number of clients I see who don’t have insurance coverage. Their visits are subsidized (at a much lower rate) by the Department of Mental Health (DMH for short) and I can only see so many clients per pay period.

I am assigned 25 DMH units per pay period. A unit is 15 minutes, so that means I can spend 6 hours and 15 minutes every 2 weeks seeing people without insurance. Luckily most of my time at work is spent at a school, where almost all the kids have Medicaid. Out of the 20 hours I spend seeing adults in the clinic, though, probably 15 of those appointments are people with no insurance.

Once I go beyond the 6 hours and 15 minutes allotted to me, I’m not getting paid for DMH clients. If I bill 35 hours and 10 of them are DMH, only 6.25 count. So in actuality, it’s like I only billed 31.25 hours.

Now that I know all this, here’s the plan.

Today is the beginning of a new pay period, so I’m doing an experiment. Today and tomorrow I’ll be working 10 hours. Wednesday and Thursday I’ll work 8 hours. And Friday I’ll be going to school for half a day, even though that’s supposed to be my day off. Same schedule next week. That will give me the stupid 80 hours my employer is so obsessed with, even though I’ll likely be spending most of that time twiddling my thumbs.

I’ll get my check for this pay period on November 19. So help me, if I don’t have a normal paycheck that (1) I can figure out using their arbitrary formula, and (2) I can use to actually pay my bills without taking out a payday loan, I will go crazy. Someone may have to restrain me.

November 19 is almost a month from now. And by then, my emergency fund is going to be completely gone and most (if not all) of the available credit on my cards will be used up. If that paycheck isn’t correct, I honestly have no idea how I’ll make it.

This is a tl;dr post if I ever saw one!

I know this is hopelessly boring for most people. And I apologize. But it’s a 911 emergency in my life, and I can’t keep acting like everything is fine when I’m going absolutely nuts.

You guys have no idea how much I appreciate the comments on my last post. I didn’t respond to very many of them because it kills my soul to know that people pity me and my situation. But it does help to know that you guys care enough to offer some encouragement.

I am requesting prayers, thoughts, good karma, or whatever else you can send my way in the next few weeks. If having this information solves my problem, I’ll keep the crappy new schedule and move on with my life. But if it doesn’t? Well, I can’t even think that far ahead because I’ll have a nervous breakdown. We’ll see how it goes.

48 Responses to “Update: My Paychecks Make No Sense”

  1. Bogofdebt says:

    I would just like to say that I don't pity you.  Pity is the wrong word.  I feel sympathy for your situation but  I feel that you are going to come through this and be all the more stronger for it.  I'm still sending good thoughts toward your way! 

  2. Vanessa says:

    This is sort of like when I used to be a telemarketer and we were paid 8$ an hour plus commission — until our commission amount went over our base salary and then we had to repay our 8$ salary… I'm very upset for your situation — if nobody explained the pay system to you, no wonder you're confused!

    Perhaps while you're "twittling your thumbs" this week you could blog? That way you could get your 40h and not be wasting your time

  3. Dave Hilton says:

     Keep in mind that you can always file a claim with the Department of Labor if you think your employer is not paying your properly. http://www.dol.gov/whd/flsa/

  4. Tanner E says:

    Ok, I did tag along with that formula. I'm a visual person, so the excel formula for it is VERY complicated (I can put it together for you if it'd help!). I have tons of questions (and wont bother you with them), but still, it doesn't sound legal to me. Do you have any handbook documents explaining this?
    Don't despair! It's sucky to the max, and it is very complicated. Avoid payday loans at all costs, especially if you are foreseeing that your paycheck will be as screwed up. Talk to any friends/family you think can provide a better loan, and as you said, it is a 911 moment for you. If this works out, will that put you ahead (salary wise) or at the same rate as before? Trying to gauge how quickly you can rebuild your EF and so on… I can't offer enough thoughts and good karma your way, but know that there is always a plan B. Even if this coming check comes out to be screwy, know that there will be a way out, and it might not make itself known until the situation is upon you.
    I wouldn’t go another week without verifying. If I were you, I'd call the HR department/payroll and settle that with them. If that's not available, talk to that finance person again and present to them the situation. Tell them exactly what you told us you plan to do (work X hours on Mon-Fri, then however many billable hours) and ask them how much that would give you in gross income. I find it extremely ridiculous they can’t explain this to you in common sense terms.
    Over all, stay calm. Yes, I know you want to slap people who tell you to stay calm with a trout, but by stressing yourself out further, you are digging yourself INTO the hole and not out. Break down if you have to (since it is a very good stress reliever/flush), but keep your mind in task afterwards. Plan for the worst, hope for the best. Keep us informed!

    • I normally bill about 25 hours a week, so my income should increase substantially if they don't come up with some other way to take money away. And if I can keep my DMH units under control. My employer has been reported to the Dept of Labor numerous times, but the people who make the reports usually wind up losing their jobs somehow. So that's not a route I'm willing to take. We'll see how it goes I guess!

  5. Jeffrey Trull says:

    That's pretty ridiculous. And they can't do anything to pay you back even though they messed up by not explaining these policies to you?

    Hang in there, Andrea. Sounds like you're almost out of this mess.

  6. PKamp3 says:

    <- Weird.  My question: were you still snubbed on your last paycheck, or did they just even it out so you were paid the 'correct amount' over 80 hours?  If you were, will that come to you eventually?

    It does sound like you have it handled now - which is great because you won't have to figure this out *and* pound the pavement looking for something PT as well.

    • I'm not sure I understand the question. The paycheck I got on Saturday was abysmal; the only backpay I'll receive is for billing that didn't get entered into the system on time, but that will take a few months.
      As far as the billing I didn't get paid for as a penalty for not working 80 hours in a pay period, I don't get that back. And since I don't accrue sick or vacation time, I'll deal with that continually every time I take a day off. So even if this helps, I need to find another job. Too many variables for this to be worth all the hassle.

  7. Lisa Michnick says:

    I don't pity you. I ADMIRE you. You WILL survive, become wise, and thrive. Perhaps you'd like your job more if your money situation weren't stressing you. Don't criticize yourself. You are a good person.

    • So sorry about your situation, Lisa. Don't be ashamed if bankruptcy is the road you're forced to choose - I've been there, and it sucks, but it's a nice feeling to know that all those stupid debts are wiped out and you can start over. I don't have the amount of debt I used to, but I have enough expenses to make this painful. I'll second your hope that we don't meet in a homeless shelter - that was a much needed laugh!

  8. JT says:

    After this explanation, this seems like the best job ever.  As long as you sit around for the remaining hours per week, your pay should explode.  Why would you want a different position?  They're going to hook you up fat for doing nothing but showing up, but of course the downside is that they'll screw you if you don't.  

    I don't know, but this seems like the best gig in the world.  

    • I am cracking up. Because I read all that and feel like its the worst job in the world - at least, when I compare it to what I thought in the beginning. Why should I have to waste time sitting in the clinic if my appointments don't show up? Why should I be penalized if I had decent billing, then got sick and missed two days? To me, the billed hours are the important thing. If I bust ass and bill 60 hours, I feel I should be paid for 60 hours.

      • JT says:

        Assuming you meet your 80 hours per week requirement, is there a ceiling on the number of billable hours you have at the billed hourly rate?

        • Not necessarily. I'm at school around 4-5 hours a day (I always bill at least 3.5) and I have 12 clinic hours a week. Of course I can't depend on my adult clients to show up - yesterday none of the four I had scheduled kept their appointments - so I try to count on school only and think of clinic appointments as extra.

  9. Carrie Smith says:

    When the people in the finance department don't really understand what's going on, that's definitely a red flag. I would be super upset if they didn't disclose this weird pay stuff to me in the beginning. 

    Honestly, I'd probably go back to doing it part-time and getting paychecks that make sense. Then find some other boring but steady side job, or really up the volume on your writing. You're a fantastic writer.

  10. Dr. Jason Cabler says:

    You might think about finding an employer that is more forthright with how they do things.  There is no reason for a pay scheme to be so complicated.  Sounds like they got an overly qualified accountant to figure out a "perfect" system for paying therapists.  Maybe it works from a money standpoint, but I bet they lose people because of it. 

  11. Ashley @ Money Talks says:

    I'd look for a new job too if I were you.  that's a very complicated way of doing things and you don't deserve it.   I'm glad you got it figured out at least so you can start making enough money to pay the bills but someone should have explained it and the way they handled it is wrong.  You can find an more honest and straighforward employer. 

    • Shannyn @frugalbeaut says:

      AMEN ASHLEY!  I think she should do her own thing because she's awesome and has a knack for helping people with their problems *cough cough me cough*

  12. Shannyn @frugalbeaut says:

    Holy crap that WAS complicated. Good God, having to figure that crap out is enough stress in itself not to mention the fact that the math itself is what's screwing you over UGH….something like this can happen to anyone, I often wonder what I'm overlooking financially that could totally cause distress and shake up my stability.  Trust me, there's plenty of prayers, good karma and lots of #bewbage good juju coming your way. 

  13. judy says:

    I have read this post four times and the math still confuses me.  I am sending you good thoughts and prayers and I hope this works out.  What a bungled way to do payroll.


  14. Rosa sanchez says:

    I am sorry you are having such problems at work.  Don't lose hope because I'm sure things will start looking up for you.   You are a good person and also someone that has been able to withstand other problems.  You are brave and good.  things will work out, you'll see.  :)

  15. Jackie says:

    Hah, I just recently learned what tl;dr means

    But I read your post, and I hope things are all straightened out and understandable for your next check. Is there any chance of them going back and giving you back pay for the past?  Since the method was not explained and you did work the hours they subtracted?

    • Nope. I was supposed to absorb all the nitpicky details via osmosis, so I won't get any of the money back. Ignorance is no excuse as far as they're concerned. It's the most dysfunctional place I've ever worked.

  16. Mikhaila says:

    I am sending all my good vibes your way so hopefully your experiment works out. I think you have a good plan, and system set up and now comes the hard part… Waiting to see if it all pans out. And you have a stellar community behind you, judging from previous comments. I'm rooting for you!

  17. Travis Pizel says:

    I'm impressed that you finally found someone (or found the information) to explain their pay system to you.  Somehow I knew you wouldn't give up until you solved that riddle.  Now that you know what it is…milk it for all it's worth - hell, get a second job and clock in while you're "on the clock" for that job and get paid double time.  Find a way to give them the middle finger and stick it back at 'em.

  18. Insomniac Lab Rat says:

    Yikes…I followed the math, but I don't understand the logic either. I think it's pretty shady that they didn't give you this information more clearly up front.

    This might not be helpful, but you liked this job so much for a while, right? So if you start getting the paychecks that you deserve by spending more time twiddling your thumbs, will this job be half-way decent? It definitely sucks that you can't take off time without losing pay…but do you still enjoy the actual work? I don't mean to sound…insensitive? or something… but it seems like in the future, spending extra time sitting at work (as long as you can make it work with being home for your son) would be a small price to pay for a job you actually like. Of course, that doesn't change the fact that you haven't been paid fairly for the work you've done. I'm just trying to see whatever bright side there might be here.

    Anyway, sending you prayers, good thoughts, AND good karma, you can do this!

    • I really don't like what I do. I love the freedom and the schedule, as well as the lack of micromanaging, but I am SO burned out on therapy. Now that I know I can't come and go as I please, I like the job much less. I feel like a spoiled brat saying that when so many people don't even have jobs, but I've never functioned well working for someone else.

      • Insomniac Lab Rat says:

        Oooh gotcha. Yeah, flexibility in hours and not being directly supervised at all times are the highlights of my "job" right now. Well, I hope something better comes along!

  19. Guest says:

    That's a very crappy situation to be in.  Sorry for stating the obvious.  It's horrible that you have to research this instead on someone coming out and telling you honestly how it all worked.  I hope it all works out for you.  I am sending all the good karma I have your way.  Hope it helps.

  20. April Stotler says:

    Ick. Math. Bleck.

    I don't understand one bit of what is going on in terms of there f*cked up pay system. Here is what I do know: Books are awesome. Bring some with you to work. Also, NaNoWriMo is coming up this month so maybe these hours of boredom that you are going to spend clocked in at work will give you a chance to work on one?
    The whole thing sucks but I'm so impressed that you had the ovaries to say, "Guys, shit is not smelling right" instead of lying or pretending or running away from it. I deal with anxiety on a daily and sometimes hourly basis. I find it really difficult to admit when I'm wrong or to just ask for help. I use lies and fleeing as a coping mechanism and the fact that you DIDN'T do that is amazingly awesome. Good luck Andrea. You can do this.

  21. Jocelyn says:

    Hang in there!  It sounds like you did all your research regarding the hours you need to bill.
    Sending good thoughts your way, and looking forward to reading your post next month telling us everything worked out!

  22. Alysa (a-lee-sah) Se says:

    Thinking of you Andrea, this situation is so frustrating even to read about. I think you're being very hard on yourself for switching jobs. In both posts you've talked about how stupid you were for switching but let's be honest, you made the best decision you could with the information you had! In fact, you made this decision because it was going to be flexible and provide a stead income without killing you like your on/call 24/7 job. You could have never known that there was bizarre fine print that even the finance guy didn't understand. Keep your chin up, things will get better and there's no shame in sending out an SOS. You're a strong woman and we're inspired by you over at ImpulseSave! 

  23. Red says:

    Andrea, just wanted to leave a comment and let you know I'll be sending good vibes/thoughts your way. I know you'll pull through this. I don't have any good pieces of advice (this is the craziest method of paying employees I have ever heard of), and I know that telling you to stop berating yourself and stop feeling embarrassed because of our "pity" won't make you actually stop doing those things. But know that, while we all feel some semblance of sympathy for you, we've also been in similar situations (though, in my case, it was for my own stupidity, whereas in your case you did nothing wrong). I admire you for even posting about it in the first place, and I think you'll gain readers and grow as a blogger as a result of this experience, for whatever that's worth. <3

  24. Serendipity Savings says:

    Their pay scale is so confusing. I wanted to say that first. Second of all, I don't pity you, I sympathize with you. It's really frustrating when you don't know whats going on with your pay and they bills are still coming in. Bills and expenses don't stop no matter what. Your plan sounds do able and hopefully will finally net you some pay. I hate to sound like a broken record, but finding a new job right now is tough. Our economy is still crappy and it's not like jobs for certain fields are falling from the sky.

  25. iwantmyhdbflat says:

    Hang in there!!!  Keep this job first but in the meantime just try and see if you can get any other job that comes along.
    Unscrupulous employers should be hung and shot.  I am in middle management, but I'm only pulling in 4h everyday and I'm refusing to hit sales targets because our company has refused to pay our sales team commissions for the past 10 months.  But I won't encourage you to do that of course.

  26. gabeysmom says:

    sounds like my BIL's old job…he got "shop pay", which was crap, "dive pay", which was good money, and overtime pay.  somehow, he could never hit the benchmarks to get anything he was supposed to get…every time he got overtime, they said they took it to pay his health insurance, and when he didn't get it, they took half of the dive pay for health insurance.  the amounts were always arbitrary.  i believe he filed a case with the state labor board, but never heard anything.
    another semi-related thing is our current debt situation:  one of our kids had a host of medical problems that the insurance wouldn't cover.  2 years, 1 bled savings and 3 maxxed out credit cards later and somebody finally told us that his issues would be covered by medical assistance.  our doctor KNEW we were drowning financially, yet never told us what to do.  without the loophole, we made too much money to qualify.  it's infuriating that people don't tell you the information you need to succeed.  it's almost as if they want  you to fail.

    • That sounds a lot like what I'm dealing with at work. There's always some excuse for why my paychecks are lower than normal.

      Also, I totally agree that people withhold information. So many times in my life, a situation could have been avoided. But people would rather wait until I'm knee deep in bullshit to say, "Oh, you should have done X or Y." REALLY?!?!?!

  27. Marissa says:

    Ok, so I worked in payroll and hr for 3 years and this is probably the most messed pay structure ive seen. I feel for you. My brain hurt looking at it.

  28. Supercoolwondermom says:

    Hang in there….I'm in such a similar place…contemplating doing things I never would have thought of doing before just to get by..I enjoyed reading your posts..November 19th is nearly here-I really hope and pray it will work out for you!

  29. Rebecca says:

    SO what happened I am curious if it all worked out. By the way guess I'm weird but I got what you where say and am using your story to help a friend with her homework. Thank you for you story.


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