Summer Pay, Explained

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How would you like it if your employer said "you absolutely have done the work, but I'm not going to be able to be able to finish paying you?" Basically, that is what is happening to teachers in the Detroit Public Schools this week. And to emphasize and publicize this ridiculous predicament, the teachers in Detroit had a sick-out (teacher strikes are as illegal in Michigan as they are here in Massachusetts).CBS News broadcast a story last evening that did not make clear why not paying teachers over the summer months is an ethical as well as practical problem. This morning's Boston Globe did a slightly better job. The issue here is not about paying teachers all year long - it's about paying for services that were completed as of the end of a school year. In other words: deferred or back pay.When the Detroit Public Schools runs out of money on June 30, it will not only mean cancelling Summer School or other educational programs that take place over the 10-week summer break. It will mean that Detroit will break its promise to finish paying teachers for 2015-16.How is that? It most likely works the way things work here in Lowell.  At the beginning of a school year, a teacher can elect to receive contractual salary in one of three ways:

  1. Divide the contracted pay over the 42-week school year,
  2. Divide the contracted pay for the 42-week year over 52 weeks (a calendar year) and receive a lump sum for the balance on week 42, or
  3. Divide the contracted pay for the 42-week year over 52 weeks (deferring a set aside amount so checks arrive regularly over the summer).

Deferring or setting aside part of contracted pay is a convenience and benefit for teachers. When Detroit's funds run out on June 30, the staff that selected Option 1 will have been paid in full for a full year's work. [Updated to include detail from NYTimes article: Detroit uses 44 week year; same principle for options 1 and 3.]. Those teachers who deferred pay (Option 3) will not receive the 10 weeks of deferred salary. So, one group of educators will have received full pay for 2015-16, but another will not. Group 2, no soup for you.I'd be upset too if money that I'd purposefully set aside to live on during a break just vaporized through no fault of my own. I'd expect most employees in any business sector would be as well.Sometimes the devil is in the details.