The best payroll schedule depends on your personal preferences, whether you are a salaried or an hourly employee, your industry, your company’s policy, and more. The rule of thumb is to pick semi-monthly if you are a salaried employee and bi-weekly if you are an hourly employee. Gone are the days when payroll tracking was done with a pen and paper. Technology brings us many new ways to automate this process and save time. Here is our list of the best payroll software for small businesses in 2023.

Definition of Biweekly Payroll

For businesses, it can be less expensive to pay employees semi-monthly instead of bi-weekly. In addition to the cost savings, semi-monthly pay makes it easier for businesses to calculate tax and benefits deductions. With semimonthly payroll, you pay accounting services for startups employees on specific dates, such as the 15th and last weekday of each month. As we mentioned above, some states don’t allow businesses to pay employees on a monthly basis. In fact, many states have regulations surrounding the frequency of pay.

• It can be a good idea to start your new hires at the beginning of a pay period — when possible — to alleviate the need to prorate anything.
• Running a semimonthly payroll for hourly employees is more difficult and confusing than doing so for salaried employees, especially when workers earn overtime pay.
• The holidays and weekends coming into the play also create confusion about the payday.
• This may not be the first choice for many organizations, since frequent payroll processing may place an administrative burden on HR and payroll teams.
• For example, 52.9% of employees who work in education and health services are paid biweekly, making biweekly pay more popular than the three other pay schedule variants combined.

What Is a Semi-monthly Payroll?

Our services cover all aspects of your payroll process and payroll tax needs. But what about when you’re at the mercy of English as it’s wielded by others? For, as anyone who pays attention to our work surely recognizes, we are at the mercy of the language.

• However, they may not necessarily fall on the same day of the week, and you would end up paying your employees 24 times in a year instead of 26.
• Bi-weekly payroll is a payment schedule through which employees are paid every two weeks on a particular day of the week.
• If you have a staff meeting every other Wednesday, you will usually have two such meetings per month (i.e., semi-monthly).
• Therefore, this article will discuss the differences between biweekly and semimonthly pay schedules and each’s various advantages.
• In case of holidays or weekends, the payment needs to be done in advance or delayed.
• The frequency of a semi-monthly payment and the consistency of having set days also make it easier for your employees to budget for their personal expenses.

State employment laws surrounding pay periods

The only thing that matters here is the amount in the check and how frequently you get the same. As per the semi-monthly schedule, the employees get 24 checks in a year. Since the number of days in a month varies, some pay checks may be smaller or larger than the others.

Pay Schedule Popularity

• As we mentioned above, some states don’t allow businesses to pay employees on a monthly basis.
• Each month varies in the number of workweeks it contains, impacting semi-monthly pay periods with fluctuating days.
• These are usually fixed dates, such as the 1st and 15th day of the month or the 15th and 30th.
• Semi-monthly and bi-weekly sound like the same thing, but there are some key differences between these two payroll schedules.

We’ve also got a whole library of content on other confusing words and phrases you might see while learning the language. You would think that since there are generally four weeks in every month, these would equal the same thing. Using bi or semi in front of time periods can create tremendous confusion these days as definitions and style guidance https://thesandiegodigest.com/navigating-financial-growth-leveraging-bookkeeping-and-accounting-services-for-startups/ continue to soften and blur. Contrary to popular usage, bi-weekly does not mean twice in the same week. So many speakers and writers use the term this way that there is now widespread confusion regarding the true meaning of the term. When you add these parts together, you get an adverb that means occurring every two weeks or every other week.

Semi-monthly vs. bi-weekly payroll: key differences

The Pros and Cons: Biweekly vs. Semimonthly Payroll

Primary and Caucus: What is the difference?