calendar with pay day circled

What’s the most common pay period for employees?

A pay period is the length of time an employee works between paychecks. The most common pay period is biweekly, with 36% of companies choosing it. 32% of companies pay their weekly. Semimonthly and monthly pay periods are less common.

What are the 4 most common pay periods?

1. Biweekly

If you pay your employees biweekly, you’ll pay them once every two weeks. Because there are typically 26 pay periods in the year, you’ll usually pay your team twice a month. Two months out of the year, however, your staff will receive three paychecks.

Biweekly pay periods are preferred by companies with hourly workers because it’s easy to track time worked and calculate overtime.

2. Weekly

If you pay your team weekly, you’ll pay them once a week. Weekly pay periods are preferred by many workers because they’re paid more frequently. But, they can be more expensive because you have to spend time running payroll every week.

Weekly pay periods tend to be popular in trade businesses, like construction or plumbing, because it’s easy to track your employees’ time worked, even if they work vastly different hours each pay period.

3. Semimonthly

If you pay your staff semimonthly, you’ll pay them twice a month. Your accountant would probably prefer you to run payroll semimonthly instead of biweekly because they tend to run reports on a monthly basis.

Semimonthly payroll is easier to run for salaried employees than hourly workers. Your salaried team members will be paid the same amount every paycheck, no matter how many hours they work.

If you pay your hourly staff semimonthly, however, track their overtime worked very carefully to ensure you’re paying them correctly.

4. Monthly

If you pay your employees monthly, you’ll pay them once a month. Monthly pay periods are the least popular option with only 11.3% of companies choosing them.

4 Things to Consider When Choosing a Pay Period

Choosing a pay frequency can be difficult because you have to balance what’s right for your small business with what’s right for your staff. When you’re choosing a pay period, keep these four things in mind:

1. Cost & Time

Choose a pay period that won’t cost too much to run or take too much of your time.

If your payroll software provider lets you run unlimited payrolls without paying extra, then the cost might not be a factor. If your software provider charges per payroll run, however, you will probably want to run payroll less frequently to save some money.

Don’t forget to consider how long it takes you to run payroll because you probably don’t want to spend hours upon hours paying your team.

2. Your Employees

If you primarily have hourly workers, then consider running payroll biweekly or weekly because it will be easier to track their time. If you primarily have salaried employees, then semimonthly or monthly might be the way to go.

3. Cash Flow

Consider your cash flow needs. Make sure you have enough cash on hand to run payroll as frequently as you’d like.

4. State Law

Some states have payroll frequency laws. For example, in Hawaii, you must pay your team at least twice per month. Learn more about your state’s payroll laws.