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Determining pay frequency

Determining pay frequency 

You can't pay your people without first determining their pay frequency.

Are you going to pay your employees weekly? Biweekly? Semi-monthly? Monthly? Quarterly?

How often should you be paying your people? How much does it matter?

Okay. No more questions. Let's get to some simple answers.

As an employer, you can determine your pay frequency (for the most part).

Although there are some exceptions, how often you pay your people is up to you.

From your perspective, the more often you pay your people, the more time and money it's going to cost you. There's a pretty big difference between cutting 26 checks over the course of the year compared to cutting 52, whether your outsourcing your payroll processing or doing it in-house.

From your employee's perspective, they're almost always going to want to get paid more frequently. It comes down to cash flow, just as you as a business owner would prefer to get paid sooner and more frequently after performing work for your clients.

You really need to pay attention to state pay day laws. How often you're required to pay not just all of your employees - but certain classifications of workers - varies by state. Some states have very complicated pay day laws. In Arizona, paychecks must be issued no more than 16 days apart, and employees must receive a minimum of two paychecks per month. On the other hand, Michigan's pay day laws are some of the most nonrestrictive, as pay frequency is determined by occupation.

Earlier this year, we featured a variety of articles about pay frequency in New York for different worker classification and pay day requirements, according to New York State Labor Law. You can learn about the laws regarding paying and classifying executive workers, manual workers, and commissioned salespeople.

No two states mandate pay frequency the same way, so it's up to you as the business owner to do your homework. Here's a great resource to check the basic pay day requirements for your state(s).

Do you employ (or plan to employ) both hourly employees and salaried employees? The preference for most business owners would be to pay them differently. (Hourly employees often get paid weekly while salaried employees are more likely to be paid biweekly.) Again, that's fine, as long as your pay schedule complies with your state's pay day laws.

 


If you think you can improve your current pay frequency structure - whether it's for a startup or a mature business - Complete Payroll would be happy to help. Simply fill out this form to get in touch with us and we'd be happy to lend our guidance and support.


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