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A pay period is a recurring time frame during which an employee's work hours are recorded and paid. The period's duration determines how often employees receive wages and how HR departments calculate withholdings, benefits, and overtime.

Types of Pay Periods

When managing a workforce, your pay period is the designated time frame during which employees' work hours are recorded and paid.

Choosing the right type is an important decision. It affects your company's cash flow, the amount of work you must do, and your employees' happiness.

Here are the four primary types of pay periods used by businesses today:

• Weekly: Employees receive a paycheck every week (52 times a year). This is common in labor-intensive industries where workers rely on frequent cash flow.
• Bi-Weekly: This is the most popular schedule, where employees are paid every two weeks (26 times a year). It usually results in two "extra" paychecks per year during months with three paydays.
• Semi-Monthly: Pay is distributed exactly twice a month, typically on the 1st and 15th (24 times a year). Accounting departments often prefer this because it aligns perfectly with monthly financial reports.
• Monthly: Employees receive their pay once a month, for a total of 12 times a year. While this is easy for the company to manage, it can make it hard for employees to budget for an entire month.

How to Calculate a Pay Period for Your Team?

Pay periods are essential for managing payroll. A pay period is a set time frame that determines which hours your employees will be paid for.

Example: A bi-weekly pay period could begin on Monday, June 1, and conclude on Sunday, June 14.

After the period ends, wait a few days to check hours and calculate taxes before Payday.

Step 1: Choosing the Divisor

The divisor is the total number of pay periods in a year. For salaried employees, divide their annual salary by this number:

• Weekly: 52 pay periods
• Bi-weekly: Usually 26 pay periods
• Leap-year adjustment: Some years may need 27 pay periods

If you forget to adjust the divisor, you could end up overpaying employees.

Step 2: Workweek vs. Pay Period

A common mistake is to confuse the pay period with overtime rules. Overtime is based on the workweek, not the pay period.

For example, if the pay period is two weeks long and an employee works 50 hours in the first week and 30 hours in the second week, you must pay 10 hours of overtime for the first week, even though the total hours for the pay period are 80.

Step 3: Calculating Gross Pay

Hourly employees: Multiply hours worked at an hourly rate.

Hours worked × Hourly rate

Salaried employees:

Divide the annual salary by the number of pay periods. This ensures consistent paychecks, even in months with more or fewer days.

Annual salary ÷ Number of pay periods

Learn how to calculate pay periods, including start and end dates, divisors, overtime rules, and processing gaps to ensure accurate payroll.

5 Key Factors to Consider When Choosing a Pay Period

When selecting a pay period in 2026, you must balance legal requirements with the financial health of both your company and your staff.

Legal Compliance

When deciding how often to pay your employees, the most essential factor is compliance with the law. Both federal and state laws usually specify how frequently people should be paid. Many states require that hourly or manual laborers be paid on a weekly or biweekly basis. If your team has remote workers, you need to pay attention to the laws in each employee's state, which means using a standard monthly pay schedule could lead to problems.

Administrative Burden

Payroll runs come with bank fees and HR hours, so shorter pay cycles, like weekly payroll, cost more than monthly payroll. Modern automation tools, like Staffviz, make frequent payroll runs much easier to manage. They reduce both time and administrative costs, making weekly or bi-weekly cycles practical for businesses of any size.

Employee Retention and Stress

The frequency of pay can significantly affect employees' financial stability. Waiting 30 days for a paycheck can create cash flow issues, leaving employees anxious about meeting their obligations and managing everyday costs. Providing more regular pay, such as weekly or biweekly, alleviates stress, enhances productivity, and gives a competitive edge in attracting and retaining top talent.

Overtime Calculations

Overtime calculations are governed by the standard seven-day workweek rather than the pay period structure. Weekly and bi-weekly payroll periods align seamlessly with this framework, facilitating straightforward computation of overtime hours. In contrast, semi-monthly or monthly payroll schedules can bisect workweeks, thereby complicate overtime calculations and increasing the risk of payroll processing discrepancies.

Cash Flow Timing

Deciding how often to pay your employees can significantly impact your company's finances. If you pay everyone once a month, you'll have a single, significant expense. On the other hand, if you pay weekly, the costs are spread out, making it easier to manage your money. Picking a payment schedule that aligns with when your business earns money can help ensure you always have enough to pay your team on time.

Make Payroll Easy with StaffViz

Automated Paid Time Tracking

StaffViz logs work as it happens and multiplies hours by each employee's rate, including local taxes, so calculations are automatic and precise.

Handling Unpaid Time

We track breaks, idle time, and unpaid leave separately. This keeps payroll reports clear and ensures employees are paid only for the work they actually do.

One-Click Payroll Export

At the end of each period, timesheets are locked, and data can be exported directly, reducing errors and saving HR time.

Frequently Asked Questions

1. What is the difference between bi-weekly and semi-monthly pay?

Bi-weekly employees are paid every two weeks (26 times a year), often resulting in two months with three paychecks. Semi-monthly employees are paid twice a month (24 times a year), typically on fixed dates like the 1st and 15th.

2. Does a longer pay period affect overtime pay?

No. Under federal law, overtime is calculated based on a fixed 7-day work week. Even if your pay is monthly, you must calculate overtime based on whether the employee exceeds 40 hours in each workweek.

3. How does StaffViz handle overtime across different pay periods?

StaffViz automatically tracks hours based on your defined workweek. Even if your pay ends mid-week, the system keeps overtime calculations separate and accurate, ensuring you stay compliant without manual math.

4. Can StaffViz manage different pay frequencies for different departments?

Yes. StaffViz lets you categorize employees into different groups, so you can pay your hourly contractors weekly while keeping your salaried management on a semi-monthly or monthly schedule.

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Tracy Taylor

I’m Tracey Taylor, a Content Strategist with over 4 years of experience in B2B and SaaS marketing. I’ve worked with companies like StreamlineREI and StaffViz to drive lead generation and business growth. Outside of work, I explore nature, read books, and play games to stay physically and mentally sharp.