Payroll is an important part of getting your small business up and running. Part of the payroll process requires that you select a payroll schedule that determines how frequently your employees will receive their paychecks. Each business is different, so there is not a one-size-fits-all schedule. There are four main schedules, though: weekly, bi-weekly, monthly, and semi-monthly. Keep reading to learn the two most common payroll schedules and how they differ from one another.
Bi-Weekly Payroll Schedule
Bi-weekly is by far the most common payroll schedule that businesses tend to go with. With this particular schedule, businesses pay out 26 times throughout the year. As a general rule, employees will be paid twice per month; however, there are a few months out of the year in which they will be paid three times due to the way the paydays fall.
One of the main reasons that the bi-weekly payroll schedule is so common is that it is easy for everyone—the employees and the employers. With a bi-weekly payroll schedule, employees will be paid on the same day each week, which is every other week. This ensures that employees know when they will be paid. For employers, this schedule requires less time spent dealing with payroll processing each month. As an employer, you can spend that additional time focused on other areas of your business.
Monthly Payroll Schedule
Monthly payroll is not nearly as common as bi-weekly, but it may be more appropriate for your business. With this schedule, your business will send checks to employees once per month on the same exact day. The benefit of this schedule for employers is the little work that is involved in the payroll processing due to the fact that payroll is only processed once per month. However, it is important to ensure you remain organized throughout the month, as it can be easy to lose track of who took sick time, vacation days, etc.
While the monthly payroll schedule may be beneficial for some employers, it may not be so for employees. For instance, budgeting becomes more difficult for those who are getting paid only once per month. Therefore, this may be something to take into consideration as an employer.
Payroll schedules will vary from business to business, and while there are multiple schedules that you can choose from, you will need to sit down and consider the pros and cons of each one as they relate to your individual business needs and goals. For more information, contact a company like Knoxville Staffing Service.