When to Use Bimonthly vs Biweekly Pay Schedules, and Why

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When deciding on company pay frequency, there are a few options to choose from, including bimonthly and biweekly pay schedules. Choosing the right pay schedule for your business will streamline payroll for HR and make pay more predictable and easier to manage for employees.

Bimonthly pay is paid twice per month on specific paydays. Many companies using this pay frequency pay on the 1st and 15th or the 15th and 30th (or the last day) of each month. It’s sometimes called semi-monthly pay.

Biweekly pay is paid every other week on the same day of the week, usually giving employees two paychecks per month, with some months working out to three paychecks. Some companies refer to biweekly pay as getting paid twice a week, but that’s not a common usage of the term.

There are good reasons to choose bimonthly pay over biweekly pay and vice versa, depending on how your company operates. Let’s dig into each of these pay frequencies to compare and contrast their benefits and challenges.

When To Use Bimonthly Pay

Companies operating on a bimonthly financial schedule may find it easier to align their pay frequency with their finances. Bimonthly pay gives two specific dates each month, which don’t change except for the occasional holiday or weekend, making paydays more predictable throughout the year for businesses and workers.

Bimonthly pay also works best for salaried workers rather than hourly, so if your company only has hourly workers, you might want to stick with biweekly pay for now.

How Bimonthly Pay Works

Bimonthly pay provides 24 pay periods every year because companies pay twice per month on the same dates.

Companies using this method pay employees on two days per month, like the 1st and 15th or the 14th and 28th. If a payday falls on a weekend or holiday, some companies pay the business day before the weekend or holiday, while others pay the following business day.

Benefits of Bimonthly Pay

On the employee side of things, bimonthly pay brings bigger paychecks. Employee salary doesn’t increase, but workers get fewer pay periods each year with more money with each check, albeit not often a significant difference for people with moderate salaries.

For HR, bimonthly pay typically results in reduced admin compared to biweekly pay, which has a couple of extra pay periods in the mix. Although the difference in the number of pay periods isn’t huge, having a couple less can add up in large organizations with hundreds of employees when processing payroll and benefits.

Challenges of Bimonthly Pay

In theory, bimonthly paychecks arrive on the same dates each month. In practice, this doesn’t always work. As mentioned, these dates can be interrupted by holidays and weekends more often than biweekly pay.

Companies must have a backup plan, which is usually altering payday to fit around the interrupting day, which negates the usual predictability of bimonthly pay.

Bimonthly pay can also be challenging for HR in regard to hourly workers. Their week-by-week schedule doesn’t jive well with bimonthly pay, which could cut off hours in the middle of the week, depending on pay dates. When overtime is involved, bimonthly payroll might not work at all for hourly employees, although salaried workers aren’t affected.

Special Considerations with Bimonthly Pay

If you use a bimonthly payroll, be sure to have clear guidelines for payment processes when paydays fall on a weekend or holiday. Outline what happens in your employee handbook transparently for employees so there are no questions when a potential delay happens.

Also, if one of your pay dates is at the end of the month, consider defining it as ‘the last day of the month’ rather than a specific date, like the 28th or 30th. This helps you accommodate shorter months while still sticking with a predictable pay schedule.

When To Use Biweekly Pay

Businesses with mostly hourly workers definitely benefit from using biweekly pay, which pays on the same day of the week every other week. The schedules of hourly workers vary from week to week, especially if they have overtime, and biweekly pay aligns well with this week-by-week format.

How Biweekly Pay Works

Biweekly pay gives workers their paycheck on the same day of a pay week, which is usually every Friday. For instance, if you paid workers last Friday, they wouldn’t get a paycheck this Friday but would receive one next Friday. If payday falls on a bank holiday, some companies pay the business day before or the business day after the holiday.

Using this schedule, companies have 26 pay periods per year, adding two more than a bimonthly schedule.

Benefits of Biweekly Pay

On a biweekly pay schedule, some months include an extra payday, giving workers three paychecks instead of two. This can be beneficial for workers who typically live paycheck to paycheck. Employees might also prefer biweekly pay for budgeting purposes, as it provides a specific day for them to expect their pay and manage bills around that income.

For HR, biweekly pay makes calculating hourly workers’ overtime easier compared to bimonthly pay, which doesn’t align smoothly with the typical workweek.

Challenges with Biweekly Pay

The reason employees tend to like biweekly pay is the same reason HR may not love it: the rare three-paycheck month.

Adding an extra paycheck to the month can complicate things in terms of payroll budgeting, but fortunately, they only happen a couple of times per year. Companies should budget for these months ahead of time to account for the extra cash needed for payroll.

If using biweekly pay, be sure to look for a payroll service that charges per month rather than per pay period, or you’ll wind up paying for two extra pay periods per year than with bimonthly pay.

Special Considerations with Biweekly Payroll

If using biweekly pay, be sure to look for a payroll service that charges per month rather than per pay period, or you’ll wind up paying for two extra pay periods per year than with bimonthly pay.

Alternate Definitions of Bimonthly and Biweekly

If you’ve seen the terms bimonthly and biweekly mentioned in emails, on websites, or on podcasts, you might see or hear them referred to differently than I’m referring to them here.

Technically, they can have different meanings. Instead of bimonthly meaning twice per month, it can also mean every other month. Similarly, biweekly can mean twice a week rather than every other week.

Neither one is wrong. They’re even used this way in other circumstances like a magazine getting published bimonthly or an email newsletter getting sent biweekly.

But this isn’t how people in HR typically talk about these payroll frequencies. In HR terms, bimonthly is twice-per-month pay, while biweekly is every-other-week pay.

Other Pay Schedules Besides Bimonthly and Biweekly

Determining pay schedules is as important to a company’s finances as figuring a payroll budget and designing a compensation package.

Bimonthly and biweekly pay aren’t the only two pay frequencies to consider. There’s also weekly, which has the same payday every week, and monthly, which pays on the same date each month.

Weekly pay can become complex for HR, as it requires more frequent payroll processing. On the other hand, monthly pay requires less frequent payroll processing but risks overloading HR at the end of the month.

Depending on your business model and financial periods, these pay frequencies could work better for your company. However, there’s a reason most businesses use biweekly or bimonthly pay, and it’s because they typically offer the most straightforward payroll processing for HR and payments for workers.

Whatever pay schedule you choose, consider using payroll services to help you manage it. They keep your payroll compliant, organized, and automated, allowing HR to spend less time micromanaging payroll.

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