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Discover what biweekly payroll is, how it compares to semi-monthly, and the pros, cons, and compliance tips for managing your payroll calendar effectively.
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Payroll may seem like a routine task, but how often you pay your employees can significantly affect your cash flow, compliance strategy, and employee satisfaction. One of the most common pay frequencies is biweekly payroll, used by thousands of businesses across North America.
But what is biweekly payroll, and how does it compare to semi-monthly or other payroll schedules? More importantly, is it the right choice for your business?
In this guide, we’ll break down everything you need to know about biweekly payroll, including how it works, its pros and cons, how it compares to semi-monthly payroll, and how to manage your payroll calendar effectively.
Biweekly payroll means paying your employees every other week, typically on the same weekday, such as every other Friday. This pay schedule results in 26 pay periods per year, and occasionally 27, depending on how the calendar falls.
It’s particularly popular for organizations with hourly employees or variable schedules, as it aligns easily with weekly time tracking and overtime rules.
Let’s say your first pay date is January 5. Under a biweekly system, your following few pay dates would be:
The fixed weekday makes the schedule easier to follow and less prone to confusion compared to fixed-date systems, such as semi-monthly payroll.
Managing a payroll calendar is essential for keeping operations running smoothly. A payroll calendar outlines:
For biweekly payroll, most years have 26 pay periods, but every 11 years or so, a year may include 27 due to the way dates fall.
At first glance, biweekly and semi-monthly payroll schedules may seem interchangeable—they both issue pay roughly twice a month. However, they differ in several key ways:
When comparing biweekly and semi-monthly pay periods, it often comes down to the type of workforce you have. Hourly workers usually benefit from biweekly paychecks, while salaried staff may align better with semi-monthly paychecks.
Biweekly pay aligns with a 40-hour workweek. This structure makes it easier to calculate overtime pay for hourly workers, ensuring compliance with the Fair Labor Standards Act (FLSA) regulations.
Employees are paid on the same day of the week, typically Friday. This consistency improves financial planning for both staff and finance teams.
Many employees prefer more frequent pay. Biweekly payroll gives them 26 opportunities (instead of 24) to get paid each year, improving morale and cash flow.
Compared to weekly payroll, biweekly payroll cuts down on processing fees and administrative time—especially beneficial for small to medium-sized businesses.
If your company operates in industries like retail, healthcare, or manufacturing, biweekly payroll fits well with the ebb and flow of shift-based schedules.
With 26 or 27 pay periods, biweekly payroll can create inconsistencies in monthly budgeting, especially when it comes to benefits and accruals.
Example:
Health benefits may be calculated monthly, meaning you need to prorate or spread deductions across 24 periods rather than 26.
Two months out of the year may have three paydays. While this may be exciting for employees, it can strain your cash flow if you're not prepared.
If payday lands on a holiday or weekend, you’ll need to process payroll early. This requires advanced planning and fast coordination with your payroll provider or bank.
Companies with mixed payroll frequencies (e.g., salaried on a semi-monthly basis, hourly on a biweekly basis) may face additional complexity in reconciliation and reporting.
While biweekly payroll offers many practical benefits, it also impacts areas such as:
More frequent payments mean funds must be available more often. Companies must closely monitor cash flow, particularly during 3-paycheck months.
Biweekly payroll helps employers stay compliant with state and federal pay laws, especially for non-exempt employees. But make sure your state-specific regulations allow for biweekly pay schedules.
With more pay periods, payroll taxes may be filed more frequently. Your accounting team or payroll provider must be equipped to handle these filings efficiently.
Choosing a payroll frequency is about more than convenience. It’s a strategic decision influenced by:
Biweekly payroll is especially effective for:
On the other hand, if your organization is focused on high-salary professional services, fixed compensation, or precise monthly budgeting, semi-monthly or monthly payroll may be more efficient.
Understanding what biweekly payroll is and how it compares to other pay schedules gives you a decisive advantage when it comes to aligning HR practices with business goals.
For many organizations, biweekly payroll strikes a balance between employee satisfaction, compliance, and operational control. But it requires proper planning, accurate tracking, and the right tools, particularly when managing cash flow, benefit deductions, and year-end reconciliations.
No matter which route you choose—bi weekly vs semi monthly or otherwise—your payroll frequency decision will directly influence employee trust, retention, and financial stability.
If you’re unsure whether biweekly payroll is the best fit—or if your current system is making things more complicated than they need to be—Outsail is here to help.
We offer free, unbiased consultations to help you evaluate payroll providers based on your unique business needs.
Whether you manage hourly workers, salaried teams, or a hybrid setup, we’ll match you with the proper payroll and HR software to streamline your operations, ensure compliance, and boost employee satisfaction.
Schedule your free Outsail payroll consultation today and take the guesswork out of choosing a system that works for you.
