Reviewing the semimonthly vs biweekly payroll differences is important for both employers who need an efficient payroll schedule and employees who want a reliable paycheck.<\/p>\n\n\n\n
In accounting, semimonthly payrolls are paid twice each month for a total of 24 paychecks per year. In contrast, with the biweekly schedule, employees receive payments on a fortnightly basis for a total of 26 each year\u2014meaning two months have an extra payment.<\/p>\n\n\n\n
Both the semimonthly and biweekly payment schemes are preferred over the weekly and monthly ones since the former requires employers to spend more accounting resources while the latter means employees have to wait longer between paychecks.<\/p>\n\n\n\n
We explore this topic in detail below!<\/p>\n\n\n\n
Semimonthly pay schedules are those that pay out twice each month<\/strong> regardless of the number of days in a month. Employees receive one payment in the middle of the month (typically the 15th) and the other on the month\u2019s first or last day. Therefore, employees on a semimonthly pay schedule will receive a total of 24 paychecks each year<\/strong> (two for each month). <\/p>\n\n\n\n For this reason, the length of time between checks will vary depending on the month’s length.<\/strong> For instance, while in February, workers would receive a paycheck every 14 days, in months with 31 days, these two periods would increase to 15 and 16 days.<\/p>\n\n\n\n Semimonthly payments are most suitable for salaried employees <\/strong>who are on an organization\u2019s permanent payroll and have little to no overtime in most cases.<\/p>\n\n\n\n Semimonthly pay schedules mostly benefit companies in several regards:<\/p>\n\n\n\n The main problem areas of semimonthly pay are related to hourly employees:<\/p>\n\n\n\n The biweekly payment schedule guarantees one payment every two weeks distributed on the same day<\/strong> of the week (Friday in most cases). Since there are 52 weeks in a year, employees on the biweekly scheme would receive a total of 26 paychecks. <\/strong>Therefore, there would be two months in a year with an \u201cextra\u201d paycheck.<\/strong><\/p>\n\n\n\n Due to the regularity of the paychecks, employees also receive the same amount<\/strong> with each paycheck since they cover the same number of days, which is not always the case with the semimonthly payment plan (some months are longer than others).<\/p>\n\n\n\n Biweekly payment schemes work better with hourly employees<\/strong> with unpredictable work hours and additional obligations, as biweekly pay never splits overtime hours.<\/p>\n\n\n\n Most employees prefer being on a biweekly payment plan for several reasons:<\/p>\n\n\n\n Businesses dislike biweekly payments due to the increased costs and complications:<\/p>\n\n\n\n Ultimately, three key differences separate semimonthly and biweekly payment schemes:<\/p>\n\n\n\n As you can see, both payroll options come with their own pros and cons, which makes them suitable for different scenarios. That said, as a general rule of thumb, the semimonthly system is better for employers<\/strong>, whereas the biweekly one suits employees more.<\/strong><\/p>\n\n\n\n After all, semimonthly payrolls are less complicated to track and calculate, thus, requiring fewer resources. But, incorporating hourly wage workers is rather complicated.<\/p>\n\n\n\n On the other hand, biweekly payments introduce more accounting issues and higher costs, but employees love them as they are regular and offer two \u201cextra\u201d paychecks.<\/p>\n\n\n\n Reviewing the semimonthly vs biweekly payroll differences is important for …<\/p>\nWho Is It Right for?<\/strong><\/h3>\n\n\n\n
Pros of Semimonthly Pay<\/strong><\/h3>\n\n\n\n
\n
Cons of Semimonthly Pay <\/strong><\/h3>\n\n\n\n
\n
What Is a Biweekly Pay Schedule?<\/strong><\/h2>\n\n\n\n
Who Is It Right for?<\/h3>\n\n\n\n
Pros of Biweekly Pay<\/strong><\/h3>\n\n\n\n
\n
Cons of Biweekly Pay<\/strong><\/h3>\n\n\n\n
\n
The Major Differences Summed Up<\/strong><\/h2>\n\n\n\n
\n
Which Is Better Overall?<\/strong><\/h3>\n\n\n\n
Key Takeaways:<\/strong><\/h2>\n\n\n\n
\n