Semi-monthly vs Bi-weekly Payroll - doing what is right for your employees.

Written by on Mar 9 2016

My father ran an engineering firm for a long time. As I grew up I learned a lot by watching him and asking questions. This is what he taught me about payroll: Although most companies pay their employees twice a month (usually on the 1st and 15th), one way you can show you care for your people is by paying them every other week instead of twice a month.

Semi-monthly vs Bi-weekly Payroll: What’s the difference?

If you’re paid twice a month you get 24 pay checks a year. If you’re paid every other week you get 26 pay checks a year. There are two months where you get three pay checks! That’s so huge, I’ll repeat it: Two extra paychecks a year.

Since we all budget for two pay checks a month that means that twice a year we can all take a full pay check and put it right into savings.

At LessEverything we make this one better. We calculate the annual healthcare amount for each employee and amortize it over 24 pay periods. This means that those two extra pay checks are even bigger than an average pay check because there is no healthcare deduction.

Helping Employees Save Money

I know what you’re thinking: “But Steven, it’s not like we’re paying our people any more, they just get less in each of the 26 checks than they would in 24 checks.” Yes, that’s 100% correct, but so what? We all budget for a monthly amount, so it just means we budget a little bit less than we would have otherwise; nothin’ wrong with that.

So if you’re not paying your people every other week, change it. Right now, go change it right now. And if you’re working for a company that pays twice a month, forward them this post or have them call me.


Hi I'm Steven,

I wrote the article you're reading... I lead the developers, write music, used to race motorcycles, and help clients find the right features to build on their product.

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