{"id":141614,"date":"2023-02-28T09:54:57","date_gmt":"2023-02-28T09:54:57","guid":{"rendered":"https:\/\/www.aihr.com\/?post_type=hr-glossary&p=141614"},"modified":"2024-08-27T09:59:01","modified_gmt":"2024-08-27T09:59:01","slug":"biweekly-pay","status":"publish","type":"hr-glossary","link":"https:\/\/www.aihr.com\/hr-glossary\/biweekly-pay\/","title":{"rendered":"Biweekly Pay"},"content":{"rendered":"\n

What is biweekly pay?<\/h2>\n\n\n\n

Biweekly pay is a method of payment where an employee receives their wages every two weeks.<\/p>\n\n\n\n

Each pay period spans 14 days, consistently starting and ending on the same days of the week. This results in approximately 26 pay periods per year, with slight variations due to the calendar year not aligning perfectly with these periods.<\/p>\n\n\n\n

During each 14-day pay period, all hours worked by an employee are recorded and paid out the following week. Overtime is tracked weekly, typically at the start of the pay period.<\/p>\n\n\n\n

How does biweekly pay work?<\/h2>\n\n\n\n

Once the payroll period has ended, the payroll practitioner will determine the total payments each employee is due, as well as any necessary withholdings for state and federal taxes, insurance premiums, or any other applicable deductions.<\/p>\n\n\n\n

Employees then receive their pay by the end of the week following the close of the pay period. As there are 26 biweekly pay periods in a year, there will be two months when employees receive three payments.<\/p>\n\n\n\n

Here\u2019s an example of how a biweekly pay calendar might look:<\/p>\n\n\n\n

\"Calendar\n\t\t\t\n\t\t\t\t\n\t\t\t<\/svg>\n\t\t<\/button><\/figure>\n\n\n\n

What industries use biweekly pay?<\/h2>\n\n\n\n

More than 40% of U.S. businesses<\/a> pay their employees biweekly. According to the\u00a0Department of Labor\u00a0(DOL), these are the industries that most commonly use this schedule:<\/p>\n\n\n\n

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  1. Education and health services<\/strong>: This sector has the highest usage, with over 63%<\/strong> of businesses paying on this schedule. This category includes educational institutions, hospitals, and healthcare providers.<\/li>\n\n\n\n
  2. Leisure and hospitality<\/strong>: Biweekly pay is also very common in this industry, with 54.9%<\/strong> of establishments using this pay frequency. This industry includes hotels, restaurants, and entertainment businesses.<\/li>\n\n\n\n
  3. Professional and business services<\/strong>: Around 42%<\/strong> of firms in this sector, which covers legal, consulting, and other professional services, use a similar pay frequency.<\/li>\n\n\n\n
  4. Financial activities<\/strong>: Approximately 37.4%<\/strong> of businesses in this industry, which includes banks, insurance companies, and real estate firms, utilize biweekly pay schedules.<\/li>\n<\/ol>\n\n\n\n

    How to calculate biweekly pay<\/h2>\n\n\n\n

    To calculate biweekly pay, start by documenting and tracking all hours an employee has worked within the defined start and end times of the pay period. This can be done through timesheets or other tracking methods, such as punch cards or automated systems.<\/p>\n\n\n\n

    Once the hours are recorded, multiply the total hours worked by the employee\u2019s hourly pay rate to determine the regular wages due for that period. If an employee works over 40 hours in a week, calculate the overtime separately, as it is typically paid at a higher rate (time and a half or 1.5 times the regular hourly rate).<\/p>\n\n\n\n

    Calculation example<\/h3>\n\n\n\n

    Suppose an employee earns $20 per hour.<\/p>\n\n\n\n

    Week 1:<\/strong>
    Regular hours: 40 x $20 = $800
    Overtime hours: 10 x ($20 x 1.5) = $300
    Total: $800 + $300 = $1,100

    Week 2:<\/strong>
    Regular hours: 30 x $20 = $600
    Total: $600

    Week 1 + Week 2<\/strong> = $1,100 + $600 = $1,700<\/p>\n\n\n\n

    $1,700<\/strong> is the amount the employee would be paid for the entire two-week period.<\/p>\n\n\n\n

    Semi-monthly versus biweekly pay periods<\/h2>\n\n\n\n

    While biweekly pay means paying employees every two weeks, semi-monthly pay divides each month into two periods, usually from the first through to the 15th and then from the 16th through to the end of the month. <\/p>\n\n\n\n

    However, there is also a variant where the first period is defined from the first through to the midpoint of the month (say, the 14th of February), then from the next day through to the end of the month.<\/p>\n\n\n\n

    In practice, there are 26 biweekly pay periods in a year and 24 semi-monthly pay<\/a> periods.<\/p>\n\n\n\n

    Although manually defining pay periods in this manner may involve more work, it also leads to more consistently sized payments for the employee.<\/p>\n\n\n\n

    If employees frequently work more than 40 hours a week, they may need to be educated on how the overtime week is calculated, as it is always done using the same days of the week<\/a> (e.g., Monday through Sunday) and the calendar days the pay period covers have no bearing on whether they receive overtime pay.<\/p>\n\n\n

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