Most companies utilize bi weekly or semi-monthly payroll. You may find some companies out there that pay weekly or even monthly, but they are in the minority. Payroll service providers or your own accounting team may advise you on what is best for your company. Here are several straightforward ways to look at the different options for your company With bi-weekly payroll processing of paychecks occurs every two weeks. Usually Friday becomes the typical payday in this scenario. In semi-monthly processing it will usually happen on the first and the 15th or the 15th and the last day of the month. Many times companies will choose semi-monthly because there will be 24 payroll cycles rather than the 26 with bi-weekly. This is good for payroll processors because there are two less payroll posts during the year. Keep in mind that in bi-weekly employees will generally receive the same amount with each check. In a bi-monthly situation their check amounts will vary. You may find that employees favor one time of payment method over another. A second major difference between the two is the way overtime is calculated, or, rather, how difficult it is. Bi-weekly pay cycles always end the Sunday before the cycle so it is fairly consistent. However, in a semi-monthly situation the calculations may need to take place mid-week which will make things more time consuming. If most or many employees in an organization are hourly versus salaried this will also make a differences.
Companies can look to two very specific ways to cut costs with their payroll service. The first is direct deposit. The second is online systems. Both of these, along with the frequency of pay, will help you establish a smooth running payroll operation.
Direct Deposit If checks don’t need to be cut manually a tremendous amount of time is saved. More and more companies offer direct deposit but don’t make it mandatory. If you make direct deposit mandatory then you completely eliminate paper paychecks. Manpower is also cut back and payroll specialists can focus on other payroll tasks. It’s also much more convenient for employees, you don’t have to worry about sensitive information getting lost in the mail and it is much more environmentally friendly. Direct deposit is a win-win situation for everyone.
Online Systems By allowing payroll information to be accessible through online systems, payroll stubs won’t need to be generated by the payroll department. This will again free them up for other tasks. The information is also available much quicker online. It makes it much easier for employees to get their payroll data and to easily verify its accuracy.
Payroll is a very important topic for employees. They want their money to be in their account on time and they don’t want any errors to occur. Companies have many decisions to make regarding payroll. From the type of pay cycle to the pay delivery, systems are getting to be much more efficient. In years to come we will find employees praising their employers for quick and easy access to payroll information and for getting that information to them in a timely manner.
About the Author: Rebecca Beckett is a freelance writer for Innuity. If you would like more information about payroll or Payroll service go to Human Capitol Strategies
