Setting up payroll functions for your small business requires many decisions that will impact both you and your employees.  Savvy business owners often decide to partner with a payroll provider to make this necessary business task run smoothly and give them back time to dedicate to their businesses and personal lives.

What about setting up a pay schedule? While biweekly and semimonthly schedules are most popular, your individual state laws typically dictate regulations for a minimum pay period; you can always pay more frequently (just not less). 

It’s important to stay mindful of budgeting concerns for your employees when determining their pay frequency. The following general explanations should help you decide which is best.


As its name suggests, setting up a biweekly schedule means your employees will get typically 26 paychecks per year. Note that there are a few months were there’s an extra week, so an extra paycheck. Your employees will become accustomed to the set schedule, making it easier for them to prepare for expenses.


This pay schedule means your employees will get paid twice a month, usually on the 1st and the 15th or the 15th and the 30th day. However, these dates are optional and are ultimately decided by the employer.  If your salaried employees are exempt from overtime pay, this might be a good option. This article from the Department of Labor explains those exemptions.

Accountants usually run their reports on a monthly basis, so this option is (generally speaking) easier for them. Benefits also typically run on a monthly basis, so for your employees who are enrolled in health care options, these deductions may be easier with a semi-monthly pay schedule.


If your staff is made up of mostly hourly employees, this might be your best fit. It allows your employees to have a better handle of cash flow. If the employees have irregular schedules with overtime, the weekly payroll schedule most closely reflects the compensation earned.

This option is not necessarily the most cost-effective, however. A lot of payroll vendors will charge for each payroll run, so running payroll every week could make those fees add up. Not to mention the amount of time it takes to manage the payroll every week.

So, which pay schedule is right for your small business? After ensuring you follow your state guidelines, it really comes down to personal preference and what works best with your current cash flow situation.  

A trusted payroll provider will be able to give you advice on your set up as well. Ready to make the switch to outsourced payroll? Give us a call today or visit our payroll page to fill out a form online! 

Please note that this is not all inclusive. Our guidance is designed only to give general information on the issues actually covered. It is not intended to be a comprehensive summary of all laws which may be applicable to your situation, treat exhaustively the subjects covered, provide legal advice, or render a legal opinion.  Consult your own legal advisor regarding specific application of the information to your own plan.