Choosing When to Pay Employees

As long as you pay your employees, at least as frequently as the period specified by your state’s laws, you’ll be in compliance…

Whether you own a large corporation or a small business, knowing when to pay your employees is an essential part of the management process. In most areas, state law is the only rule you have to be aware of when it comes to determining just how often you need to provide your employees with their wages, although there are many other considerations to take into account when choosing a payday.

Options for Paying Employees

Federal and state laws demand that you pay your employees on a regular basis. However, it is the state law that dictates exactly how often you will need to provide the actual payments and what other rules are involved. The options for paying an employee can be as follows:

• Weekly: normally referring to payments provided on the same day of the week, usually on a Friday.
• Bi-weekly: these payment options are quite common, and they normally involve the employer providing a paycheck once every two weeks, with the amount required either for the previous or the next two weeks.
• Semi-monthly: involving pay days organized twice per month – usually either on the 1 and the 15 or the 15 and the 30 of each month;
• Monthly payments are provided in most cases on the last day of the month.

While you may have to pay your employees at least weekly or monthly – depending on where your business operates – there are no rules saying you can’t pay them more frequently; however, you also need to take into account issues such as payroll expenses, employee preferences and accounting.

Additional Considerations

As long as you pay your employees, at least as frequently as the period specified by your state’s laws, you will be in compliance. However, you also need to choose your payroll options wisely.

You can elect to pay your employees through various means, such as electronic payments, payroll checks and direct deposits. Many companies also choose to use a payroll processing service; however, be advised: in this case, you will need to pay a fee for each paycheck. Finally, it may also be important to choose a system that facilitates straightforward overtime payments.

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