Payroll in the US: frequency of salary payments

Payment frequencies in the US (Payroll Schedule or Payroll Frequency) vary and directly influence the financial management of companies and the financial stability of employees. Main frequencies are:

  • Weekly – once a week;
  • Biweekly – every 2 weeks – every 14 days;
  • Semimonthly (biweekly) – every 15 days;
  • Monthly – once a month;

Quarterly – every 3 months;

The U.S. Department of Labor (DOL) establishes some guidelines on payment frequencies. However, specific regulations may vary from state to state. For example, in Florida, state laws may influence the frequency of pay, with some requirements specific to certain industries or types of work.

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Generally, WEEKLY and BIWEEKLY pay frequencies are more common for operational positions. Turnover is higher and frequent pay can be an incentive in these cases.

The SEMIMONTHLY, MONTHLY and QUARTERLY frequencies are more common in management positions or higher salaries, providing a different financial vision and more strategic planning.

Frequency and date of Payroll in the USA

The date of payment is also determined by the company, always following state laws and regulations. Employees need to know the established frequency of their pay already on admission – which can be changed with everyone’s consent and agreement. The variation usually happens in the MONTHLY and SEMIMONTHLY frequencies, as the payment date may not fall on a business day, and the recommendation is to advance the date to the nearest business day.

Determining the Payout Frequency for a business is not a simple decision. It involves financial, legal, and even cultural considerations. It takes into account the company’s financial health, compliance with local regulations, employee needs and even administrative efficiency. Understanding these frequencies is crucial for businesses and employees as it directly impacts cash flow, personal financial planning, and even talent retention.

State Payday Requirements – https://lnkd.in/dcUrZnRP


Written by Adriano Nogueira, Personal Department Analyst at Drummond Advisors

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