How Many Pay Periods Are in a Year?

Weekly Pay Periods

Staff will be paid on a weekly basis, typically every seven days.

Number of weekly pay periods: 52 weeks ÷ 1 week = 52 pay periods

Characteristics: In a weekly pay period, employees are typically paid every week. The pay period starts on a specific day, such as Monday, and ends seven days later, usually on Sunday. Employees record their hours worked this week, and the employer calculates the wages owed based on the hourly rate or salary. Paychecks are then issued to employees, covering the hours worked that week, most often on Thursday or Friday. When a worker puts in more than 40 hours in a workweek, it's called overtime. 

According to data from the U.S. Bureau of Labor Statistics (BLS) 2020 survey, weekly pay is a typical pay frequency that is more widespread in smaller enterprises. These industries are the ones that use weekly pay the most: construction, manufacturing, trade, transportation, and utilities.

Pros: It pays employees more frequently and helps manage living expenses.

Cons: Increases administrative workload and payroll processing costs.

Related: How many weeks in a month?

Bi-weekly Pay Periods

Employees are paid every two weeks, usually on the same day of the week.

Number of bi-weekly pay periods: 52 weeks ÷ 2 weeks = 26 pay periods

Characteristics: Employees are typically paid every two weeks in a bi-weekly pay period, e.g., every other Friday. They may receive 26 paychecks per year, with each pay period starting on a specific day and ending 14 days later. The paychecks cover the hours worked during the previous two-week period. The length of the pay period remains constant, but the number of workdays in each pay period may vary. In the United States, this is the most typical pay period.

Pros: Strikes a balance between frequency and administrative workload, aligns with some monthly bills.

Cons: It can cause budgeting challenges for some employees due to uneven pay periods.

Semi-monthly Pay Periods

Staff will be paid twice a month, typically on designated days like the 15th and final day of the month.

Number of semi-monthly pay periods: 12 months × 2 = 24 pay periods

Characteristics: Employees are paid twice a month in a semi-monthly pay period, typically on designated days like the 15th and final day of the month. The pay periods are divided evenly throughout the month, with the first pay period covering the 1st through the 15th and the second pay period covering the 16th through the last day of the month. Employees record their hours worked during each pay period, and the employer calculates the wages owed based on the hourly rate or salary. Paychecks are then issued to employees on the designated pay dates.

Pros: Aligns with many financial obligations, such as rent or mortgage payments.

Cons: This can create confusion for employees due to the varying number of workdays in each pay period.

In case you're still not sure on the differences between bi-weekly and semi-monthly, we do expand the answer in a visual way.

Monthly Pay Periods

Workers are paid once a month, usually on the same day each month.

Number of pay periods: 12 pay periods in a year.

Characteristics: In a monthly pay period, employees are typically paid once each month on a clear date, such as the 1st or the last day of the month. The pay period covers the entire month, starting on the first day and ending on the last day. Employees record their hours worked during this period, and the employer calculates the wages owed based on the hourly rate or salary. Paychecks are then issued to employees on the designated pay date, covering the entire month's work. Monthly pay periods provide a longer time frame for tracking and calculating hours worked and wages owed compared to more frequent pay periods.

Pros: Simplifies payroll processing and reduces administrative effort.

Cons: It can create financial challenges for employees who prefer more frequent paychecks.

Biweekly Pay Calendar 2024

Find below an example of a pay schedule for a bi-weekly pay period for the curent year.

FAQ Pay Periods

What is the difference between weekly and bi-weekly pay periods?

The main difference is the frequency of paychecks and the number of pay periods within a year:

• Weekly pay periods occur every week, resulting in 52 pay periods in a year. 
• Bi-weekly ones occur every two weeks, resulting in 26 pay periods per year. 

How do you do the overtime calculation in a two-week pay period?

 In a two-week pay period, overtime is typically calculated based on the total hours worked in a two-week period. If a staff member works more than the standard 40 hours in a week, the additional hours are considered overtime. Overtime pay is 1.5 times the regular hourly rate for each hour worked over 40 a week.

Is it possible to have 27 pay periods in a year?

Yes, a year can contain up to 27 pay periods. In the event that a leap year has an extra day, you might have 27 pay periods if you process payroll every two weeks.

What types of pay periods can employers use?

As an employer, when choosing a pay period for your company, consider factors such as the size of your workforce, payroll processing costs, employee preferences, and cash flow. It's important to comply with local labor laws and regulations regarding pay frequency. Before deciding, assess the administrative burden, cost, and impact on employee financial stability.

What are the key elements to consider when choosing pay periods?

When choosing the right pay period for your employees, consider the following elements: 

• Legal requirements: Ensure compliance with local labor laws and regulations regarding pay frequency.
• Administrative workload: Evaluate the impact on payroll processing, associated costs, and administrative burden.
• Employee preferences: Consider the financial stability and preferences of your employees.
• Cash flow: Assess your company's cash flow to determine if the chosen pay period aligns with your financial capabilities.

Key takeaways about pay periods:

• Pay periods refer to the defined timeframes over which employers calculate and record employee work hours and wages.
• Different types of pay periods include weekly, bi-weekly, semi-monthly, and monthly, each with its own frequency and characteristics.
• Weekly pay periods occur every seven days, while bi-weekly pay periods occur every two weeks. Semi-monthly pay periods happen twice a month, and monthly pay periods occur once a month.
• The choice of pay period depends on factors such as company size, administrative workload, employee preferences, and financial considerations.
• Pay periods impact payroll processing, employee cash flow, and financial planning, so it's important to choose a frequency that aligns with business needs and complies with legal requirements.
• Each pay period has its pros and cons, such as frequency of paychecks, administrative workload, financial stability for employees, and budgeting challenges.
• Overtime calculations typically consider the total hours worked within a pay period and may involve additional pay for hours exceeding the standard workweek.
• It's essential to consider legal requirements, administrative workload, employee preferences, and cash flow when choosing a pay period for your company.
• Weekly pay periods provide more frequent paychecks but require more administrative effort. Bi-weekly and semi-monthly pay periods strike a balance, while monthly pay periods simplify payroll processing but can create financial challenges for employees.
• Pay periods are essential for accurately tracking and compensating employee work hours, managing payroll, and ensuring compliance with labor laws and regulations.