What Is a Pay Period?

A pay period is a length of time that is used to track a professional’s work hours and calculate their compensation. Typically, payroll is processed at the end of a pay period without large delays. These calculations are typically based solely on your team’s standard work hours, but you may have to account for overtime as well if you offer overtime pay.

How many pay periods are there in a year?

The number of yearly pay periods will vary depending on which type of pay period you use at your business. Typically, however, there will be anywhere between 12 and 52 pay periods within each year. Traditional monthly payroll involves 12 pay periods, while weekly pay has 52 pay periods.

What are the different types of pay periods?

There are several different types of pay periods, with the most common ones being:

What is the most common pay period used around the world?

The most common pay period around the world is monthly pay. However, organizations in some regions have adopted bi-weekly payments more broadly, like in North America. This is especially true for public sector employers in the US and Canada, which frequently use biweekly payments instead of monthly pay.

What pay period should you use in your business?

The right pay period for your business should balance the frequency of payments with the resulting transaction fees. You should choose a pay period that provides your staff with a higher payment frequency without resulting in excess costs for your business.

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