I never thought much about this subject until my company recently changed from weekly to biweekly paychecks. I found through research that about 50 percent of companies pay their employees biweekly while most others pay their employees weekly and some even follow the European trend of paying monthly. Generally, American companies are paying every week or every other week. Let’s look at some of the pros and cons of both systems.
An online survey in the United States found that 43 percent of the work force would prefer a weekly paycheck. Another recent survey of 7,000 workers showed that 47 percent say they live from paycheck to paycheck. One worker, cited on www.moneying.com, put it this way, “I like using the analogy of having one large portion of a favorite food on Sunday vs. having that divided up into smaller portions doled out once a day. I do believe I’d be more apt to gorge myself on that Sunday.” That’s what can sometimes happen when you get two paychecks at once. It may appear to you that you have more than you really do and there is the temptation to “gorge” yourself.
An employee who is accustomed to a weekly paycheck can find the change to biweekly stressful to bear. Costs of everyday products are rising exponentially, and necessities like gasoline and groceries are devouring more of our income. Many people are paying more for their health insurance with co-payments increasing for doctor visits and prescription drugs. Are your paychecks increasing as the cost of living skyrockets? For most of us the answer is no. Couple all this with the reality of this industry. Making countertops usually provides an average to below average income. The reassurance of a weekly supply of money is a safeguard for many. So, why on Earth would a company change to a biweekly pay system?
The main reason is that it saves the company money, in some cases a lot of money. Doing the payroll less, depending on the number of employees you have, could save hundreds to thousands a year. For many companies it enables the office staff to focus more time on other important areas. From a business standpoint it just makes good sense.
Additionally, there are some who like the biweekly system. On the flip side of the coin ,we have this comment from another employee. “Personally, I am comfortable with biweekly paychecks. It actually helped me to learn to regulate my money better than weekly payments ever did.”
As an owner, you might be reading this and thinking, “What’s the big deal? Nobody’s complaining here.” You might not always hear the real story. Most employees don’t want to be known as complainers. They could just be suffering silently. If there is one thing that can affect a company, it’s poor morale and letting resentment build up among employees. It can stop production in its tracks. Nothing can make employees more resentful than feeling they are being treated unfairly regarding their pay.