Sign Up for Discounts
This form does not yet contain any fields.
    Follow us on Facebook
    Controller Library Value Pack
    CFO Library Value Pack
    Accounting Standards Library
    Tuesday
    Jan182011

    What is a bimonthly payroll?

    The term bimonthly means that something occurs once every two months. Therefore, a bimonthly payroll means paying employees once every two months. Since this is not only illegal in many locations, but also an oppressively long pay period, a bimonthly payroll is extremely not recommended! In many locations, the longest allowed payroll period is one month. In the rare situation where a business is actually using a bimonthly payroll, the calculation of pay for each payroll cycle is to divide annual pay by six. Thus, a person earning $120,000 per year will be paid $20,000 in gross wages in each bimonthly payroll.

    It is possible that the term "bimonthly" is being confused with the terms semi-monthly or bi-weekly. Their definitions are:

    • Bi-weekly payroll. This payroll is paid every other week, usually on a Friday. Under this system, there are 26 payrolls per year.
    • Semi-monthly payroll. This payroll is paid twice a month, usually on the 15th and last days of the month. Under this system, there aer 24 payrolls per year.

    Thus, a bimonthly payroll is very likely a term that is being incorrectly used, where the user really means either a bi-weekly payroll or a semi-monthly payroll.

    If there is a choice between implementing a bi-weekly or a semi-monthly payroll, the best practice from an efficiency perspective is to use a semi-monthly payroll, since there are two fewer payrolls to prepare per year. In addition, it is easier to calculate monthly payroll deductions under a semi-monthly system, since there are always two payrolls per month; conversely, there are two months per year in which there are three bi-weekly payrolls, which makes it difficult to handle deductions in the third payroll of the month.

    Related Topics

    How many payroll cycles should I have?
    The work week
    What is payroll?
    What is the difference between a semi-monthly and biweekly payroll?

    PrintView Printer Friendly Version

    EmailEmail Article to Friend

    Reader Comments

    There are no comments for this journal entry. To create a new comment, use the form below.
    Editor Permission Required
    You must have editing permission for this entry in order to post comments.