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We start bi-weekly pay beginning March 20th. How does this affect the months that have 5 weeks. Do we actually lose two weeks a year? May, July & October have five weeks. Right now I will get $1143.12 every two weeks. I figured it first by the 52 weeks, then divided it by 12 then by two. I come up with $1238.38. Is this correct?

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Are you going every two weeks to twice a month? –  mhoran_psprep Mar 5 at 15:18
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there are 26 fortnights in a year. what is the problem? –  Victor Mar 5 at 15:36
    
@Victor, no there are not, in the same way as a year is NOT 52 weeks long. –  Ian Mar 5 at 15:54
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yes there is 52 weeks plus 1 day, or 26 fortnights plus 1 day. You have got it wrong, no month has 5 weeks, some have 4 weeks and 2 days, some have 4 weeks and 3 days and February has exactly 4 weeks (except in a leap year). So how will being paid fortnightly make you loose 2 weeks a year? You get paid 26 times each year. –  Victor Mar 5 at 16:08
    
Were you weekly before? –  JoeTaxpayer Mar 5 at 18:10

3 Answers 3

Your question is unclear about whether you are moving from bi-weekly payments or to bi-weekly payments. Let's calculate each case.

Bi-weekly pay means you will be paid every two weeks. The amount for each payment will be your annual salary divided by 26, possibly with a small decrease (around 0.3%) to account for the fact that years are slightly longer than 52 weeks (i.e. there are slightly more than 26 two-week periods in a year), and possibly an even smaller adjustment to take account of the fact that some years are a day longer than that. You will be paid literally every 14 days (with some adjustments if a payday falls on a holiday)

If you are going to be paid twice a month, then each payment will be your annual salary divided by 24. Typically you are paid on the same days of each month - for example the 1st and the fifteenth, or the last business day before those.

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Some companies pay based on the number of workdays in the half a month. So the 24 paydays are not uniform. –  mhoran_psprep Mar 5 at 16:47

Biweekly pay for salaried employees is typically calculated as Annual-salary / 26.

Twice a month pay for salaried employees is typically calculated as Annual-salary / 24.

If you were getting paid twice a month and now are getting paid every other week, your paycheck will be roughly ( Twice-a-month-paycheck-amount * 24 / 26 ). If you were paid $1000 twice a month, you'll be paid $923 every other week. $1000 * 24 = $24K and $923 * 26 = $24K.

You will get paid every other week regardless of month boundaries on a biweekly pay cycle.

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One point that I don't see covered in the other answers yet:

How does this affect the months that have 5 weeks. Do we actually lose two weeks a year?

I get paid every two weeks, and pay day is always a Friday. Some months, I get paid 3 times - which is always great. If you live within your means, it's like an extra paycheck. All other months, I get paid two times.

How many months a year do I get paid 3 times? 2. It will always be two, because there are 12 months. If you get paid twice a month, that's 24 pay checks, which is 2 shy of 26 pay checks - what we would expect if we were paid every two weeks. That means those 2 extra pay checks need to fall somewhere, and they will be on the months where your pay day is hit 5 times.

For example, in 2014, there are 4 months with 5 Fridays: Jan May Aug Oct

I got paid the second Friday of January, so I only got 2 checks in January. I will be paid on the first Friday of May, which means I will get 3 checks in May. My other triple-check month this year is October, so of course I am only going to be paid twice in August.

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If your company doesn't change your pay check dates you will get 27 checks in 2021. Those extra days and leap days result in an occasional 27 pay check year. –  mhoran_psprep Mar 5 at 19:53
    
Also remember that, in the US, that third monthly check often does not have health insurance deducted from it. Extra, extra money. –  bryanjonker Mar 5 at 20:00
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@bryanjonker - ??? I've been paid bi-weekly at several companies. In my companies, health insurance has always been deducted "per pay period" (and hence in every check) rather than "per month". Perhaps some companies do it as you suggest, but I don't know of any. –  Joe Strazzere Mar 5 at 20:16
    
The first three companies I worked for had the middle paycheck of a three paycheck month not include health insurance. The last two companies kept the deductions level. –  mhoran_psprep Mar 6 at 4:19
    
The most likely explanation is that the company is paying the insurance company twice a month, and rather than do the complex calculation of working out how much that would be in biweekly payments they just do two deductions a month. –  DJClayworth Mar 11 at 17:54

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