Employers have several pay period options to consider when compensating their employees. These include weekly, bi-weekly, semi-monthly, and monthly. Each option has pros and cons, and the choice for employers may depend on various factors, including the number and type of employees (full-time, part-time, contract), administrative capability, and compliance with provincial and federal laws.
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What is weekly payroll?
Weekly payroll involves calculating and issuing payments for the total hours worked within a week, including any paid leave. In this model, employees are typically paid on the same weekday, every week, amounting to 52 payments annually. This frequency is higher than all other payment frequencies, with biweekly being 26 payments annually, semi-monthly being 24 payments annually, and monthly being 12 payments annually.
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Learn MoreWeekly payroll benefits to employers
Employers have a number of considerations when deciding on the frequency of payroll:
- Attracting talent:
- Enhanced engagement:
- Payroll management:
- Rectifying mistakes faster:
Highlighting the benefit of weekly pay during the recruitment process can draw in more candidates. It can also help to determine industry standards and what payroll frequency competitors follow. Offering weekly payments may set you apart from other employers.
A weekly pay schedule can motivate employees and boost morale. This may be especially true for those who depend on their paycheque every week. When employees feel that their needs are being met, they are more likely to be engaged with their work, and this, in turn, can create a motivated workforce which is essential for talent retention and overall productivity.
Processing payroll weekly can make the process smoother for both employers and payroll staff. It also ensures employees are clear on when they need to submit their timesheets.
Although payroll administrators aim for accuracy, mistakes can happen. Weekly payroll processing allows for quicker resolution of issues like unrecorded hours or missing compensation. This eliminates the need for extra payroll adjustments, which could incur additional costs for the business.
Weekly payroll benefits to employees
Weekly paycheques can benefit employees in a number of ways, including:
- Quick compensation:
- Consistency:
- Onboarding benefits:
Employees get their earnings promptly with weekly paycheques, which is particularly useful for those who may be living paycheque to paycheque. Employees who work overtime during the week would see their overtime payment reflected within the same week as well. This kind of swift access to earnings can significantly impact employees’ lives.
Weekly pay periods offer more clarity over other payment schedules, making it easier for employees to track when they will be paid. A regular and easy-to-remember payday simplifies financial planning.
New employees benefit by receiving their first paycheck by the next week, avoiding the lengthy wait often associated with starting a new job.
Factors to consider before implementing weekly payroll
When contemplating implementing a weekly payroll schedule for your business, it is important to evaluate several considerations:
Expenses
Managing payroll on a weekly basis may introduce additional administrative and accounting expenses that arise from processing various employee financial transactions, such as loans, garnishments, and salary advances. The complexity and cost can increase depending on the number of employees. However, this can be managed, and the burden of calculations can be reduced by using the right payroll system.
Canadian laws and regulations
Consider using Canada.ca which details regulatory requirements, which are important for compliance and avoiding potential penalties. It also offers tools and calculators that can assist in accurately forecasting the financial implications of moving to a weekly payroll schedule.
Getting started with weekly payroll
Initiating weekly payroll requires meticulous planning and organizing. The steps given below can help in initiating a weekly payroll schedule:
- Adjust employees to the new pay cycle:
Prior to rolling out the weekly payroll schedule, ensure to communicate the process for timesheet submission and approval to employees to avoid delays. Examine the timesheets of all employees and account for any paid leave, such as sick leave or holiday time. Pay special attention to any entries that significantly deviate from typical hours worked by peers. If discrepancies arise, consult with their supervisor to resolve any ambiguities or issues.
- Determine Gross pay:
To calculate the weekly pay, start with gross pay, which is calculated by multiplying the hourly rate by the number of hours worked in the pay period. Consider any overtime worked, for which the overtime rate typically kicks in after 44 hours of work per week, although this can vary by province. The standard overtime rate is 1.5 times the employee's regular hourly rate. Next, consider any statutory holiday pay, for which calculations may vary by province. Additionally, also consider any vacation pay. The minimum vacation pay is 4% of the gross earnings (increasing with the length of employment) in most provinces, but this rate can vary.
- Handling Statutory Deductions:
Beyond calculating pay, account for deductions required by Canadian law, such as Canada Pension Plan (CPP) contributions, Employment Insurance (EI), and income tax. These deductions will vary based on the employee's earnings and other factors.
Frequently asked questions
Is weekly payroll better than biweekly payroll?
The preference for payroll frequency can vary from one employer to another; however, employees generally prefer the weekly payroll schedule. This preference is particularly found among hourly workers, for whom a weekly pay schedule can better match the variability in their week-to-week earnings due to factors like overtime.
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Want to learn more about which payroll schedule would be best for your business? You can benefit from ADP’s payroll solutions by getting help with accurate and timely payroll processing at affordable prices.
Talk to us about your payroll challenges, and we’ll walk you through our solutions — including how companies like yours use them. Call 866-622-8153 or start a quote.
This guide is intended to be used as a starting point in analyzing weekly payroll and is not a comprehensive resource of requirements. It offers practical information concerning the subject matter and is provided with the understanding that ADP is not rendering legal or tax advice or other professional services.
