Your salary itself will not be affected by the change from monthly to biweekly payroll as long as you continue to work your standard 40-hour workweek. However, there are some nuances to consider:
Frequency of Pay: With monthly payroll, you typically receive your salary once a month, usually on a specific date at the end of the month for 12 pay periods. However, with biweekly payroll, you will receive your salary every two weeks, usually on the same day of the week, and that equates to 26 pay periods per year.
Timing of Payments: Transitioning to biweekly payroll means you will receive your paychecks more frequently, which can help with budgeting and cash flow management. However, the amount of each paycheck will be smaller compared to monthly payroll since your annual salary is divided into more pay periods. But also know that your annual compensation will not decrease with this change from exempt to nonexempt as long as you maintain your 40 hours of work time per workweek.
Calculation of Earnings: Your earnings will be calculated differently on biweekly payroll compared to monthly payroll. For example, if you are paid a fixed annual salary, your biweekly paychecks will represent a portion of that salary spread out over 26 pay periods in a year. Monthly pay is defined by 12 pay periods per year.
Adjustments for Overtime: If you are a nonexempt employee eligible for overtime pay, the transition to biweekly payroll affects how your overtime earnings are calculated. Overtime pay is calculated based on the hours worked in a workweek.
Impact on Benefits Deductions: Please note that the monthly cost for benefits will be split over the first and second check of the month for biweekly paid employees. During a month when there are three biweekly pay dates, benefit deductions are not withheld from the last paycheck of the month.
Budgeting Considerations: It is important to adjust your budgeting and financial planning to accommodate the change in pay frequency.
UAB will provide communication about the transition to biweekly payroll, including any changes to pay dates, payroll procedures, and how the transition will affect your earnings. Make sure to review any provided information and reach out to your direct supervisor, departmental HR Partner, or HR Consultant if you have any questions or concerns.