Expert: Mike Wellman - 9/27/2007

Question
I'm about to require mandatory direct deposit of payroll. I currently pay hourly employees bi-weekly and salaried bi-monthly. I want to switch everyone to the same pay period and would like that to be bi-monthly. What is the most painless way to convert those hourly bi-weekly paid employees to a bi-monthly pay period? Unfortunately the hourly employees  are those that tend to live pay check to pay check.

Answer
There is no magic bullet here. The first thing is to make sure they have plenty of notice that it is coming. I would allow at least 60 days. Send out a memo that gives them notice and explains what the affect will be. Advise them to make plans for it. If you do it in a month when their payday only occurs 4 times, it will lessen the impact.

If you give employee advances, you may want to plan on being hit up for more than usual. But they need to understand that their annual compensation will not change except for circumstances in the way paydays fall. It will all be the same in the long run.