Closing Payroll Early to Cover Holidays

Employee payroll needs to adhere to a regular payroll schedule. Employers can’t just pay their employees whenever they get paid from their clients and they can’t postpone payroll because they ran into a big expense. However, while you do have to stick to a schedule, you can announce your plans to close payroll early so that employees get a check in time for the holidays.

Payroll Frequency Options

There are several standard payday schedule options. These include:

• Monthly
• Bi-monthly
• Semi-monthly
• Weekly
• Bi-weekly

Which you choose may depend on your state, your employees’ occupations, or your company’s preference.

The frequency of payments is mandated to some degree but the exact dates on which the payments are to be made is not. That’s why closing payroll early in time for a holiday or other special event can work.

Early Payroll for Holidays

A slightly irregular schedule is fine as long as long as the following conditions are met:

1. Pay dates are posted
2. Pay days fall within the required frequency
3. Employees are aware of the payroll schedule in advance

For example, a company in California might have a pay cycle from the 26th to the 10th with pay dates on the 1st and the 15th of each month. Adjusting the payday for an upcoming holiday could be done by making a payment in the week preceding the normal payment.

This is particularly easy to manage with salaried employees since their set pay amount can simply be issued a few days early. With hourly employees there are a couple of options:

• Split the pay cycle so that the pre-holiday check consists of one week’s pay and the following check consists of the second week’s pay (only permissible in some states).
• Forecast the time worked for the days that will be included on the payroll. If the pay cycle ends on the 26th and you want your employees to get paid on the 24th, estimate the hours worked for the few days before the period close. Be careful not to underpay employees, however; this could backfire.

Generally, these changes will be in the employee’s favor. Most people appreciate getting paid before holidays. There is food to buy for Thanksgiving, gifts at Christmas, and road trips during the summer holidays. Advanced cash is usually welcome.

Maintain Pay Period Visibility

Even if your intention is to help out, you don’t want to surprise your employees and disrupt their budgeting. A good way to keep everyone in the loop is to plan ahead and make the pay dates visible. You can plot pay dates on a calendar and post the calendar each year. This way, employees will know way in advance of any irregularities and should be able to arrange appropriate payment dates for their bills. Not only is it nice, but it’s also mandatory in most states.

California Legislative Information:

“Every employer shall keep posted conspicuously at the place of work, if practicable, or otherwise where it can be seen as employees come or go to their places of work, or at the office… a notice specifying the regular pay days and the time and place of payment, in accordance with this article.”

Run Payroll Early

With Timesheets.com you can easily manage early payroll occurrences. You can post the pay dates on the company schedule, add estimated dates, and run payroll reports any time you wish.