Small Business Administration

Change from 26 to 12 Pay Periods per year for Civilian Employees

Reduce the administrative cost of processing Time and Attendance as well as Payroll by more than half simply by doing it 12 times per year (monthly) rather than 26 times per year (biweekly).

Each Agency (or large component thereof) would be assigned a Payday (i.e., the 1st, 2nd, 3rd, or 4th Thursday of the month), in which all employees of that Agency (or large component) would be paid. The assignment of Paydays would be done so that approximately the same number of Federal employees would be paid each Payday. This would reduce and smoothe out the impact of the change from 26 to 12 pay periods on the Treasury and on payroll processors like the National Finance Center.

The Military has had 12 pay periods for many years, with good results.

Employees will have little difficulty adjusting to monthly paydays, since mortgage payments, rent, utilities, car payments, and most other major expenses are paid out once a month.

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Idea No. 16199