In the UK, most professional jobs pay monthly. In the USA, it seems most professional jobs get paid every two weeks.
This usually comes as a great shock when someone from one side of the pond finds out how poorly employment conditions are on the other side. Naturally, everyone believes their own way of doing it is superior.
I find it strange that Americans are generally paid fortnightly / biweekly. In the UK salaries and bills are usually monthly.
So, my Twitterino chums - vote in this highly sciencetific poll or leave a reply.
— Terence Eden (@edent) May 25, 2019
Both systems have advantages. The UK way is better for aligning with monthly bills. The US is good for unexpected bills. Read the whole Twitter thread to see what other people think.
But why can't we be paid daily?
When I first started working, my pay packet was - literally - an envelope stuffed with cash at the end of the day. It caused so much hassle to have a bunch of people lining up in the office to physically pick up their money, they moved to automated bank transfer. Because of banking fees, they made that monthly. With much grumbling and discontent.
In the UK, bank transfers are pretty much instant. For personal transfers they're also free. If you're a business, bank transfers cost money - as does the administration of payroll services.
Imagine - once BitCoin has realised its dream of free and fast money transfers 🤣🤣🤣 - that bank payments were also free and instant. What would the advantages be of daily payment?
- Better protection if you quit your job or your employer lets you go. No more hoping they don't screw you over on the final pay-cheque.
- Less variability of getting paid more per-day in February and less in December.
- No need to have an early Christmas payday.
- Leap years get you an extra day of pay!
There are, of course, some disadvantages.
- If you've ever played a game like Universal Paperclips, you'll reach a point where you have to balance your income and outgoings which are constantly fluctuating.
- What if your electricity bills want paying daily? No problem if you've got savings - but if you're living payday-to-payday and it's a pain.
- More opportunities for things to go wrong.
Personally, I get paid on the last day of the month and have all my regular bills come out of the first day of the month. So, for a day, I feel rich! Then I get to see what discretionary spending I have available for the rest of the month.
I could see the advantage of going fortnightly - whether my bills did or not. But I'm on top of my finances and have enough financial discipline not to spend this week's pay when I know there's a bill next week.
Daily pay... I am predisposed to like the idea of instant payments. And it feels like going back to a day's wage for a day's labour ought to be satisfying. But feels like a lot of admin, checking to see if money has arrived every day. Is it dispiriting after a crappy day at the office to see "only" 1/365th of my pay?
Would you want to move to a different payment cycle?