Payday frequency

[GORDON]

(free) Broadcast TV on as background noise.

I've heard a commercial a few times, without ever glancing at the screen or paying much attention. Seems to be some form of advance payday-loan type thing. I don't know.

The tagline is, "Why do I have to wait for when THEY say my payday is? With *product* I decide when my payday is."

At first, my thought was "that is so dumb, stupid kids don't know how paydays work."

But I thought a little more about it, and I was like, hmmm. We no longer require an accounting department to run payday every two weeks, in a batch, in fact it's often outsourced. No one is cutting checks. It's all computerized.

Back in the Marines, for a time I was the single payroll clerk for 300 Marines. I data-entried when they joined our unit (it was the cusp of checks/direct deposit, we still had some checks to cut and if they weren't joined with our unit officially I couldn't cut the checks), promotions (affected rate of pay), punishments (often pay forfeiture was a punishment), tax deductions federal, state, and local, depending on their home of record (the entire country, there was a thick manual just for that), and the big thing was allotments. Money to dependents (they get their own check mailed or direct deposit/voluntary unless court (or command) ordered, heh), and frequently local used car lots. They often required an allotment be set up with proof directly to them so they could sell the 18 year old Marine a used Camaro with 76k miles at 19%, and ensure they get their money. That and more were things I was personally responsible for doing, alone. I had daily contact with a Captain who had to sign off on my reports, before I could transmit data.

My point is... I could handle pay for 300 people, at the age of 21 and without any kind of accounting degree, and it still wasn't a 40 hours per week job. My suggestion being that civilian can easily handle as many employees each. And this is all computerized now, no one gets a check cut.

So why isn't pay sent to your account every day you work?

My cynical answer is the company likes making their 4% interest for two weeks they have your pay in the savings account. But is there another reason? Why shouldn't we get paid every day, if it's just an automated, electronic transfer?

[TheCatt]

So why isn't pay sent to your account every day you work?

Why have 10x the transactions? Why move cash around more than you need to?

You could always be a stripper

Why shouldn't we get paid every day, if it's just an automated, electronic transfer?

I think it's largely tradition, and processes built up around it. But each paycheck also means: 1) making sure cash is in the right account, 2) withholding Social Security, 3) withholding Medicare/Medicaid, 4) withholding federal income tax, 5) withholding state income tax, 6) misc deductions and contributions (healthcare, dental, vision, 401k, other plans, etc).

If someone gets paid each day, how does that work with weekends? What if they work weekends (hourly)? I think a lot of the deductions (outside of taxes) are based on time, not payments, so time-based payouts are easier to math/process.

[GORDON]

1) making sure cash is in the right account, 2) withholding Social Security, 3) withholding Medicare/Medicaid, 4) withholding federal income tax, 5) withholding state income tax, 6) misc deductions and contributions (healthcare, dental, vision, 401k, other plans, etc).

How do any of these things require any work aside from the initial setting-up of the employee? The computer does it all.

[GORDON]

If someone gets paid each day, how does that work with weekends? What if they work weekends (hourly)? I think a lot of the deductions (outside of taxes) are based on time, not payments, so time-based payouts are easier to math/process.

I still don't see a reason why computers can't do this daily, within minutes of an employee clocking out (when they are owed for work), or at midnight for the salary peeps.

[GORDON]

Why have 10x the transactions? Why move cash around more than you need to?

Because there's an argument to be made that if you worked today, you are owed today, and what is the point of holding it for two weeks if there's literally no additional work for a computer to pay you every day?

[GORDON]

The only good argument against it I can think of is if the banking institutions charge you per money transfer. Then every 2 weeks is 14x cheaper than every day.

But otherwise.... I can't think of any actual good reason why you couldn't be paid for your labor, every day you labor.

And I haven't thought back on my payroll days in a long time, I'm beginning to wonder if some accounting/payroll departments are really padded.