Payroll Management Software
9 min read

How to Run Weekly Payroll: Your Step-by-Step Guide

August 24, 2023

Struggling to get your head around weekly payroll?

Whilst making weekly payments has its benefits for both you and your employees, it also comes with its own set of hurdles to jump over.

Below, we'll talk you through everything you need to know about weekly payroll - how it works, use cases and the steps you need to run the process smoothly.


Weekly payroll explained 📝

As its name suggests, weekly payroll is the process of paying employees on a weekly basis, typically every seven days.

This payroll frequency is common for businesses that have a workforce with varying hours and shifts - like part-time or hourly employees.

Running weekly payroll means that employees receive their wages more frequently than other payroll schedules...

You simply calculate and process pay for your employees based on their salary or the hours they've worked.

These calculations will include things like regular hours, overtime, bonuses etc.

Weekly payroll can provide employees with a sense of financial stability, as they receive more frequent payslips. However, it can also come with its own administrative challenges simply due to the more frequent processing and reporting requirements. 

How to work out weekly pay: 9 simple steps to run weekly payroll 🧐

1. Collect employee records

The first step is to gather all the necessary information for each of your employees - their personal information, tax codes, hourly rates etc.

You'll want to double check that you have up-to-date details to avoid any errors.

2. Calculate pay

There are three ways to do this, depending on the sort of contract/hours your employees are on...

Based on hourly rate (for hourly employees)

For hourly paid employees, track their hours worked each week, including regular hours and any overtime.

Make sure you account for any variations in working hours, such as shifts or additional hours worked.

To calculate gross wages, just multiply the hours worked by the respective hourly rates for each employee.

Include any additional payments, such as overtime or bonuses.

This will give you the gross wages for the week.

Convert annual salary (for salaried employees)

To calculate the weekly pay for any employees who are on regular salaries, you'll need to take their annual wage and divide this by the number of weeks in a year (which is 52).

So, if a salaried employee is earning £50,000 per year, their weekly wage would be around £961.53.

3. Calculate deductions

The next step is to calculate deductions for income tax, National Insurance contributions, and pension contributions.

Just make sure to use the correct tax codes and contribution rates provided by HMRC.

4. Work out the net pay

Subtract the deductions from the gross wages to calculate the net pay that each individual employee should receive.

5. Generate payslips

You'll need to create detailed payslips for each of your employees.

Payslips should include information about gross and net pay, deductions, and any additional payments.

6. Review and double check your data

Before completing your payroll process, be sure to review all your calculations, deductions, and payslips to double-check they're accurate and error-free.

7. Pay your employees

Transfer the net pay to your employees' bank accounts.

This can be done through bank transfers or direct deposit, depending on your preferred payment method.

8. Submit real-time information (RTI) reports

Next, you'll need to submit RTI reports to HMRC - which needs to be done using a payroll solution like Pento.

These reports provide information about employee wages, deductions, and tax contributions.

9. Address any employee queries

The more frequent payroll cycles means more employee queries.

So, you'll need to be prepared to address any queries or concerns that your employees might have regarding their wages, deductions, or tax codes.

Want to take hassle out of payroll? Pento was built to automate calculations (no matter what working patterns your employees are on), eliminate errors and take care of all the HMRC reporting and compliance for you.

How many payroll weeks in a year? 🗓

Here in the UK, there are 52 payroll weeks in a year.

Since there are 52 weeks in a year, 1 week = 1 payroll period.

However, please note that some years may have 53 weeks, depending on when your payday falls.

This can happen when the year starts or ends on a Friday or Saturday, causing the extra payroll period.

A few bonus tips if you're paying employees weekly...

Running weekly payroll in the UK can get complex. 

But by investing in the right tools and staying on top of your process, you can streamline your process, reduce errors, and ensure that your employees are always paid accurately and on time, whether they get paid on a weekly or monthly basis.

Choose a reliable payroll software provider: Spending too much time on payroll? It's worth investing in reputable payroll software that can automate calculations, generate payslips and take the hassle out of HMRC compliance.

Be sure to go for a solution that has features like RTI submissions and automatic updates to stay up to date with tax regulations.

Establish clear payroll policies: Clearly define your payroll policies and make sure all employees are aware of them. This includes guidelines on overtime, bonuses, deductions, and payment schedules.

Consistent timekeeping: Implement a reliable timekeeping system to accurately track things like weekly hours as well as irregular overtime. This is crucial for calculating wages, especially for hourly workers.

Stay up to date with any legislation changes:

Regularly check for updates to tax codes, contribution rates, and any other relevant payroll regulations - using payroll software like Pento will do this for you.


Advantages of weekly payroll

Improved accuracy and transparency

Using weekly instead of monthly pay periods will generally mean you can be more accurate and transparent when it comes to tracking hours worked, wages earned, and deductions made.

Having more frequent calculations should reduce the likelihood of any errors or discrepancies.

Easier overtime and bonus calculations

If you're in an industry with varying work hours - like retail or hospitality - a weekly pay frequency will help simplify the calculations you need to make for overtime, bonuses, and shift differentials.

Flexibility for part-time employees

Any part-time or temporary employees who work irregular schedules will benefit from weekly payments since their compensation will be more aligned with their working hours.

Real-time insights

Weekly pay periods will allow you to have a real-time view of your labour costs, helping them make informed decisions regarding staffing and resource allocation.

This is particularly useful if you have seasonal/temporary staff.

More painless record-keeping

With weekly pay, records of hours worked, wages earned, and deductions made are will be much easier to keep up to date, since you'll be making a more manageable volume of changes each time.

Monthly payroll vs weekly payroll 🤔

Whether it makes sense to run payroll weekly or monthly will depend entirely on your specific industry and working patterns.

You'll probably want to account for things like employee expectations, industry norms, cash flow management, and admin capacity when deciding which payroll schedule is most appropriate for you.

Some businesses opt for a hybrid approach, using monthly payroll for salaried employees and weekly payroll for hourly or part-time staff.

Monthly payroll use cases

Salaried workers: Monthly payroll is normally used by businesses with predominantly salaried workers who have fixed monthly incomes. These employees expect a consistent pay schedule.

Regular working hours: If you're in an industry with fairly standard working hours and limited overtime, you'll likely find monthly payroll simpler to manage, as there are fewer variations in your pay calculations.

Weekly payroll use cases

Variable hours and overtime: If your industry tends to see employees working varying hours or having frequent overtime (retail, hospitality, manufacturing etc), chances are, you'd benefit from weekly payroll. You'll be able to calculate variable pay and overtime more easily.

Part-time and temporary workers: If your workforce includes a substantial number of part-time or temporary workers with irregular schedules, weekly payroll will align better with their payment needs.

🔎 Monthly payroll use cases 🔎 Weekly payroll use cases
Salaried employees:businesses with predominantly salaried workers who have fixed monthly incomes Variable hours and overtime: industries that see lots of employees working varying hours or having frequent overtime
Regular working hours: industries with standard working hours and limited overtime Part-time and temporary employees: businesses with a substantial number of part-time or temporary employees with irregular schedule

Pento - a modern payroll solution that supports all industries and working patterns 🚀

At Pento, we're shaping the future of payroll management.

We set out to build a payroll solution that helps People, Finance, and Payroll teams across the UK work more efficiently and take the stress out of payday.

Pento is the only modern payroll solution in the UK that supports any pay schedule and any work pattern or type of worker - no matter whether or not 9-5 is the norm.

Running payroll in Pento

What separates Pento from other payroll providers?

Easy to use software

Pento automates the manual work around calculations, reduces human errors, and cuts time spent on payroll by around 80% on average.

Support from payroll experts

Get support from CIPP accredited payroll specialists whenever you need it - whether it's a quick question or complex payroll issue.

Ultimate visibility, flexibility and control

Pento works in real-time - so you can access information at any time. You control your payroll process and work to your own deadlines.

Direct integrations with your current systems

Whether it's an HRIS, accounting software or pension provider - Pento seamlessly integrates with all the tools in your stack.

Weekly payroll FAQ

How does weekly payroll differ from other pay frequencies?

Weekly payroll is more frequent than other pay frequencies such as bi-weekly or monthly pay schedules.

This means that your employees receive their pay every week, resulting in more frequent but smaller payslips.

How do I handle holiday pay and other statutory payments?

Your employees are entitled to holiday pay and other statutory payments like sick pay and maternity pay.

These payments are usually calculated based on the average weekly earnings over a specific period. You can find out more via HMRC's website.

you can look at an employee's pay over the last 52 reference weeks they've worked, counting back up to 104 weeks to get to 52 weeks total. If they didn't work at all, or had statutory payments in one of the potential reference weeks, you'd simply exclude this week in your calculations.

Need help working this out? Pento can help you with your variable holiday pay calculations.

Note: If an employee hasn't worked with you long enough to get to  52 reference weeks yet, you can still use the 52-week method. Just use the actual number of reference weeks they’ve worked so far to calculate your average.

Is there a week 53 in 2023 payroll?

For the year 2023, there are 53 weeks, depending on when you pay your employees.

So while there is only 52 weeks for some, for others there may be 53. 

What are the challenges of using a weekly payroll system? Are there any drawbacks?

  • More work for business owners: Increased admin work due to more frequent calculations and payments.
  • Extra cost: Potentially higher processing costs compared to less frequent pay schedules.
  • Higher risk of errors: With an increased frequency of calculations comes an increased risk of human error (which is why we'd recommend using an automated solution like Pento).

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