27 Pay Periods in 2026: What Employers Need to Know Now
If you run payroll on a bi weekly schedule, you likely expect 26 pay periods each year. In most years, that assumption holds.
In 2026, however, some employers will have 27 pay periods instead of 26, depending on when their payroll cycle began. If this is not planned for in advance, the extra pay period can create budget overruns and wage and hour compliance issues.
This is already coming up in client conversations and was recently highlighted in a Fisher Phillips article on payroll compliance. Here is what employers should know and why it matters.
Why there are 27 pay periods in 2026
Bi weekly payroll operates on a 14 day cycle rather than a calendar year. Because of leap years and how days fall, an extra pay period appears roughly every decade.
Employers who issued their first paycheck on Friday January 2 2026 will likely issue their final paycheck on Thursday December 31 2026 (since Friday, January 1, 2027 is a holiday), resulting in 27 total paychecks for the year.
Why the extra pay period matters for payroll and compliance
The biggest risk employers face in a 27 pay period year is unintentionally overpaying salaried exempt employees.
For example, an employee earning 130,000 annually typically receives 26 paychecks of 5,000. If payroll runs 27 times without adjustment, that employee will receive 135,000 in total compensation. That is a 3.85 percent increase in salary, before factoring in additional payroll taxes and benefit contributions.
When this happens, employers often ask whether they can reduce or skip a paycheck later in the year. For exempt employees, this can create serious compliance risk.
Salary basis rules employers need to remember
Most exempt employees under the Fair Labor Standards Act must be paid on a salary basis, meet minimum salary thresholds, and satisfy duties tests.
Being paid on a salary basis means receiving a predetermined amount each pay period. In most cases, employers cannot reduce that amount due to payroll timing issues without risking exempt classification. Remember that in most cases, exempt employees must earn a minimum of $684 a week under federal law to maintain exempt status, in addition to meeting certain duties tests.
It is also important to remember that many states impose higher salary thresholds or additional requirements, so compliance must be evaluated under both federal and state law.
Common payroll mistakes in a 27 pay period year
Employers often run into trouble when they divide salaries by 26 without reviewing the payroll calendar, reduce pay without considering minimum salary requirements, overlook benefit and retirement contribution limits, fail to provide required notice before pay changes, or underestimate the budget impact of an extra payroll run.
These issues are common and preventable with early planning.
What employers should do now
If you have not already reviewed your 2026 payroll calendar, start there. Confirm whether your organization will have 27 bi weekly pay periods.
From there, determine how you will handle the extra pay period in a compliant way, communicate clearly with employees about any changes, review benefit deductions and annual limits, and revisit your 2026 payroll budget to account for the additional costs.
Final thoughts
A 27 pay period year does not have to create problems, but failing to plan for it often does.
If you are unsure how this applies to your organization or want support navigating payroll compliance in 2026, this is an area where proactive guidance can make a meaningful difference.
Source and further reading
This post is informed by the Fisher Phillips Insight titled Pay Attention to Payroll Compliance 5 Steps for Employers Facing 27 Pay Periods in 2026 published January 16 2026, along with practical payroll and compliance considerations I see regularly when working with employers.
