Payroll Services

Biweekly Deductions Holiday

Two types of deductions are taken from paychecks:

  • Flat dollar amount deductions are set dollar amounts that do not vary from paycheck to paycheck (e.g. $25). Examples include: health and welfare benefits, transit and parking deductions, credit union deductions, loan payments, etc.
  • Percent deductions are proportionate to your earnings (e.g. 2% of your gross pay. Gross pay may vary if you work overtime or work a variable schedule.) Examples include: state and federal taxes, UC Retirement Plan, Medicare, OASDI, etc.

For biweekly paid employees, payroll deductions are split across the biweekly paychecks.

  • Flat dollar amount deductions are divided and deducted twice each month.
  • Percentage based deductions are deducted from every check.

Payroll deductions are taken in this way to provide biweekly paid employees with a more predictable "take home" or "net" pay.

Benefits "Holidays"

When there are three biweekly pay periods in a month, the flat dollar amount deductions are not taken from the paycheck that represents the third pay period. The paydays when flat dollar amount benefits are not deducted are referred to as benefits "holidays." This typically occurs twice each year.

It may be helpful to take a look at the payroll calendar. Note that two months have three pay period end dates. The time worked during the third pay period of the preceding month have benefit holidays with deductions for percentage based deductions.

An Exception for Garnishments

All garnishments, whether flat dollar amounts or percentages, are deducted from every paycheck. This is the only exception to the way that flat dollar and percentage deductions are made. Flat dollar garnishments are calculated as follows: Monthly amount times 12 divided by 26. Example: $500.00 per month equals $6,000.00 per year, divided by 26 equals $230.77 biweekly deductions.

Type of Deduction
Percentage Based Deductions

Withheld from every paycheck (26 times per year)

Flat Dollar Amount Deductions

Withheld from first two biweekly paychecks of the month (24 times per year) -- except garnishments

Insurance

Health Insurance
Life and Dependent Life
Accidental Death and Dismemberment
Health Care/Dependent Care

Retirement

403B or 457B, if employee has elected flat dollar amount deduction (such as $100 per month)

Other

Flex Spending
Legal Insurance
California Casualty
Scholarshare
Loans, Credit Union and 43B loans
Parking and Transit, etc.

Taxes

Federal
State
OASDI
Medicare

Retirement

UC Retirement Plan (UCRP)
403B or 457B, if employee has elected a percentage deduction (such as 3% of every check)

Other

Union Dues/Fair Share
Garnishments (both percentage and fixed dollar amounts. See above.)

Key Points
  • Flat dollar amount deductions are split evenly between the two paychecks that represent the first and second biweekly pay periods of that month.
  • When there are three biweekly pay period end dates in a calendar month (which typically occurs twice each year), no flat dollar amount deductions will be taken from the pay check for the third biweekly pay period. This is called a "benefits holiday."
  • Percentage-based deductions are always taken from every check.
  • Flat dollar amount garnishments are always taken from every check.

Supplemental content

Payroll Services Menu