What is a Pay Group?

A pay group is a set of employees grouped according to shared characteristics and paid on the same schedule. Grouping employees in this manner ensures easier processing of the payroll. A pay group enables a company to sort employees based on pay frequency.

An employee may only belong to one pay group, and each group is assigned a group code in an organization’s payroll system. Companies typically have multiple pay groups based on, for example, pay frequency, employee type, and shared location.