The employee holdback for biweekly payrolls is designed to help employees manage the cash flow from their paychecks by equalizing the net pay between the first and second paychecks of the month. Medical insurance deductions are taken out of the check for the first biweekly period ending in the month and most other deductions are taken out of the check for the second biweekly period ending in the month. Since medical insurance premiums are typically larger than other deductions, the first paycheck’s net amount is usually less than the second paycheck. To make the net pay on both checks more equal, the employee may now choose to have dollars withheld from the check for the second biweekly in a month and added back to the check for the first biweekly pay period in the next month. This can help offset the larger medical deduction.
The form to enroll or cancel the employee holdback should be sent to the UT System Payroll office by the 15th of the month to be effective for that month.