What information is included in a pay stub?

A pay stub, also known as a pay slip or paycheck stub, serves as a comprehensive document detailing an employee's payment particulars for a specific pay period. It comes in various forms depending on the payment method, either attached to physical paychecks or accessible digitally through online payroll services.

Contents of a Pay Stub

In the United States, pay stubs typically include the following information:

Employer Information: Company name, address, contact details, and Employer Identification Number (EIN).
Employee Information: Full name, address, and tax identification details such as Social Security Number (SSN), Taxpayer Identification Number (TIN), or Individual Taxpayer Identification Number (ITIN).
Hourly Rate and Hours Worked: Details of the hourly wage and the total hours worked during the pay period, including any overtime hours and corresponding pay.
Bonuses, Rewards, and Paid Time Off: Additional income sources such as bonuses, as well as the utilization of paid time off.
Gross Wages and Deductions: Total pre-tax earnings and deductions, including payroll taxes (federal, state, and local), benefits contributions, retirement plans, and wage garnishments.
Back Pay/Back Wages: Compensation for previously unpaid wages.
Net Pay: The final amount disbursed to the employee after deducting taxes and other withholdings from gross wages.

Distinction Between Pay Stub and Paycheck

While often used interchangeably, a pay stub is a component of a paycheck that provides detailed payment information, whereas a paycheck solely represents the actual payment issued to the employee.

Importance of Pay Stubs

For employers, maintaining pay stub records is vital for tax compliance and resolving any payment-related disputes with employees. Employees, on the other hand, should review pay stubs to understand their compensation structure, tax obligations, and ensure accurate payment for their work.

Uses of Pay Stubs

Financial Transactions: Pay stubs serve as proof of income for various financial transactions, such as renting or buying a home, and obtaining loans.
Employment Verification: Some employers may request pay stubs during the hiring process, although this practice is restricted in certain states.

Legal Requirements and Access

Employers' obligations regarding pay stub provision vary by jurisdiction. While some states mandate the issuance of pay stubs, others do not. However, under the Fair Labor Standards Act (FLSA), employers must maintain payroll records for a specified period.

Accessing Pay Stubs

Employers must provide employees with access to their pay stubs/payroll details, either in physical or electronic form, depending on the state's regulations. In summary, pay stubs play a crucial role in ensuring transparency and accountability in payroll processes, benefiting both employers and employees in managing financial matters effectively.