On payday, employees will check their bank account to see if the money is there. The average employee will then check the pay stub provided by the employer. Also referred to as the paycheck stub or the pay slip, the pay stub contains important information that every employee should know about.
Employees have right to know this information. As a fair labor practice, employers should provide their employees with a pay stub when the employees receive pay. If you are looking into starting business, you may be wondering what information should be on a pay stub; this paycheck stub generator will show you how to ensure your business is able to generate pay stubs for your employees.
Gross Pay
In this section of the pay stub, employees will find the total amount they have earned within the pay period, before deductions. This section will show the rate paid hourly or based on the salary. Year-to-date totals appear here as well.
Tax Deductions
The taxes taken out of the paycheck appear in the tax deductions section. Federal income tax (e.g., Medicare) and Social Security will be listed here. State and local taxes withheld, which may be taken out depending on the city and state where the employee resides, will be listed here as well. This, along with a wealth of free tax tools, is important as it helps employees prepare their tax returns.
Other Deductions
Besides the standard deductions that the majority of employees will see on their pay stub, many employees will have other deductions. Employee contributions to a retirement plan (e.g., 401K), pension plan, or health care plan will be listed here.
Net Pay
The net pay is amount of money that employees make after deductions. Sometimes referred to as ‘take-home pay,’ the net pay is essentially what employees see in their bank account on payday. Just like in the gross pay section, year-to-date totals appear here as well.
Wage Garnishments
Not all employees will have this section on their paystub. If an employee has this section on his or her paystub, it may mean that the employer is withholding a certain amount of wages from the paycheck. This is often the case if an employee has to pay child support payments or a tax bill.
Employee Information
Each paystub will also include the employee’s respective personal information. Information listed here can include the employee’s name, employee ID number (if given one), and address.
This Essential Information Comprises the Pay Stub
As a business, you want to be able to provide your employees with this information. This is information that they need to know about. The information provided in an employee’s paystub will help them understand how much they are being paid and where their hard-earned money is going. This will serve as guide to help you understand how to generate a paystub for employees. This will benefit your business and your employees.
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