What Is a Pay Stub? Am I Required to Provide Pay Stubs for My Employees?
There are things you want to do, and then there are things you have to do. When it comes to providing pay stubs for employees, it’s easy to see it more as the second, almost like getting a child to eat a plate of brussels sprouts. They might ask: How many do I have to eat before I get dessert? And you might ask: What more will it take to get these pay stubs out the door and move on to more important things?
But just because something is healthy doesn’t mean it has to be unpleasant—adding crispy bacon and a balsamic glaze can transform brussels sprouts from childhood nightmare to fine dining. Likewise, understanding the figures that go into a pay stub, the software that tracks this data, and the requirements for delivering pay stubs can help make payroll processing—pay stubs included—a smooth, secure process for everyone involved. And as for more important things? Well, pay stubs may not be as glamorous as rewards and recognition efforts, but just like eating your brussels sprouts, they’re essential.
What Is a Pay Stub?
A pay stub is a financial record employees receive with each paycheck. Before digital banking, employees would cash a paper paycheck, which was attached to a paper “stub” listing the breakdown of hours worked, earnings, deductions, and taxes. Paper pay stubs are far from extinct; many companies still use paper checks, and even with direct deposit, many employees will get their first paycheck at a new job on paper, complete with a real, old-fashioned paper pay stub.
Whether on paper or in a PDF, the principle behind pay stubs remains even though the medium has changed—employers must deliver pay stub information so employees can see the breakdown of each paycheck.
What Information Goes on a Pay Stub?
Pay stubs should include the following demographic and financial information:
- Employee information, including name, social security number, and address
- Employer information, including name and address
- The dates of the pay period
- Employee pay rate
- Gross earnings
- Taxes withheld
- Employee contributions to retirement plans, pensions, or other funds
- Net pay
The pay stub should also include the factors that determined the employee’s gross pay, including:
- The hourly rate
- The number of hours worked
- Any overtime hours
- Any bonuses
Salaried workers often have their pay represented through 40 hours each week at a rate that adds up to their annual salary. Some states also require sick leave accrual to be listed on the pay stub.
Am I Required to Provide a Pay Stub to My Employees?
Most states have laws requiring employers to provide employees with regular pay stubs, so the most likely answer is yes, your organization has a requirement to provide pay stubs.
Pull quote: Pay stub access can be so much more than a notification.
What Requirements Does My State Have About Providing Pay Stubs?
Because there is no standard federal law for providing access to pay stub information, you’ll need to find the details for your specific state. These state laws begin with whether employers are required to provide employee access to the information included in pay stubs. Some states then specify whether employers must include print access to pay stubs and whether employees or employers must consent to certain methods of pay stub delivery.
In these states, employers aren’t required to provide access to pay stub information.
- South Dakota
In these states, employers must provide access to pay stub information. There are no constraints on the method of access.
- New Hampshire
- New Jersey
- New York
- North Dakota
- Rhode Island
- South Carolina
- West Virginia
In these states, if employers provide pay stub information electronically, then they also need to ensure employees have the means to print off physical copies.
- New Mexico
- North Carolina
In Delaware, Minnesota, and Oregon, if an employer shifts to electronic-only pay stubs, they must give employees the option to opt out of electronic delivery and return to paper pay stubs.
In Hawaii, employers must have employees’ consent to receive electronic pay statements or continue providing physical pay stubs.
It’s important to understand these pay stub access requirements so your organization can comply with them. But instead of stopping there, think about the benefits; just like eating your veggies is beneficial to your health, streamlining access to pay stubs shows your organization’s health and competence.
How Can I Improve the Pay Stub Experience for My Employees?
Providing your employees with pay stub access is the first step toward meeting their most basic payroll expectations. But access can be so much more than a notification, and connecting employees with current data makes it easier for employees to use their pay information.
For example, the Pay Info tab in BambooHR® gives employees a snapshot of their most recent pay stub. But it also goes further, providing quick access to historical information that makes calculations faster—for example, if a lender is asking an employee to disclose their earnings from the past two months, finding this info in BambooHR is much faster than searching through an inbox and re-downloading PDF pay stubs.
When you go beyond pay stub basics and make pay information clear, connected, and accessible, employees can get what they need to take care of their personal finances without coming to administrators with repeated requests. All in all, it’s a much more delicious experience for everyone.