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Why Employees Need to Read Their Pay Stubs
No CommentsAfter the first couple of exciting weeks on a new job, getting a paycheck or a pay stub can turn into a routine event that employees start to ignore. If payroll is done through direct deposit, some employees may not even open the envelopes their stubs are sent in or bother to get online and check digital pay stubs. But this is a mistake.
Employees need to read their pay stubs every time they get paid. Here’s why.
Taxes and Withholding
Ensuring all the information on each pay stub is accurate is one of the most important reasons employees should check. Making sure their name, Social Security number, pay rates, paid time off balance and other information is all correct will save headaches later.
If your Social Security number is incorrect, the taxes your employer filed with the federal and state governments will also be wrong. It’s even possible that your withholdings could be applied to someone else’s account.
Do the math to make sure too much or too little isn’t withheld. If the number is incorrect, you could get an unpleasant surprise at tax time. The issue with tax errors is that while the withheld amount can be corrected if there’s an error, you can’t ask for taxes back once they’ve been withheld. You have to wait until tax time and file for a refund.
Hours Worked
Even if employees are salaried, it’s still important for them to look at the hours and make sure they’re correct. Hourly employees should track their hours and compare their records with the information on their pay stubs every pay period.
Paid Time Off
Employees should keep track of the time they take off throughout the year and check to ensure it matches up with what’s on the pay stub. When paychecks come a two-week cycle after time has been taken off, it can be easy for employees to lose track of their paid time off and think they have more left than they actually do.
Benefits Deductions
Employees should check to see if their benefits deductions — including health, dental, 401(k) and others — have been calculated correctly. If they aren’t on the paystub, employees may not be properly enrolled in their benefits plan — and may not find out until they go to the doctor and get a bill. Employees should ensure that coverage for spouses and children has been properly notated as well.
Check or Stub?
Whether employees have direct deposit or not, they should ensure that the stub they receive isn’t an actual paycheck. It may take a pay cycle or two to activate the direct deposit process, and it’s a common mistake for employees to throw away a live check, thinking that the deposit has already been made.
If anything is incorrect with an employee’s pay stub, it’s going to take time and effort to correct it. Employees may have to deal with delays in getting their money and the hassle of ensuring things have been taking care of. They do their jobs every day and want to be compensated for their work — getting their paychecks right shows that your company is on top of things and willing to ensure accuracy.
Outsourcing your company’s payroll processing can help ensure you get all the details correct. Contact us to learn how easy and affordable it can be.
HR Solutions is a human resources outsourcing firm based in Baton Rouge, Louisiana. We eliminate human resources headaches for businesses with 10 to 1,000 employees by handling their payroll, employee benefits, regulatory compliance and other staffing needs. Contact us to learn how we can streamline your company’s human resources function to save money and reduce risk.
