A pay stub, also known as a “payslip” or “pay statement,” is a document given to an employee when their salary is paid. It outlines the gross income, applicable deductions (taxes, contributions, insurance), and the net amount paid. This document is essential for ensuring transparency between employer and employee regarding compensation terms. Generally, the pay stub includes:
The pay stub may be provided in paper or digital format. It plays an important role in verifying social benefits, filing income tax returns, or disputing payroll-related errors.
The pay stub allows the employee to understand how their salary is calculated, especially the difference between gross pay and net pay. It also helps verify that the employer is meeting their obligations, such as overtime, paid leave, or legal deductions. In case of a dispute, it serves as valuable proof. Additionally, it can be used to:
A timesheet is used to record the hours worked by an employee, while the pay stub summarizes the financial outcome of those hours worked, including gross pay, deductions, and net pay.
It is the final amount received by the employee after all deductions have been applied. This amount differs from the gross pay, which is the total before deductions.
Yes, in most jurisdictions, employers are required to provide a pay stub to employees for each pay period, whether in paper or electronic format.
The employee should compare the hours recorded in their time tracking tool with those listed on the pay stub. They should also ensure that the deducted amounts match their contractual agreements and applicable tax regulations.
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