Close to 100 percent of workers are now receiving their pay by direct deposit, but paper checks are still used by several small businesses today.
The Fair Labor Standards Act (FLSA) does not require employers to provide pay stubs, but it does require them to keep accurate records of their employees' wages and hours worked. Thus, before you decide how to go about paying your staff, make sure you're following state compliance. To learn more, give this a click.
States with NO Pay Stub Requirements
At present, there are nine states that do not require employers to give out pay stubs to employees, but pay stubs may be provided electronically if elected by the employers. Such states are the following:
States that Require Pay Information ACCESS
On the other hand, there are states that do require employers to furnish statements that detail employees' pay information. But it is not necessary to provide the pay statement on paper. Here are those states:
A sensible interpretation of the law suggests that employers can meet these states' pay stub requirements through digital means. At any rate, the digital or electronic pay stubs must be readily accessible to employees.
Keep in mind though that even with most states adopting this interpretation, some state agencies may require more items - for example, the ability to print the electronic pay stubs.
States Requiring Pay Information ACCESS AND PRINT Capability
Certain states require written or printed pay statements to be provided by employers to workers. But these pay statements do not necessarily have to be delivered together with the check or in another format. Logical interpretation of this law says an employer can meet this pay stub requirement by providing workers with printable electronic pay stubs. It is the employers' lookout to guarantee that the electronic pay stubs are accessible to employees and can be printed anytime. This is where you'll want to get more info.
Yet again, there may be additional items required by some state agencies, like the worker's consent to receive electronic pay stubs. The above applies in the following states:
At present, Hawaii is the only state which requires worker consent before an electronic pay system can be implemented. Except when the employee consented to the paperless method, the employer is required to provide a written or printed pay stub that includes the worker's pay details.
If the state chooses a certain means of delivery, like on the pay envelope or pay check, the employee must agree to electronic delivery. Should employers in opt-out states - Minnesota, Oregon and Delaware - go for a paperless pay program, workers should have the option to go back to the traditional system that provides them paper pay stubs.