Overlooked Pay Stub Requirements Can Lead to Trouble

California law requires employers to provide written itemized wage statements containing precise, detailed pay-related information every pay period.

Penalties for failure to comply with these pay stub requirements entitles each worker to recover at least $50 for the first violation and a minimum $100 for each subsequent occurrence up to a maximum of $4000. Multiply those potential liabilities by the number of employees and the frequency of pay periods over a year’s time and a company may be in serious jeopardy for even one seemingly innocuous omission.

Therefore, it’s important to avoid potentially costly errors including but not limited to:

• Leaving off a line item for premium payments for missed meal or rest breaks. According to California law, an employee must be paid one additional hour of pay for each work day that the meal, rest or recovery period is not provided. Two hours of premium pay is the maximum amount that can be owed because there is one violation each for missed meal breaks and missed rest breaks per day, rather than for each occurrence. See, Employee Meal Periods and Rest Breaks (September, 2016).
• Forgetting to add accrued, unused paid sick leave hours as required by applicable state-wide paid sick leave law.
• Omitting the last four digits of the employee’s social security number or the employee’s identification number.
• Not listing the full name and current address of the legal employing entity. The employer’s name is usually listed but sometimes the address is omitted. The law requires both.
• Neglecting to include both the start and end date of the pay period. This is in addition to the check date.
• Failing to include all of the many disclosure requirements concerning piece work. See, California Piece Rate Law: No Time To Relax on Rest-Recovery Premium Pay (September, 2016).
• Incorrectly assuming that your payroll company knows how to comply with California law or that your service will be ultimately responsible for liability stemming from any errors. Many payroll services seek to absolve themselves of such exposure by the fine print in their vendor contracts.

California Employers Beware: At present, the Labor Commissioner office’s online sample check stub format does not fully comply with all itemized wage statement requirements. For additional guidance, please see: California’s Itemized Pay Stub Requirements (March, 2016).

For further information, please contact Tim Bowles, Cindy Bamforth or Helena Kobrin.

Cindy Bamforth

February 23, 2018