You might have heard some recent buzz about employee pay stubs not being compliant – some of the buzz is true, because not all payroll companies are compliant yet, leaving you vulnerable to wage and hour legal actions. There are a few pending already.
As a thought-leader and expert in the industry, we have a unique understanding of the rules and regulations within the hospitality space. We make all adjustments immediately, ensuring our clients are always protected. In addition, we go a step beyond state required pay stub compliance by displaying the credit for the employee and uncollected employee tax amounts.
Clients like Tao, Bobby Flay’s and Carmines have peace of mind that they are protected by Valiant Solutions, in addition to having significant positive impacts to their bottom line through meal credits, FICA tip tax credit, credit card fees and tip credits.
These are just a few examples of the expertise we bring to the restaurant vertical, and some of the reasons why these prestigious brands have partnered with us.
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In the meantime, please find additional information on pay stub compliance below.
Pay Stub Compliance: Defined
We find that New York State often has a set of complicated rules and regulations for the hospitality industry that other states don’t. Pay stub compliance can be a tricky thing. Tip credits, meal credits, tip reporting; it’s a lot to digest (no pun intended), leaving owners and operators scratching their heads more often than not, about what it all means and how it impacts them.
What Does It All Mean? What’s Required?
In short, it now requires employers to specifically break down every payment of wages that makes up their check in a different way. The hospitality wage order states the following requirements:
146-2.3. Statement to Employee
Every employer shall provide to each employee a statement, commonly referred to as a pay stub, with every payment of wages. The pay stub must list hours worked, rates paid, gross wages, credits claimed (for tips, meals and lodging) if any, deductions and net wages.
In addition, the New York State Department of Labor’s Senior Labor Standards Investigator confirmed Valiant’s pay stub is compliant and shared:
“The Hospitality wage order requires that the amount of tips earned must be shown. Therefore, the pay stub should show the hourly rate as $7.50 and the total amount of tips earned. It is not necessary to show the tip credit of $3.50 on the pay stub.”
Unfortunately, rumors relating to rules and regulations are often taken as fact. Many operators carry the false belief that the Federal Government enforces generalized pay stub compliance across all states and territories, allowing each jurisdiction to stack their individual requirements on top of those regulations. However, pay stub compliance has never been enacted on the federal level.
The only states that currently have virtually no pay stub requirements for compliance are Alabama, Arkansas, Mississippi, South Dakota, Tennessee, Louisiana, Florida and Georgia. The remaining 42 states have varying degrees of requirements.
For further information on pay stub compliance requirements across the nation, check out our definitive guide here.