Payday is the day that everyone looks forward to. The day that your hard work is rewarded and recognized with a paycheck. However, as exciting as payday may be, understanding a paycheck can be confusing, and if the number on the pay stub is different than what an employee expected, it can quickly become a frustrating experience.
Misunderstandings like this don’t just ruin the fun of payday but can also create tension between employee and employer, eroding trust and potentially harming employee retention. The good news is this is all within your control. If the paycheck itself is a source of frustration, all you need is a little pay transparency magic!
We all know that trust is key when it comes to building a happy and productive team. On payday, the best way to build trust is through pay transparency. While understanding hourly rates may appear simple, once all factors are considered (overtime, pay differentials, deductions, etc.), it becomes increasingly important to give employees a peek behind the curtain and show them how what may appear like magic is not actually as confusing as it may seem.
When employees can clearly see how their take-home pay was calculated, they’re more likely to feel more confident that they’ve been paid fairly and accurately. Each company will need to provide different information on their pay stub since not all businesses compensate their employees in the same way. In addition, your location can have an impact as well, with some states or localities having different tax withholdings like SUI, SDI, etc. While Geo Tax provides clarity on the admin side, employees need the process explained on the pay stub side of things.
Custom, detailed pay stubs are the best way to foster an environment in which employees can fully understand how their pay is calculated. While a traditional pay stub may follow the payroll accounting equation of gross – taxes – deductions = net pay, a more detailed breakdown of how net pay was calculated can provide increased pay transparency for employees.
What’s included in that detailed breakdown is going to change depending on how your organization pays its staff. Some examples of this may include individual shifts that are paid at different rates, overtime premiums, or simply listing how much PTO or sick time they have accumulated.
The final trick for reducing payday misunderstandings is distributing those custom pay stubs you just built in an easily accessible way. After all, it won’t be much use for your staff if they don’t know how to easily find them! This is best done with an Employee Self Service portal that can be accessed via the web or mobile app. That way, no matter where they are, they can easily reference their pay stub to answer any questions they may have regarding their take-home pay.
While custom pay stubs may pull the curtain back on the magic of calculating take-home pay, it lends itself to a much more fun trick instead. Right before your eyes, payday misunderstandings and frustration disappear! Rather than having to ask a payroll admin or manager for any questions they may have, employees will be empowered to read through and understand their own pay stub. This not only saves time for your admins by reducing the number of questions they need to answer each day but also increases employee satisfaction (and therefore employee retention) within your company.
As usual, things are easier said than done. Knowing that you should be doing something is different than having the tools to get it done properly. That’s where we come in. Viventium offers admins the ability to customize pay stubs however they want. Simply choose what information you want on the pay stub and where you want it to show up, save it, and from then on, employee pay stubs will automatically display all the information they need, every time payroll is run.
Providing custom, transparent pay stubs is just one part of an effective HR strategy when trying to build a positive work environment. Be sure to check out some of our other blogs to see what features included within Viventium can help streamline workflows for admins and give employees the best experience possible while working at your company.
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