California Itemized Wage Statement Ultimately: CA Labor Code Requirements For Employers in Sacramento, CA
California Itemized Wage Statement Ultimately, an employer is liable for compliance with California Labor Code 226 which in part identifies what an itemized wage statement must include. Many employers rely upon their payroll service to ensure compliance, but the liability is with the employer and penalties are daunting.
For example, Amazon just entered into a $600,000 settlement for failure to provide accurate itemized wage statements. What is an Itemized Wage Statement? Labor Code Section 226 defines it as “detachable part of the check, draft or voucher paying the employee’s wages” or separate writing if the wages are paid by personal check or cash.
What must be on an Itemized Wage Statement?
- Gross wages earned;
- Total hours worked by the employee, except for any employee whose compensation is solely based on a salary and who is exempt from payment of overtime;
- The number of piece-rate units earned and any applicable piece rate if the employee is paid on a piece-rate basis;
- Employees paid on piece rate must also have the below on itemized wage statements:
- Total hours of compensable rest and recovery periods, the rate of pay for those periods and the total gross wages;
- Total hours of compensable non-productive time, the rate of pay for that time and the total gross wages.
- Employees paid on piece rate must also have the below on itemized wage statements:
- All deductions;
- Net wages earned;
- The inclusive dates of the period for which the employee is paid;
- The name of the employee and only the last four digits of the employee’s social security number;
- The name and address of the legal entity that is the employer. If a farm labor contractor, the wages statement must include the name and address of the legal entity that secured the services of the employer;
- All applicable hourly rates in effect during the pay period and the corresponding number of hours worked at each hourly rate. If a temporary service employer, the rate of pay and total hours worked for each temporary assignment;
- All payroll records should be kept in ink and retained for at least three (3) years at the place of employment or a location in California; and
- The amount of an employee’s paid sick leave which is available for use, unless otherwise provided in writing each pay period to each employee.
Both the updated Federal Minimum Wage and Polygraph posters were to be posted by 8/1/16. The compliance date of December 1, 2016, is rapidly approaching for the new Federal Overtime Regulations mandating an annual wage of $47,474. If you have a 401k plan, be sure to distribute the Summary Annual report no later than September 30.
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