Automated payroll systems generally are accurate and the most efficient way to process payroll, especially for an organization with a large workforce. Small companies that hire payroll clerks usually look for those whose performance records indicate attention to detail, accuracy and knowledge of payroll and tax regulations. But, if your employer continually makes mistakes on your earnings, tax withholding and deductions, alert your human resources department or payroll clerk as soon as possible.
If you're a new employee who started during the middle of a pay period, double-check your job offer to verify your salary or hourly rate and your payroll and deduction forms before you complain to HR. When you start a new job, make copies of the forms you complete for withholding federal, state and local taxes, as well as documentation related to contributions for health coverage, vision and dental care, long-term disability and any other deductions, such as amounts for retirement savings and money deposited to another bank account for regular savings.
Check Your Finances
If you're not a new employee and your paychecks seem to always be less than what you should receive, check your bank account for any automatic withdrawals scheduled to come out of your account. For instance, if your weekly paycheck is $1,000 and your account balance indicates you have $970 on the same date you get paid, ensure that you didn't have a debit from your account or a charge that you weren't aware of that may have been deducted on the same date you get paid.
Even if you have direct deposit, you should have access to your pay stubs, either by hard copy or electronic means, via your employer's intranet. To streamline the process, review your pay stubs before you contact your payroll staff. Highlight any inaccuracies, such as additional or fewer deductions than normal, variations in tax withholding or changes to your hourly rate or salary. If you notice a pattern, such as a lesser amount on the second paycheck of the month, highlight that and bring it up when you review your pay records with the payroll staff.
Review your tax withholding forms with the payroll staff. Go over your W-4s and state and local withholding forms to ensure you're claiming the proper number of exemptions. If you intended to claim your spouse or another dependent on your taxes, but your employer's tax records show that you listed only one exemption, your take-home pay is probably lower than what you might have expected. Likewise, if you claim only yourself, but there was an error on your withholding form that shows more than one exemption, you're probably getting more in each paycheck. Either incorrect scenario will affect your liability come tax time. Protect yourself by contacting the IRS to discuss your circumstances if your tax liability is affected by your employer's errors, and ask your employer to give you proof that they made the corrections.
Deductions and Additions
Check for charitable contributions via payroll deductions, a supplementary insurance option you didn't realize you selected or a salary increase that wasn't properly calculated. If you were told you get free parking and it's deducted from your paycheck, remind the payroll administrator of the terms of your employment, as well as benefits and perks you receive. Show proof of a salary raise or wage increase and ask for the amount to corrected retroactively.
When you've done everything possible to get your paycheck corrected and you think your employer's errors are intentional, contact the U.S. Department of Labor for assistance. Don't worry -- you can't be fired for filing a legitimate complaint. Employers must follow strict record keeping rules set out in the Fair Labor Standards Act and when workers report pay errors, nonreceipt of overtime pay, pay that falls below the federally mandated minimum wage or any other discrepancies, the Labor Department Wage and Hour Division investigates and resolves matters on behalf of shortchanged employees. In addition, the Labor Department's enforcement authority permits the agency to pursue legal action against employers who violate pay regulations. You could receive back pay plus additional money for damages that you incurred.
- U.S. Internal Revenue Service: Tax Withholding
- U.S. Department of Labor: Fact Sheet No. 44: Visits to Employers
- U.S. Department of Labor: WHD Local Offices
- TLNT The Business of HR: Wrong Response to a Pay Complaint Can Pose Big Employer Risks
- West Sound Workforce: When Can You Withhold Money from an Employee's Check?
Ruth Mayhew has been writing since the mid-1980s, and she has been an HR subject matter expert since 1995. Her work appears in "The Multi-Generational Workforce in the Health Care Industry," and she has been cited in numerous publications, including journals and textbooks that focus on human resources management practices. She holds a Master of Arts in sociology from the University of Missouri-Kansas City. Ruth resides in the nation's capital, Washington, D.C.