Employee Pay Policy



Having an Employee Pay Policy will eliminate many questions that arise especially for newer staff members.

As you sift through all the policies presented within the Employee Handbook Templates website I hope you are realizing that having a complete employee handbook will save you a tremendous amount of headaches.















In the area of an employee pay policy there are a few things for sure you will want to make very clear.

As an example, how do you want to handle your pay period and when and how will checks be issued? Perhaps you will not issue checks at all, but instead make it mandatory as a condition of employment to receive the pay check through direct deposit. This method can save your business money if you look into how it operates.


California has some pretty stringent requirements on this…


As it relates to when your pay period ends and how long after that you issue either a check or direct deposit you will want to make sure you do not violate your state law. I know for a fact that California has some pretty stringent requirements on this. Your employment handbook needs to at a minimum meet those requirements. The last thing you want is a policy that does not meet it. That will, without a doubt, equal large fines!

Additional topics that should be contained within your policy would be who can 'approve overtime, and what would happen if over time is not approved.

This is a touchy subject and again I will caution you that you must follow the Fair Labor Standards Act when it comes to overtime; however, the overtime should be approved in advance. If it is not approved in advance the time worked could become questionable as to its validity. At a minimum the employee may be subject to progressive disciplinary action.

When an employee leaves and still has vacation or sick time on the books…


You will also want to include holiday and sick pay as part of your employee pay policy. When an employee leaves and still has vacation or sick time on the books, how will it be paid out? On the other hand your employee vacation and sick time policy should state how and when the employee has actually earned the time.

Think about how you will handle their final pay check if they do not turn in company owned property. Will you withhold any amount? Again, states like California have laws that dictate how much you can withhold from a pay check, whether it is their final one or not.

The timing from submitting something like a change in bank accounts…

I would also include a piece within your employee pay policy that talks about things like how benefits are deducted. Also how are your federal forms handled and what about the timing from submitting something like a change in bank accounts when you have direct deposit?

As you can see there is a lot more to consider than you thought. The Employee Handbook Templates website is hopefully able to assist you in figuring out what is important and what is not. Good luck on putting your employee handbook together.


Good Luck and May God Bless You!

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