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50 Payroll Terms Every Small Business Owner Should Know

payroll acronyms

Non-taxable wages are specific types of compensation exempt from income taxes. Understanding which wages are non-taxable allows small business owners to provide added benefits to their employees efficiently. Disposable income refers to the leftover wages after all taxes and deductions have been taken from an employee’s paycheck.

Generate Pay Stubs

There are several different taxes typically displayed and taken out of your pay stubs. Some company usually imposes its own set of pay stub abbreviations to make it easier for employees to understand. These real pay stubs provide information that can be verified by potential creditors, making the process of buying a home, car, or normal balance applying for a loan quick and simple.

How does workers’ compensation relate to payroll?

The employer assigns/allocates an additional amount in tips on the W-2 of employees whose reported tips are less than 8% of the total gross sales. A state-administered program that provides partial wage replacement to employees who are unable to work because of an illness or injury. Depending on the state, SDI coverage may be funded by the employee, the employer, or both. Payment made to an employee to cover time away from work due to falling ill. The Social Security and Medicare taxes a self-employed person is legally required to pay. Additional wages paid to employees for working undesirable hours, such as weekends, nights, or holidays.

Refers to when an employer pays its employees once every two weeks, such as every other Friday. A government-run program that gives short-term disability benefits to employees. The total what are provisions in accounting value of non-cash compensation given to employees by an employer. A labor metric representing the total hours of all part-time staff in relation to a full-time employee’s hours.

Employee onboarding is how you introduce your new employees to your business and their roles. It also includes collecting necessary tax forms, setting up payment details, and benefits enrollment. A smooth onboarding process ensures compliance and enhances the employee experience. A timekeeping system tracks the hours each employee works, which is crucial for accurately calculating paychecks.

General Pay Stub Abbreviations

Structured conversation with departing employees to gain feedback on their experience. Organized groups of employees with a common identity, interest, or background. A framework to enhance employee representation and support across a broad spectrum of how to find dropshipping suppliers and wholesalers demographics.

  1. Once you familiarize yourself with these key payroll phrases, you will feel like an expert next time you run your payroll.
  2. An HR metric used to assess employee growth and movement within an organization.
  3. Base pay is the initial rate of compensation an employee receives before any extras, like bonuses or overtime.
  4. Note that some states require higher overtime rates and require overtime for daily hours worked over eight, so make sure you’re following your local regulations.
  5. Child support is a garnishment that is often placed when couples divorce and one does not pay as agreed in a divorce decree.

A ranking system representing how likely an employer is to generate insurance claims. A measurement of employee satisfaction based on their likelihood to recommend their employer. An employee’s entire time spent within an organization from initial hiring to final exit.

payroll acronyms

Portions of an employee’s income that aren’t taxable for a variety of reasons. A provision in the ACA requiring large employers to provide a minimum level of affordable health coverage. The concept that income is taxable, even if the taxpayer hasn’t yet physically received it. A term used in the Affordable Care Act for employers with 50+ full-time or full-time equivalent employees. A grid-based framework used to compare employees’ work performance and potential.

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