Paystub Transparency
Idea Category: Jobs and Entrepreneurship, Smart Government
Problem
Since 2008, wage theft has increased dramatically. Working families can barely survive on the low wages they receive, let alone when employers shirk responsibility of paying what is owed. States then lose out too, on taxes to be collected, and honest employers are put at a disadvantage. This problem is easy to mask because of minimal requirements for paystubs: many paystubs have only the name of the employee and the total amount paid - failing to indicate what hours and what rate of pay, or whether taxes were withheld. Many low-wage workers don't even know which contractor is paying them, so they don't know who to sue or complain to.
Solution
Setting a new standard to ensure necessary information is being provided to workers is imperative to reduce wage theft and economic inequality. No federal and minimal state requirements currently exist regarding required information on paystubs. To protect workers in a contract economy and to level the playing field for employers, we need to set regulations to require companies to provide standardized paystubs.
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