Payroll laws: what employers must do to stay compliant (by state)
If you’re searching for payroll laws, you’re likely trying to answer practical questions fast: How often do I have to pay employees? What must appear on a pay stub? Which deductions are allowed? What records do I need if the department of labour investigates? This SwiftSDS guide explains core payroll laws and regulations that apply to most U.S. employers, how state rules differ, and what to implement in your payroll process to reduce wage-and-hour risk.
For a state-by-state view, start with Payroll laws by state and then drill into the jurisdictions where you operate.
What “payroll laws” cover (and why they vary by state)
“Payroll laws” is an umbrella term for payroll regulations found in federal law and each state’s labor code (or equivalent wage-and-hour statutes). These rules typically govern:
- Pay frequency and paydays (weekly, biweekly, semimonthly, monthly)
- Final pay timing when an employee quits or is terminated
- Pay statement (pay stub) requirements (what details must be listed)
- Permissible deductions and deduction authorization rules
- Minimum wage and overtime (federal baseline + state/local higher standards)
- Timekeeping and payroll record retention
- Wage notice and poster/posting requirements (often enforced by an employment law state office or labor department)
At the federal level, the Fair Labor Standards Act (FLSA) is the backbone of department of labour legislation for wages and overtime. Many employers also must display the official FLSA poster, such as Employee Rights Under the Fair Labor Standards Act (and the Spanish version, Derechos de los Trabajadores Bajo la Ley de Normas Justas de Trabajo (FLSA)).
Core payroll rules employers should implement everywhere
Pay frequency: set a compliant payroll calendar
Most states require a regular payday schedule and may restrict how infrequently you can pay non-exempt employees. Action steps:
- Publish your pay schedule in writing (employee handbook and onboarding packet).
- Align payroll cutoff dates with time approval workflows to avoid late payments.
- Confirm whether your state requires specific paydays for certain industries.
If you operate in multiple states, compare requirements using Payroll laws by state to prevent a “one-size-fits-all” pay cycle from creating violations.
Final pay: treat terminations and resignations differently
Final paycheck rules are a common enforcement hotspot. Many states impose shorter deadlines when an employee is terminated versus when they resign with notice. Action steps:
- Create a termination checklist that triggers immediate wage calculations (regular hours, overtime, bonuses due, reimbursable expenses where required).
- Document your final pay method (in-person check, direct deposit, mail) and confirm it’s allowed in that state.
Pay stubs and wage statements: standardize what you show
Even when the amount paid is correct, missing wage statement details can lead to penalties. Action steps:
- Configure payroll software to display required items (employer legal name/address, pay period dates, hours worked for hourly staff, rate(s) of pay, gross wages, itemized deductions, net wages, sick leave balances where required, etc.).
- Keep wage statements accessible (paper or electronic) according to state rules.
Deductions: require written authorization and validate legality
States often limit deductions for shortages, tools/uniforms, or business losses—especially if they drop pay below minimum wage. Action steps:
- Use a written deduction authorization form (and keep it with payroll records).
- Validate any “non-standard” deduction with state wage-and-hour rules before implementing.
Recordkeeping: assume you’ll need proof later
Under the FLSA, employers must keep payroll records such as hours worked and wages paid for covered employees, and states may add requirements. Action steps:
- Maintain time records, wage statements, and deduction authorizations in a secure system.
- Apply a retention schedule that meets or exceeds both federal and state minimums.
Paycheck laws in California: high-risk compliance areas
California is a frequent reference point for paycheck laws in California because enforcement and penalties can be significant. California payroll compliance is primarily driven by the state’s wage statement rules, pay timing rules, and final pay requirements found in the California Labor Code and related wage orders.
For deeper context on the broader framework, see California employment laws and the California labour code overview.
Wage statements (pay stubs): detail matters
California requires specific information on itemized wage statements (often called “Labor Code 226” compliance). Employers should ensure payroll systems accurately reflect:
- Pay period dates
- Gross and net wages
- All deductions
- Hours worked (with some exceptions depending on pay type)
- Applicable rates and units
If you run worksites across California, also confirm you’re meeting required postings via California (CA) Posting Requirements. For Los Angeles-area employers, local requirements may apply—review Los Angeles County, CA Posting Requirements and Los Angeles, Los Angeles County, CA Posting Requirements.
Final pay timing and separation pay procedures
California’s final pay rules can require immediate action at termination and tight timelines when an employee quits. Practical controls:
- Train managers to notify HR/payroll before same-day terminations.
- Maintain a “final pay packet” workflow (final wages + required documentation).
- Audit direct deposit rules for final pay—California has constraints that can affect delivery method.
Minimum wage changes affect payroll calculations
Minimum wage isn’t static; it can change by state and locality, and pay rates must keep up. California has had many high-visibility wage discussions and proposals; for related minimum wage context, SwiftSDS tracks developments such as california 50 dollar minimum wage (for background and compliance awareness).
For wage-and-hour specifics beyond paychecks (overtime, meal/rest impacts, etc.), see California wage law.
Anti-discrimination overlap: consistent payroll practices reduce risk
Payroll processes can create discrimination exposure if wage practices are inconsistent across protected groups (e.g., pay differentials, inconsistent deductions, or unequal access to pay information). California employers should also align payroll administration with broader compliance under anti discrimination laws in california.
How to work with your employment law state office (and avoid enforcement surprises)
Most states enforce wage-and-hour rules through an employment law state office (labor department, workforce commission, or attorney general wage-and-hour division). To reduce audit and complaint risk:
- Document policies: paydays, timekeeping, overtime approval, deductions, and final pay.
- Use consistent time approval: late approvals often lead to late or inaccurate pay.
- Post required notices: federal and state posters are often mandatory and can be checked during investigations. For example, keep the federal FLSA poster accessible: Employee Rights Under the Fair Labor Standards Act.
- Run periodic payroll self-audits: sample pay periods, verify overtime calculations, check wage statement fields, and confirm deduction authorizations.
Multi-state payroll compliance: a simple operating model
If you employ people in more than one state, the safest approach is to build a baseline payroll process and then layer state rules:
- Create a state matrix: pay frequency, final pay deadlines, pay stub fields, deduction restrictions, record retention.
- Configure payroll by work location: not just company HQ—many rules apply where the employee works.
- Watch local overlays: large cities/counties may have posting or wage rules. (Example: California local posting pages like Los Angeles County, CA Posting Requirements.)
- Maintain compliance content by state: SwiftSDS maintains state pages like Florida payroll laws and topic-specific guides such as alabama minimum wage.
FAQ: payroll laws and regulations
What is the difference between payroll regulations and the labor code?
“Payroll regulations” usually refers to the rules you must follow (paydays, wage statements, deductions, records). The “labor code” is the set of statutes (state law) where many of those rules are written, often supported by regulations or agency guidance.
Are pay stubs required in every state?
Not always—but many states require wage statements with specific details, and even where not required, providing accurate pay stubs is a strong best practice. States like California are particularly detailed about wage statement content. If you operate there, review California employment laws and confirm postings under California (CA) Posting Requirements.
Which poster is required under U.S. Department of Labor legislation?
Many employers must display the FLSA minimum wage poster from the Wage and Hour Division. Keep Employee Rights Under the Fair Labor Standards Act (and the Spanish version Derechos de los Trabajadores Bajo la Ley de Normas Justas de Trabajo (FLSA)) available where employees can readily see them, consistent with your workplace setup.
Staying compliant with payroll laws is less about memorizing every statute and more about implementing reliable payroll controls—then adjusting for the state labor law requirements where your employees work. For a broader comparison and quick navigation to each jurisdiction’s rules, use Payroll laws by state.