50 Fun Facts About Payroll

Per US survey figures on the Wikipedia payroll page, which pay frequency do about 46% of employers use?

That means 26 pay periods a year. Weekly is next at about 32%, semi-monthly 18% and monthly under 5%.

How many pay periods does a semi-monthly payroll produce in a year?

Two pay dates per month. Biweekly produces 26, which is why some months have three paydays.

What is the term for an employee's total earnings before any taxes or deductions are taken out?

For hourly workers it is simply the rate multiplied by regular hours, before overtime and deductions.

FICA payroll taxes fund which two federal programs?

The Federal Insurance Contributions Act tax is paid by both employees and employers and sits in Chapter 21 of the tax code.

Since 1990, the employee's Social Security share of FICA has been what percentage of pay?

The employer matches it. It applies only up to the Social Security Wage Base, which rises each year with average national wages.

The employee's Medicare portion of FICA is 1.45% of wages, applied up to what limit?

Unlike the Social Security portion, every dollar of wages is subject to the Medicare tax.

By what date each year must US employers get Form W-2 to their employees?

The 'Wage and Tax Statement' reports wages paid and federal taxes withheld, giving workers time before the April 15 filing deadline.

Which IRS form does a new employee fill out to tell the employer how much tax to withhold?

Its official title is the Employee's Withholding Allowance Certificate; historically, more allowances meant less withholding.

Until 2025, a business had to file a Form 1099 for contractors paid over what in a year?

The $600 threshold dated from 1954; for payments made after 2025 it rose to $2,000, indexed to inflation. The forms also cover rent, interest, dividends and other non-wage income.

The Fair Labor Standards Act of 1938 requires overtime pay after how many hours a week?

The same law created the federal minimum wage and banned 'oppressive child labor'.

The first US federal minimum wage, set in 1938, was how much per hour?

About $5.72 in 2025 money. Large parts of the workforce were exempt, and the rate was obsolete by the end of World War II.

The federal minimum wage has been $7.25 an hour since which year?

The Fair Minimum Wage Act of 2007 phased in the increase over three steps.

What is the federal direct cash wage per hour for tipped employees?

The figure has been frozen since 1991; the employer must make up any shortfall.

In which year did the Current Tax Payment Act reintroduce US income tax withholding from paychecks?

Withholding had first appeared in the 1913 Tariff Act and been repealed in 1916. Wartime revenue needs brought it back.

The Social Security Act was signed by Franklin D. Roosevelt on August 14 of which year?

Labor Secretary Frances Perkins led the committee that drafted it. It also created unemployment insurance and Aid to Dependent Children.

Social Security numbers were first issued in which month and year?

More than 1,000 post offices were designated 'typing centers' to produce the cards, which were then sent to Washington.

How much was the first recurring monthly Social Security check, issued in 1940 to Ida May Fuller?

She had paid in for just three years, lived to 100, and collected about $22,000 in benefits.

Medicare, funded partly through payroll tax, began in which year?

It started under the Social Security Administration and is run by the Centers for Medicare and Medicaid Services.

The Sixteenth Amendment, allowing a federal income tax, was ratified on February 3 of which year?

Congress imposed the tax almost immediately with the Revenue Act of 1913, sponsored by Oscar Underwood.

The office that became the IRS was created in 1862 to collect an income tax funding what?

The Office of Commissioner of Internal Revenue assessed the nation's first income tax; the commissioner still serves a five-year term.

Section 401(k) of the Internal Revenue Code was enacted as part of the Revenue Act of which year?

Benefits consultant Ted Benna was among the first to build a plan on it, at his own employer, the Johnson Companies.

The company now known as ADP was founded in 1949 by Henry Taub under what name?

It began as a manual payroll bureau in New Jersey, added punched cards in 1957 and became Automatic Data Processing the next year.

Where is ADP headquartered?

The company operates in more than 140 countries. Rochester is Paychex's home; Pleasanton is Workday's.

Paychex was founded in 1971 by Tom Golisano with how much starting capital?

The Rochester, New York company now serves roughly 800,000 payroll clients in the US and Europe.

The UK's PAYE system of collecting income tax through payroll was introduced in which year?

Devised by Sir Paul Chambers after trials in 1940-41, its wartime origins still shape how it works.

The word 'salary' derives from the Latin salarium, which is itself derived from the word for what?

The popular story that Roman soldiers were paid in salt is doubtful; they were paid in coin, though salt allowances may have been part of it.

Willard Bundy, who invented an early time clock in 1888, worked as what?

His brother Harlow set up Bundy Manufacturing to mass-produce them; the business was folded into International Time Recording in 1900, an ancestor of IBM.

In which country's English is a time clock commonly called a 'bundy clock'?

The name comes from brothers Willard and Harlow Bundy. 'Bundy on' and 'bundy off' mean clocking in and out.

US law generally caps ordinary wage garnishment at what share of weekly disposable earnings?

Or the amount by which weekly pay exceeds 30 times the federal minimum wage, whichever is lower. Child support and student loans have different limits.

The federal unemployment tax (FUTA) applies only to the first how much of each worker's annual earnings?

Once a worker passes that figure, the employer owes no more FUTA for them that year. The base rate is 6.0%, before state credits.

An Employer Identification Number issued by the IRS has how many digits?

The same length as a Social Security number. Before 2001 the two-digit prefix indicated the business's geographic area.

The 2020 Paycheck Protection Program was created by which piece of legislation?

The $953 billion loan program helped businesses keep workers on payroll; one estimate says it cut mortgage delinquencies by $36 billion that year.

In which year did John F. Kennedy sign the Equal Pay Act, outlawing sex-based wage disparity?

It was signed on June 10, a year before the Civil Rights Act broadened workplace protections.

The Bureau of Labor Statistics traces its origin to an 1884 bureau within which department?

It is now part of the Department of Labor and produces the Consumer Price Index and jobs reports that drive pay decisions.

In which country is payroll tax the primary source of revenue, over a third of the national budget?

The island has no income tax, so employers pay a levy on wages and may deduct a small share from staff.

Roughly what share of all US company scrip was issued by coal companies in Kentucky, Virginia and West Virginia?

Scrip could only be spent at the company store, the arrangement Tennessee Ernie Ford sang about in 'Sixteen Tons'.

Paying workers in goods, credit at a company store or tokens instead of money is known as what?

Britain's Truck Acts tried to outlaw it, yet it survived into the 20th century.

Being paid a fixed rate for each unit produced, regardless of time taken, is called what?

It is common in agriculture, garment production, translation, data entry and call centres.

In which year did Robert Owen coin 'Eight hours' labour, eight hours' recreation, eight hours' rest'?

He had already introduced a ten-hour day at his New Lanark mills in 1810. The eight-hour day took another century to become normal.

When was the UK's Payroll Giving (Give As You Earn) scheme introduced?

Because the donation comes off before tax, the charity does not need to claim Gift Aid on it.

The OED traces the first use of 'weekend' to a British magazine in which year?

The magazine was Notes and Queries. The five-day, 40-hour week took decades more to spread.

What is the document listing wages, taxes and deductions with a payment most commonly called in the US?

In Britain it is a payslip. Each country's law dictates what it must show.

How many hours does a standard semi-monthly payroll period contain?

Semi-monthly pay, used by about 18% of US employers, typically lands on the 1st and 15th or the 15th and last day of the month.

Which type of deduction is a wage garnishment?

Because it comes out after taxes, a garnishment does not lower an employee's taxable income.

Freelancers and independent contractors pay FICA-equivalent tax under which 1954 law?

The full 15.3% rate is applied to 92.35% of net earnings, which mirrors the employer-half deduction regular workers get.

What do Amish or Mennonite workers file to seek exemption from FICA tax?

Applicants waive all Social Security benefits and certify membership of a group religiously opposed to insurance.

What did the Supreme Court unanimously rule in 2014 about severance pay?

The case was United States v. Quality Stores, Inc.

In which country are payroll taxes levied by state governments rather than nationally?

Rates and thresholds differ from state to state.

What was the employer's Swedish social security contribution rate in 2018?

It is calculated on top of the employee's salary, with lower rates for older employees.

Which Canadian territory charges a 2% payroll tax paid directly by employees?

Ontario instead applies a health premium on a sliding scale of up to $900 a year.