Payslip Explained | Get familiar with everything on your payslip

As an employee of a company, it is important that you learn to understand your payslip. Your salary is your income and if there are errors, for example, you need to be able to identify them and get them corrected. By understanding your payslip, you can manage your finances better and get an overview of your income.

However, a payslip is not easy to understand. It contains many concepts that it is a good idea to familiarize yourself with if you want to understand your payslip. That's why we've created this guide to help you understand your payslip.

In this guide, you will learn about concepts such as AM contribution, ATP, holiday pay, supplements, and the other elements that make up your payslip.
6. March 2023  • 4 minutes reading time

What is a payslip?

A payslip is a record of what you have earned in a given period. You will typically receive your payslip a day before or on the day your salary is paid.

The payslip gives you an overview of how much you have worked, the supplements you have received, and the various deductions and contributions that you pay as an employee in the country where you live. We will discuss these in more detail here.

What does a payslip contain?

First of all, your payslip contains basic information about you - your name, address, and civil registration number. The payslip also contains information about your employer, their address, and company registration number.


In addition, the payslip contains an overview of the period it covers and how much you have worked during that period. After the basic information, you could say that the payslip contains a big calculation. The result of that calculation is the amount of money that ends up in your account.


However, there are some elements of the calculation that are not easy to understand. We will explain them one by one.

Is my employer required to give me a payslip?

Absolutely! According to the Payment of Wages Act 1991, all employees have the right to receive a payslip. Additionally, starting in April 2019, The Employment Rights Act 1996 (Itemised Pay Statement) (Amendment) Order 2018 mandates that employers include the number of hours being paid out on an employee's payslip.

However, there are some exceptions to this rule. Individuals who are not considered employees, such as freelancers and contractors, are not entitled to receive a payslip.

Your payslip explained - All information that's typically found on your payslip.

The employee's name and address

This is the name and address of the employee receiving payment for their work during the payment period.

The employer's name and address

This is the name and address of the employer responsible for issuing payment to the employee.

The payment period covered by the payslip

This refers to the specific time period for which the employee is being paid, such as a week, a month, or a specific date range.

The employee's gross pay before deductions

This is the total amount of money earned by the employee for the payment period before any deductions are made.

Any deductions from the gross pay such as taxes, national insurance, pension contributions, etc.

This section shows any deductions that have been made from the employee's gross pay, such as taxes, national insurance, pension contributions, or any other deductions required by law or specified by the employer.

The employee's net pay after deductions

This is the amount of money the employee will receive after all deductions have been made from their gross pay.

The total amount of tax paid in the current tax year

This shows the total amount of tax paid by the employee for the current tax year, up to the payment period covered by the payslip.

The employee's tax code and national insurance number

This section displays the employee's tax code and national insurance number, which are unique identifiers used by tax authorities to track an individual's tax obligations.

The total number of hours worked in the payment period (depending on the country or region)

This section displays the total number of hours worked by the employee during the payment period, which may be required by law or specified by the employer. 

Note that this subject may not be included on all payslips, as it depends on the country or region where you work.

Standard hours

Standard time is your normal working time. These are the hours agreed in your contract. 

Note that this subject may not be included on all payslips, as it depends on the country or region where you work.


Overtime is any work you have done in excess of your normal working hours. On your payslip, you will see how much overtime you have worked and the rate at which overtime is paid.

Note that this subject may not be included on all payslips, as it depends on the country or region where you work.


Allowances are the salary you receive in addition to your basic salary. This could be, for example, allowances for overtime, working on public holidays, or weekends. You may also receive seniority allowances if you have worked in the same place for a longer period, or other allowances you have negotiated based on your qualifications, for example. Your payslip will show you the rate for the type of allowance you have received.

Note that this subject may not be included on all payslips, as it depends on the country or region where you work.

Why is it important to be able to understand your payslip?

It is important that you learn to understand your payslip because it gives you an overview of your income and thus the basis of your finances. If you don't understand how to read your payslip, you may miss errors such as the number of hours you have worked. This can lead to missed pay or deductions.

Your payslip also contains other information that is good to keep up to date for various reasons. For example, when your salary will be in your account, how much you earn from overtime or how much money you have earned in pension.

Manual time tracking can lead to errors on your payslip.

For hourly paid positions, the payslip can lead to disagreements between employees and managers. This is because it can be difficult to keep track of how much an employee has worked, what hours have been worked overtime, and similar factors.

For example, if two employees have swapped shifts internally, this may not necessarily be recorded in the work schedule. This can lead to incorrect registration of the hours worked and the employee may miss out on pay or be overpaid.

Use a digital solution for accurate time tracking.

When your employer uses a workforce management system like Workfeed to take care of shift planning and time tracking, a lot of disagreements between employers and employees can be avoided. It also allows everyone to have more overview and provides more transparency.

Is your employer not using a digital solution like Workfeed? Introduce your employer to Workfeed and receive a giftcard of choice ($50) if they become a customer.

With Workfeed, you're guaranteed an error-free payslip.

When the salary is due, the employer does not have to manually export the work schedule and import it into the payroll system. Workfeed can be integrated with the payroll system so that the payroll is automatically synchronized. With one click of a button, the hours are sent to payroll. As an employee, you can also continuously monitor your gross salary from the Workfeed app.

1. Avoid mistakes

Workfeed's workforce management system can ensure that all employees always receive a correct payslip. This is because hours, allowances, and absences are recorded digitally, so there are no errors during manual entry.

2. Save time and resources.

Using Workfeed means you don't have to spend time manually recording changes to your work schedule. All the employer has to do is approve the changes and Workfeed will make sure they are recorded correctly. When it's time to send the hours to payroll, the employer only needs to click one button.

3. Choose a system that is loved by everyone.

Workfeed is loved by employers and employees across the globe, earning an overall rating of 4.7 out of 5 possible stars on Trustpilot. It's a guarantee that your workplace is choosing a workforce management solution that works.

Frequently asked questions about payslips.

According to payslip laws, employers are required to provide payslips to their employees either on or before the day they are paid. The specific payday schedule may vary depending on the company, as some businesses pay their employees on the same day each month, while others pay every week, bi-weekly, or every four weeks.
By reading this guide and getting to grips with the elements of your payslip, you can become an expert in reading your payslip.
If there is an error on your payslip, you should contact your employer and inform them of the error. If you are an hourly paid worker, it is a good idea to keep track of how much you have worked to ensure that you do not miss out on any pay or allowances.
Kristian Emil Larsen - Workfeed Author
Berry van Waarden
Head of Marketing

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