What does gross pay mean on a pay stub?
4.9k views | Last modified 2/24/2023 9:28:15 AM EST | Added by 123PayStubs Team

Gross pay on a pay stub is the total wages an employee usually earns before payroll taxes and other deductions are taken out. For example, if the employee's gross pay is $50,000 for a year with a monthly pay schedule, then $50,000/12 is the gross wage for every pay period.

Gross pay is usually computed based on how the employee is classified in an organization, whether the employee is employed as an hourly or salaried employee. In the case of hourly employees, gross pay is calculated by multiplying the total number of hours worked with their hourly rate and adding bonuses, overtime, tips, and all sources of income.

Whereas, the exempt or salaried employee is paid their gross pay based on the agreed-upon annual salary divided by the number of pay periods. Reimbursements, other income, bonuses will also be added to the gross pay.

So, the paycheck that the employee receives after all taxes and voluntary deductions are taken from the gross pay is the net pay. You can find the gross pay at the bottom of the paystub in 123PayStubs.