Money and Work
Every line on that pay stub means something. Here is what.
Last updated April 2026 | Sources: twc.texas.gov, dol.gov, irs.gov
Gross pay is the total amount you earned before anything is taken out. Net pay is what hits your bank account. The difference is deductions.
Federal income tax: withheld based on your W-4 form. The more allowances you claim, the less is withheld. If too little is withheld, you owe at tax time. Too much, you get a refund.
Social Security (FICA - OASDI): 6.2% of your gross pay, up to $168,600 per year. Your employer pays another 6.2%. This funds retirement and disability benefits.
Medicare (FICA - HI): 1.45% of your gross pay with no income cap. Your employer matches this.
State income tax: $0 in Texas. This line will not appear on your stub. Texas is 1 of 9 states with no state income tax.
Other deductions might include health insurance premiums, retirement contributions (401k), union dues, or garnishments (court-ordered). If you see a deduction you did not authorize, ask your HR department in writing.
The Fair Labor Standards Act (FLSA) requires overtime pay of 1.5 times your regular rate for every hour over 40 in a workweek. A workweek is any fixed 168-hour period (7 consecutive 24-hour days).
Your employer cannot average hours over 2 weeks. If you work 50 hours one week and 30 the next, you are owed 10 hours of overtime for that first week.
Some jobs are exempt from overtime: most salaried executive, administrative, and professional workers above the salary threshold. But job title alone does not determine exemption -- it depends on actual duties.
Tipped workers have different rules. In Texas, the tipped minimum wage is $2.13 per hour, but tips plus wages must equal at least $7.25 per hour. If they do not, the employer must make up the difference.
If you are fired or laid off, Texas law requires your employer to issue your final paycheck within 6 calendar days.
If you quit, your final paycheck is due on the next regularly scheduled payday.
Your final paycheck must include all earned wages, including unused accrued vacation if your employer's written policy promises payout. Texas does not require vacation payout by default -- it depends on company policy.
If your employer does not pay on time, file a wage claim with the Texas Workforce Commission. There is no fee. You can file online at twc.texas.gov or by calling 800-832-9243. The TWC investigates and can order your employer to pay.