Under the table payment is a form of payment where an employer makes unofficial and undocumented payments to the employee. This form of payment is often in cash and is not recorded. As a result, tax is not deducted from the employee’s pay and it looks like a relief for the employer and the employee. No matter the reason for this form of payment, it is illegal and is treated as tax fraud. Both the employer and his employee are bound to face heavy consequences if they are discovered in such an act. Let us know more detail about ‘Can I Report My Employer For Paying Me Under The Table?’.
Can I Report My Employer For Paying Me Under The Table?
Like we’ve said, Payment under the table is illegal. Therefore, it is advisable to report your employer if he pays you under the table. The truth is that you might enjoy this form of payment because there are no deductions from your pay. But payment under the table puts you at great risk.
Is Payment Under the Table Illegal And Why?
Failure of an employer to provide the government with the employment details of an employee is seen as illegal because of the following reason;
– Tax payment is avoided
With this form of payment, the employer withholds tax due to the government. The law mandates employees to withdraw the state and federal taxes of employees from their payments.
– Employee’s human rights are violated
With this form of payment, the employer violates the human rights of citizens which is against the law. The employee has no one to fight for his rights. This affects the wages, insurance, overtime, and other benefits he receives.
– No records
The failure of employers to provide the government with employee data is against the law. This is not possible because there are no records in this form of payment. The form of payment is also used to carry out illegal transactions because there are no records of the transaction. This may implicate the parties involved in some situations.
Why You Should Report Your Employer If He Uses This Form Of Payment?
The risks involved in receiving payment under the table include;
– Loss of worker’s benefits
Benefits such as health insurance, disability insurance, unemployment endurance, worker’s leaves, breaks, etc are not available to employees under this form of payment.
– Lack of records
This puts you in some security reasons because there is no proof that you are into a legal business transaction. Also, you cannot receive benefits such as loans from financial institutions.
– Inability to report employer when he tramples on your rights
When you receive such payments, you’ve cut yourself away from external bodies that help fight for employee’s rights. Some of these bodies include Legal agencies and various worker associations.
Since the government does not know your employment details, the employer could pay his desired wages and may not pay for overtime.
– Tax accusations
If your employer does not pay your tax, the government can accuse you of withholding your tax. This is no small offense and could attract jail terms or huge fines.
Reasons Why Employers Pay Employees Under The Table
– To save money by avoiding employer’s benefits
– Avoid paying excess insurance fees.
– Hire unprofessional employees
– To avoid paying for employee’s tasks
– Save the time of preparing the necessary paper works.
– Carry out illegal business transactions
How To Report Your Employer For Under-The-Table Payment?
To report your employer through the local government authority, you need to visit the Wage and Hour office in your region. You will need to provide these pieces of information;
– Personal details – your full name, home address, phone number
– Company details – company’s name, company address, and company phone number.
– Work description – Details about your job and roles in the company.
– Payment details – Mode of payment, total earning, payment period.
– Complaint – Illegal payment description with the date(s), and amount
If My Employer Wants To Pay In Cash
It is possible to receive payments from your employer in cash. It is a more difficult process for record purposes and accurate tax payment requirements. However, if an employer wishes to pay in cash, he must provide the government agencies with the following details;
- Employee’s details- Name, address, phone number, and last four figures of employee social security number.
- Company details- Company’s name, address, and business type
- Payment details- Employee’s net earnings, gross earnings, payment period
- Job Details: Job description and hours of work
- Tax deductions
- Employees benefits.
Now we have learnt ‘Can I Report My Employer For Paying Me Under The Table?’, When you take a deep look into the nature, personal losses, and risks involved in the under-table payment method, you discover that it is not worth it. You have every right to report your employer if he pays you through this means. Cash payment is the main method of under-the-table payment but that doesn’t make it illegal. If your employer wishes to pay you in cash, ensure it is done through an approved process.