Fair Work has imposed rules on employers regarding employee pay slips. A breach of these rules can result in Fair Work Inspectors issuing an infringement notice to employers, or in more simple terms, a hefty fine. Pay slip rules can be found in Section 536 of the Fair Work Act 2009 but in summary, employers are expected to do the following:

  1. Issue pay slips within one day of payment;
  2. Ensure pay slips are accessible to all employees, even to those who are on leave;
  3. Ensure all relevant information required by Fair Work is visible on the pay slips; and that
  4. Pay slips have to be in either electronic form or hard copy. Electronic pay slips must have the same information as paper pay slips.

Pay Slip Compliance

Fair Work advises pay slips have to cover details of an employee’s pay for each pay period which include;

  • employer’s and employee’s name
  • employer’s Australian Business Number (if applicable)
  • pay period
  • date of payment
  • gross and net pay
  • if the employee is paid an hourly rate:
    • the ordinary hourly rate
    • the number of hours worked at that rate
    • the total dollar amount of pay at that rate
  • any loadings (including casual loading), allowances, bonuses, incentive-based payments, penalty rates or other paid entitlements that can be separated out from an employee’s ordinary hourly rate. For example, a note could be included on a pay slip that the hourly rate incorporates the relevant casual loading.
  • the pay rate that applied on the last day of employment
  • any deductions from the employee’s pay, including:
    • the amount and details of each deduction
    • the name, or name and number of the fund / account the deduction was paid into
  • any superannuation contributions paid for the employee’s benefit, including:
    • the amount of contributions made during the pay period (or the amount of contributions that the employer intends to make)
    • the name, or the name and number, of the superannuation fund the contributions were (or will be) made to.
  • When an employer is required to give a new employee a pay slip within 14 days of their first pay day, they don’t have to include the superannuation fund name or number if:
    • the employee hasn’t notified the employer of their choice of superannuation fund
    • the employer hasn’t been able to obtain the employee’s stapled superannuation fund details from the Australian Taxation Office (ATO).

Please note that whilst its best practice to show an employee’s leave balances (Annual Leave, Personal Leave and Long Service Leave) on their pay slip, it is not a requirement.

Modern Award – Payroll Cycle

If it also important that you check your Modern Award to ensure you pay wages in accordance with the required payroll cycle.

Please note that there is flexibility how you pay the employee – cash, cheque or by electronic funds transfer but if you are paying cash or cheque, there are further instructions on how to manage payment of wages in the event an employee is not working on the particular pay day.

Here is a summary of the required pay cycles but please look at the actual clause in the relevant Award to determine if there are any other requirements imposed on your business;

Clerks Private Sector Award – Clause 17 Employer may determine the pay period of employees as being either weekly or fortnightly. However, it can be monthly if mutually agreed but if so, payment must be made on the basis of 2 weeks in advance and 2 weeks in arrears.
Commercial Sales Award – Clause 16 Employees will be paid weekly, fortnightly or monthly.
Road Transport and Distribution Award – Clause 18

All earnings, including overtime, must be paid weekly in the employer’s time on a day to be fixed by the employer. Payment will be no later than Thursday.

Once fixed, the day must not be altered more than once in 3 months.

All earnings, including overtime, must be paid within 4 business days of the expiration of the week in which they accrue.

Timber Industry Award – Clause 21

Wages will be paid either weekly or fortnightly, either according to the actual ordinary hours worked each week or fortnight; or average number of ordinary hours worked each week or fortnight.

By mutual agreement, wages may also be paid 3 weekly, 4 weekly or monthly.

For further advice on ensuring payslip compliance, please contact HRAnywhere on 1300 208 828 or email info@hranywhere.com.au.

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