Keeping your employees happy starts with running your payroll correctly. Nothing will get an employees attention quicker than a mistake in the payroll. In this report we cover all the different areas of payroll and how you can ensure your’s is running smoothly.
As an employer, you must pay your employees at the correct rate, as well as any entitlements they are eligible for. This includes parental leave, sick leave or overtime rates.
The wages and entitlements your employee is eligible for can depend on:
- their age
- the state where they work
- your industry
- their qualifications
- their work duties and responsibilities.
To help you work out what you need to pay your employees, the Fair Work Ombudsman (FWO) has created PayCheck Plus . You can use this online tool to calculate modern award pay rates for your employees, including:
- base pay rates
- overtime and penalty rates
- pay rates per hour
- pay rates for entire shifts.
National minimum wage in Australia
The new national minimum wage will now be $640.90 per week or $16.87 per hour. The increase only applies to employees that get their pay rates from:
- the national minimum wage
- a modern award
- a registered agreement (in some cases).
Using the Right Cloud Platform
Changes to tax tables, superannuation guarantee rates and any levies are all taken care of automatically, without the need to install any updates.
Streamlining payroll and super
Pay super contributions for your employees with the click of a button. File employee tax file number declarations to the ATO online via your cloud accounting software. File payment summary annual reports direct to the ATO from within your cloud accounting software.
Flexible but powerful
Multiple pay calendars allow you to pay your employees when you need to. Unlimited earnings, deductions, reimbursements and leave types to suit the needs of your business.
Easily track time and attendance and approve employees timesheets online, Minimise compliance risks and increase employee productivity. Employee hours seamlessly appear in your payroll for automated calculation and reporting minimising errors
What are you required to provide?
(gov requirements here http://www.fairwork.gov.au/pay)
Pitfalls of paying incorrectly
The Fair Work Ombudsman (FWO) regularly receives inquiries from employees claiming underpayment of wages. These inquiries often form the basis of the FWO’s decision to audit certain industries, as well as investigate individual businesses and employers regarding an employee’s claim that they did not receive the correct remuneration. This could be as a result of any employee being paid under the wrong award, classified incorrectly or not taking into account relevant allowances.
Employers have a legal obligation to correctly pay their employees the relevant remuneration, including penalties and loadings, overtime and allowances.
Therefore, it is essential that employers ensure every employee is paid correctly.
It also important for employers paying employees annualised salaries ensure that they are incorporating any wage increases (as part of the Annual National Minimum Wage Review) into the annualised salary to ensure that such salaried employee’s are better off in comparison to the applicable award. Paying an employee an annualised salary does not automatically exclude them from an award. Therefore, employers should also be aware of any variations to awards that may affect wage rates.
Any underpayment of wages or entitlements is a breach of Federal workplace laws and may incur penalties, as well as the obligation to pay back any money owing.
What happens if I discover an employee has been underpaid?
If you have established or suspect that an employee in your business has been underpaid their entitlements or wage, then you should call the Telephone Advisory Service immediately. It is free for members and an experienced Business Advisor can provide you with initial help. However, depending on the level of help required, our Workplace Relations Consultants can assist you on a fee for service basis and manage the entire approach, including wage calculations.
If it is found that an employee has been underpaid, the business will be required to pay back any entitlements owing. In addition, an underpayment of wages breaches the Federal Fair Work Act 2009 and there may be penalties that will be incurred.
What are the consequences with the FWO?
The Fair Work Ombudsman (FWO) can pursue a number of different courses of action if an employer has breached workplace laws and failed to pay their employees correctly.
This can range from a contravention letter, an audit, compliance or infringement notice or enforceable undertaking through to prosecution in Federal Court.
There is detailed information about the different types of action the FWO can take in the ‘Wage and Record-Keeping Requirements’ article.
What happens if the payroll is wrong?
(Reference http://www.fairwork.gov.au/pay/deducting-pay-and-overpayments and here http://www.fairwork.gov.au/pay/pay-slips-and-record-keeping/record-keeping)
Why do I need to provide a payslip?
What if I get the tax or super wrong?
In addition to the potential errors in running the payroll, let’s have a look at some other areas that impact the payroll if not done correctly.
(potential rostering reference material https://rosterplus.com.au/support/other-guides/good-rostering-according-to-tafe/important-things/ and https://rosterplus.com.au/support/other-guides/good-rostering-according-to-tafe/building-rosters/)
The impact of not scheduling staff on properly.
What happens if the hours are recorded incorrectly?
How can I stop my employee cheating the system?
(Potential reference material http://capitalismmagazine.com/2014/11/tax-avoidance-productiveness-employee-cheating/)
All the things you need to know about for payroll
You almost have to be superman to keep up with all the things you need to know about payroll
Wages and salaries
- Getting it right up front stops infringements and penalties
- Weekly, fortnightly or monthly
- These depend on the industry and award
- Penalties are high when employees super is not calculated correctly or paid on time.
Other payments such as salary sacrifice, workers compensation, bonus, maternity leave long service leave
There are a variety of other payments that may be required from time to time
- Applicable when your total wage bill exceeds a threshold amount
- Monthly lodgement required
- Applicable for taxpayers who make PAYG instalments.
- Generally monthly, but can be weekly for businesses with a large number of employees
- includes the PAYG instalment for the final month of the quarter
- Generally this is quarterly for small business
- A Tax employers pay on certain benefits they provide to their employees, including their employees’ family or other associates
- Annual Return required to be lodged
PAYG Payment summaries
- You need to give each of your payees a payment summary specifying how much you paid them in the financial year, and how much you withheld from the payments.
- You must send the ATO an annual report summarising all payments and amounts withheld for the year
- Annual lodgement