Are you being underpaid? How to make sense of your payslip
The increase to the minimum wage for industries including retail and hospitality came into effect on February 1, but how can you make sure your employer is paying you what you're owed?
So far this year, one in five callers to JobWatch have raised issues of underpayment. It is clear that many people are not aware of how to check their pay entitlements throughout their employment.
It's critical that people review their payslips regularly to ensure that they are being paid correctly and on time. In addition to the basic employer and employee information that should be on every payslip, there are five things that people should look for to ensure that they are not being underpaid - rate of pay, hours worked, superannuation, deductions, and additional payments.
1. Rate of pay
The Fair Work Commission sets a federal minimum wage for employees not covered by a modern award or enterprise agreement, junior employees, apprentices and trainees, and employees with disabilities. It is unlawful to be paid at a rate below what is set by the Fair Work Commission.
You may be paid a higher rate of pay under your common law employment contract, so make sure that the rate of pay on your payslip matches what is in your contract.
2. Hours worked in the pay period
Each payslip should include the number of hours you worked in the pay period, multiplied by your rate of pay to show the total dollar amount of pay for that period. The pay period should be clearly marked, for example, January 4, 2021-January 11, 2021.
Check these against your own records to ensure that you are being paid for the work you do, but note that in some common law contracts, some 'reasonable additional hours' may be included in a total remuneration package, provided applicable minimums are satisfied.
If you earn $450 or more in a month and are aged 18 or over, your employer must pay a percentage of your ordinary time earnings into your super account. This is called the super guarantee. Currently, the super guarantee is 9.5% of your earnings, but this will increase to 10% on July 1, 2021. It doesn't matter if you work casually, permanently, or are a temporary resident - all workers must be paid superannuation if they meet the income and age requirements.
Make sure your payslip details how much superannuation your employer is paying and check with your super fund to ensure the funds are being received.
4. Tax and other deductions
If you earn over $18,200 per year, your employer will deduct tax from your pay at a rate governed by the Australian Tax Office. These rates may differ depending on whether you are a foreign resident for tax purposes. Other deductions may include HECS-HELP debt payments or approved salary sacrifice arrangements. It should not include deductions that you have not given written consent to - for example, uniforms.
Check to make sure that there are no unlawful wage deductions in your payslip, and that any lawful deductions are accurate. Note that your payslips should include not only your net pay after deductions, but also your gross pay before deductions.
5. Loadings, allowances, bonuses, penalty rates, and other entitlements
Payslips should also include any additional payments that you have received during that pay period, including casual loading, allowances (e.g. mobile phone allowance), bonuses, commission, penalty rates, or anything else that is additional to your regular pay.
If you are not a casual employee, it is good practice to have your leave balances included on a payslip, but it is not an ATO requirement. If your payslip does not show your leave balances, you can ask your employer to tell you what your leave balances are.
Check your payslip to ensure that you are being paid any additional payments that you are entitled to, including additional payments that might be detailed in your modern award, enterprise agreement, or common law contract.
What if something doesn't look right?
Contact the Fair Work Ombudsman at fairwork.gov.au or a support service such as JobWatch on 1800 331 617 (regional VIC, QLD, TAS) or 03 9662 1933 (metropolitan Melbourne).
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