If only paying your employees was as simple as writing cheques or sending electronic payments. While the “payment” part could be that simple, the pay slip that goes with an employee’s payday is more complicated.
Fair Work regulations require these documents to contain very specific information. Paying employees is one thing, but providing prompt pay records with the correct information is a separate issue that companies must address.
Do you know what goes into the perfect pay slip? Keep reading to learn more.
What is a Pay Slip?
Your company’s pay slips are the personalised documents that accompany each employee’s payment within one working day of making payment. This document notes an employee’s wages over the pay period. The document can also include itemised deductions and contributions.
With each slip, an employee understands, amongst other things, their gross pay amount and the amount deducted from the total payment. The slip also shows an employee’s final net amount, or their “take-home” pay for the current pay period.
How Do Employers Generate Pay Slips for Employees?
- Employers can provide printed or electronic versions to employees. If you choose electronic delivery, it is a good idea to notify your employees when their pay has been actioned. If your employees prefer printed payments, you can provide a printed version.
- To keep good records and make sure you don’t forget anything on your employee pay slips, use a template. Electronic templates make it simple to follow the pay slip information requirements.
- Print or deliver pay slips electronically using your template. When using a template, make sure each employee’s information is accurate. Review critical personal and wage information for accuracy before saving and sending it to an employee. You never want the wrong employee’s information to go to a different employee.
No matter what template you use to generate pay notices, be sure your template includes all of the required information.
Make sure you file each slip for each employee. Electronic templates make it easy to keep accurate records without taking up space in file boxes or cabinets. Be sure to keep these records for a minimum of seven years as per the legislation. Missing information can lead to fines.
What Must Employers Include on a Pay Slip?
A template helps you include all of the required information on each employee’s slip. The Fair Work Regulations are very clear, and all employers must provide this information for each pay period to each employee.
Required information includes:
- The employee’s legal name (the office nickname doesn’t count)
- Your business name and Australian Business Number (ABN), if applicable
- Date of payment
- The pay period covered by the payment (day, month, and year)
- The number of hours worked by the employee
- The employee’s hourly rate (if applicable)
- The employee’s salary rate (if applicable)
- The gross payment amount
- The amount of any loadings, allowances, overtime, allowances, or bonus/commission payments
- Types and amounts of all deductions from the employee’s gross pay (taxes, penalties, etc.)
- The net amount of the payment (after deductions and additions)
- Details of any superannuation contributions involved in the pay period
- Any relevant Modern Award that applies to the employee
- Each employee’s employment status (full-time, part-time, or casual)
- An employee’s classification under the Award/Agreement
- The employee’s bank details
- The employee’s accrued leave balanceAfter those requirements, consider if it is appropriate to add a few more items below that are helpful to employees and for your record-keeping. The law doesn’t require these items, but they’re a good idea.
- Each employee’s employment status (full-time, part-time, or casual)
- An employee’s classification under the Award/Agreement
- The employee’s bank details
- The employee’s accrued leave balanceAfter those requirements, consider if it is appropriate to add a few more items below that are helpful to employees and for your record-keeping. The law doesn’t require these items, but they’re a good idea.
Using pay slips to provide a combined location where employees can check their current pay, YTD income, and their amount of leave is an excellent benefit for employees. It’s also an efficient way to keep your records up to date.
When Should Employers Issue a Pay Slip?
Fair Work regulations are very clear about when you must deliver a pay slip to each employee. Whether electronically or in print, employers must send these documents within one day of the pay date.
Any delay in delivering slips for a pay period can result in a fine.