FINANCIAL LITERACY
By law all employees in Australia must receive a payslip for each period they are paid.
For example, if you get paid weekly for your job, you should receive a payslip weekly. Similarly, if you get paid monthly, you will receive a monthly payslip and so on.
Paying attention to your payslip is part of taking responsibility and being accountable for being paid correctly for the work you do. Yet many employees either do not fully understand their payslips, or do not take the time to read them. This blog aims to help you better understand the basic elements of a payslip, why you should check your payslips regularly and store them securely.
Payroll is also complicated and in this particular blog we are only touching on payroll concepts requiring mention in relation to payslips.
Why do payslips matter?
Whether you are a casual or part time or full time employee, it is important for you to understand what a Payslip is and what it tells you about your earnings.
Payslips are proof of your employment. Generally financial institutions require a loan applicant to show their payslips when applying for a loan or mortgage and there are several other situations such as applying for a rental property lease where your Payslips will be requested.
The payslip gives an indication of the applicant’s income and financial stability.
If you are getting overpaid or underpaid by your Employer the onus is on you to keep an eye on what you are paid. If you are employed as a casual your employer does not need to give you an employment agreement, although it is good practice and many employers do.
There is a lot of information that must be on your Payslip.
The Payslip below shows The Employee Name (Beyonce), the name of her Employer (Coffee A Gogo), the dates covered by the pay period(1.7.22 – 7.7.22), the hours she worked, the rate/s of pay and the pay amount at each applicable rate (applicable loadings and overtime).
There is a total of the gross wages which are the wages before tax ($1354.20).
Then the Payslip will show any taxes and deductions on the gross wages ($285.00).
The Payslip shows the Net payment to the Employee which is the Gross wage less any taxes and other deductions. The Payslip will show details (Superannuation Fund name or number) of any Superannuation fund and the amount of any superannuation payment. Superannuation will be covered in another blog. Please remember that just because a superannuation payment is shown on your Payslip does not mean it has been paid to the superannuation fund. You must log into your superannuation or contact them and check this.
The Payslip below is a simple one designed to illustrate the basic Payroll concepts. There are many different loadings, taxes and deductions that may apply.
A lot of Payroll software gives employees access to their full payslip history which is great for people who do not love doing their own record keeping, but for most employees the onus is still on you to keep and file your Payslips when you receive them.
You must make sure you pay attention to this. It is part of being personally accountable.
You need to be aware of your rate of pay, for example, your hourly rate or your salary.
Your employer must by law pay you superannuation. The details of that are outside this blog but will be covered in an upcoming blog.
More information
The Fair Work Act 2009 currently administrates employer and employee relations in Australia. The Fair Work Act issued National Employment Standards. Each state in Australia chooses how they will administrate employment.
Fairwork Australia administrates payroll in Australia and their website is a great source of information: www.fairwork.gov.au
