Managing Farm Payroll

Employee records should include the information listed below and be filled in during an employee Induction and updated, as required.

• Employees Details Form 
• if you and your employee have agreed to an Individual Flexibility Agreement, a copy of the agreement.
• leave taken and any Leave Application forms
• leave balance 
• a record of the employee’s Super Fund Choice and the date they made that choice 
• a copy of the employee’s Tax File Number Declaration
• signed copy of the Offer of Employment
• signed copy of any induction or WHS training received
• Payslips; for a full list of information required on payslips and a sample payslip, download the Model Payslip and Information Sheet.
• if overtime is worked, a record of the number of hours worked, or the starting and finishing times of the overtime. 

Tax and superannuation

Tax

When you pay employees, you need to withhold tax from their pay and send these amounts to the Australian Taxation Office regularly. For each new employee, you will need to: 

• give them a Tax file number declaration (NAT 3092) to complete and return to you  (note – this form is updated annually so make sure you have the latest version before giving it to your employee)
• complete Section B of your employee’s Tax file number declaration 
• register for PAYG withholding (if you haven’t already)
• forward the completed original of the Tax file number declaration to the ATO within 14 days of the employee’s start date 
• keep records of all tax deducted and send payments to the ATO 
• issue Payslips and payment summaries (group certificates)

The Australian Tax Office have a range of tax tables and a tax withheld calculator tool to help you work out the amount of tax you need to withhold from your employees. There is also an app for the ATO that acts as a simplified version of the calculator and can be downloaded through Google play, Apple App store or Windows store.

If you don’t have access to the internet, or need more information about the correct amount of tax to withhold, phone the Australian Taxation office on 13 28 66.

Superannuation

Under the superannuation guarantee law you must pay super contributions for your eligible employees, at a minimum rate of 9.5% of their ordinary time earnings for the current payroll year until 30 June 2021. After this, the superannuation guarantee increases by 0.5 % points each year until it reaches 12% (see table below, source ATO).

You have to make payments at least four times a year and the cut-off dates are 28 days after the end of each quarter.

• employees paid a salary or wage of less than $450 in a calendar month;
• employees under 18 years of age and working less than 30 hours per week; or
• employees paid to do work of a domestic or private nature for not more than 30 hours a week, for example, a part-time nanny or housekeeper.

Employees who are eligible for super can choose the fund you pay into. You should give employees a copy of the Superannuation Standard Choice Form which lets them tell you the details of their preferred super provider.

If they don't make a choice, you must pay their contributions into your employer-nominated or default fund.   All awards contain details of the default funds for that industry. Note: after 1st July 2016, everyone must use the Superannuation Clearing House (see box above). 

Timesheets

By law employers only have to keep records of hours of work and starting and finishing times if overtime is worked or if the employee is a casual employee or an irregular part time employee with a guaranteed pay rate for the hours worked. However it is advisable to keep accurate records of all hours worked. Keeping accurate records is important for other reasons too. The hours a person works on average each week can have a significant impact on their work-life balance.

Unreasonable hours and a feeling of being overworked and under appreciated can lead to poor morale and make it harder to keep or motivate your employees. The Modern Awards and National Employment Standards provide details on ordinary hours of work and overtime. (See also How do I Train and Grow my Team for more information about retaining employees and on-the-job morale.)

There are a couple of simple ways of keeping track of employees’ hours of work:

• keep a time and wages book (click here for a sample); or
• use our Time Sheet Template

Payslips

The list of information you have to include on a pay slip can seem a bit scary at first glance. However, if you have followed the Induction Checklist and Employment Checklist, you should have all the documents you need already. You can use the Model Payslip provided and / or an excel spreadsheet or manual sheet from your Accountant to help you. See the Model Pay Slip and Information Sheet in the resources section below for a complete list of all the information you must include on employee payslips. 

It’s good to show leave balances on employee pay slips but you don’t have to do this. However, you must tell your employees their leave balance if they request it. Calculating leave can be so much simpler if it is done regularly and included on a pay slip.

You can only deduct money from an employee's pay if the employee has agreed to it in writing and the deduction is for the employee’s benefit. Use this Authority to Deduct Form. Employees who are under 18 years must have the form signed by a parent or guardian.

There are penalties for failing to provide pay slips, or for not including the required information on pay slips. Serious or ongoing breaches may result in court action.

You can provide payslips electronically or on paper but electronic payslips need to be emailed to employees individually, not just stored where they can be accessed.