Impact HR Blog


Annualised Salaries ; Your Checklist

31 August 2021

We appreciate that payroll responsibility can be a time-consuming process, however it’s really important to ensure that you are confident that your payroll system is compliant, up-to-date and reporting on time. Creating Annualised Salary Statements is one of those tasks where we can assist the reconciliation process and navigate any changes. To start, please download your Annualised Salary Checklist.

It’s time to check your records

As you may be aware, the government introduced Salary Annualisation legislation in March 2020. This means that all businesses are legally required to provide an Annualised Salary Statement at least once a year for all employees covered by a number of different awards. You will need to consider the following:

  1. Irrespective of whether or not you pay above the award rate, you still need to check your records and provide a statement.
  2. If there is any underpayment, backpay the employee.
  3. If there is an issue and you haven’t kept the required records for 7 years (including time, wages, leave, etc.) a penalty may apply and in some states wage theft is a criminal offence.
  4. Thankfully, there is technology to assist with the record keeping process, and this can be helpful when dealing with the task of Annualised Salary Statements.

What is an annualised salary or wage?

An annualised salary or wage is when you pay an employee a total amount for the year, which is broken down into equal amounts every pay period. This annual amount can compensate the employee for any additional payments they might be entitled to under their specific award such as loadings, overtime, allowances and penalties.

“Over-Award” doesn’t count

There were legislation changes in March 2020, whereby simply paying an employee an “over award” annual salary or wage is now insufficient, even if there is an off-set clause in their contracts.
Employers must have agreement in writing with their employees that they can pay an annualised salary.
Additionally, employers must be able to prove that the employee is better off under this Annualised Agreement (instead of Award Wage + Individual Award Entitlements).


It’s important to ensure you comply with the changed legislation, so ask yourself the following questions:

Q: Are you confident which award/s your team fall into?

Q: Are you confident of what your current process is?

Q: Do you pay (or wish to pay) any of those employees’ an annual salary or wage?

Q: Do you employ anyone under one of the awards listed:

  • Oil Refining and Manufacturing Award 2010 (non-clerical employees)
  • Wool Storage, Sampling and Testing Award 2010
  • Clerks – Private Sector Award 2010
  • Local Government Industry Award 2010
  • Telecommunications Services Award 2010
  • Contract Call Centres Award 2010
  • Hydrocarbons Industry (Upstream) Award 2010
  • Water Industry Award 2010
  • Rail Industry Award 2010
  • Salt Industry Award 2010
  • Mining Industry Award 2010
  • Legal Services Award 2010
  • Pharmacy Industry Award 2010
  • Pastoral Award 2010
  • Banking, Finance, and Insurance Award 2010
  • Broadcasting and Recorded Entertainment Award 2010
  • Horticulture Award 2010

We are here to help. We have the expertise to help you manage payroll. Please contact us to book your obligation free consultant with an Impact HR Payroll expert. To further assist with your Annualised Salary review, please download your free Annualised Salary Checklist

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