Tag: employer

payroll

Small Business Superannuation Clearing House Changes

Posted on | by Allan Hall

Actionable Update to SMSF Bank Account Validation

ATO update introduces SMSF bank account validation aimed at improving the precision and security of superannuation contributions

Given the proximity of the next SG contribution deadline on 28 April 2024, it is important to take action ahead of this date to prevent potential compliance issues.

Key points

  • The ATO implemented a pivotal update within the Small Business Superannuation Clearing House (SBSCH) on 15 March 2024
  • This new system feature affects all small employers who use the SBSCH to pay superannuation to employee SMSFs
  • The ATO’s validation process requires small employers using the SBSCH to ensure perfect alignment between their employees’ SMSF bank account details and the corresponding fund bank account details recorded by the ATO
  • The validation focuses on the BSB and account number as registered under the SMSF’s Superannuation Role within ATO systems. For any employee where there is no exact match, the SBSCH will not process their superannuation payment.

Action Required: Review Employee Records

The ATO is contacting small employers likely to be impacted by the new SBSCH SMSF bank account validation process.

However, with SG obligations for the March 2024 quarter due no later than 28 April 2024, it is important for small businesses to act proactively.

If you are a small business using the SBSCH, it is important that you contact your employees to confirm that the SMSF bank account they pay superannuation contributions to, is the same as the SMSF bank account registered against the superannuation role with the ATO.

Where employees are unsure how to check if the bank account their employer makes super contributions to is the same as the one registered with the ATO, please contact Allan Hall for assistance on 02 9981 2300.

Should there be a need for an employee to amend SMSF bank details held by the ATO, it is crucial to communicate these changes to all fund members as the ATO will issue email or text alerts to ensure all fund members are informed.

Small employers delaying the review and update of their employees’ SMSF bank records risk facing SG shortfalls and potential penalties as there may be insufficient time to rectify a discrepancy.

CONTACT ALLAN HALL ACCOUNTANTS & BUSINESS ADVISORS

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Workplace Gender Equality Agency Reporting

Workplace Gender Equality Agency Reporting

Posted on | by Allan Hall

WGEA Reporting or Pay Secrecy

Workplace Gender Equality Agency (WGEA) has published the 2022-2023 median gender pay gaps for private sector businesses with 100 or more employees, encompassing both base salary and total remuneration.

Some notable findings include:

  • 30% of employers have a median gender pay gap between the target range of -5% and +5%
  • 62% of median employer gender pay gaps are over 5% and in favour of men
  • The remaining (8%) are less than -5% and in favour of women
  • Across all employers, 50% have a gender pay gap of over 9.1%. 

The above findings suggest that there is still a large gap between gender pay equality with only 30% of businesses within the target range. This is largely demonstrated by the statistic that 62% of employers are currently paying men over 5% more than women across the business. 

Who needs to complete an annual WGEA report?

All private sector businesses with 100 or more employees are required to complete their WGEA report between 1 April and 31 May of each year. The report must provide data from the previous year for the date ranges of 1 April through to 31 March. 

For more information about who needs to report and how to complete the WGEA report, please click:

WGEA EMPLOYER PORTAL

Even if your company has fewer than 100 employees, it is important to be proactive in identifying potential inequalities within the workplace. Conducting a payroll audit and internal salary benchmarking are important steps to take. 

How does pay secrecy impact gender pay inequality? 

Pay secrecy can play a big part when it comes to gender inequality in the workplace. Pay secrecy, where employees are prohibited from discussing their pay, hampers transparency and can conceal gender-based pay disparities. For this reason, changes have been made from 7 December 2022 to remove the permittance of pay secrecy clauses within contractual agreements. This change aims to advocate for transparency in pay practices to ensure that all employees, regardless of gender, are fairly compensated for their work. 

MORE INFORMATION ON PAY SECRECY

Need HR Assistance?

At Allan Hall HR, we have a team of experienced HR consultants. To learn more about our services, please click here. Alternatively, please feel free to call us on 1300 916 764 or contact us to discuss any questions you may have in regard to WGEA Reporting or Pay Secrecy.

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businesswoman

Considering Redundancies in your business?

Posted on | by Allan Hall

Recent research has found that almost a third of employers intended to make staff redundancies.

Australian HR Institute’s quarterly Australian Work Outlook survey indicated that redundancy intentions have risen sharply to 31% in the December 2023 quarter, up from 17% in the September 2023 quarter.

In correlation with this research, our consultants at Allan Hall HR have recently been experiencing daily calls from clients requesting support and advice on employee redundancies. 

If you are one of these employers considering redundancies in your business, we have outlined below the key components for you to consider. We also highly encourage you to seek professional guidance to help navigate a smooth and legally compliant redundancy process.

Regardless of whether your employees are award covered or not, redundancy terminations are highly complex, and the specific circumstances of each case must always be considered. There are several rules that apply and steps you should take when managing a redundancy to ensure compliance and reduce your risk of receiving a claim (such as an unfair dismissal claim). 

Redundancy Considerations

If you are planning to make an employee redundant, it is important for you to ensure that:  

  • You have taken steps to ensure you no longer require the person’s role to be performed by anyone 
  • All reasonable attempts have been made to find suitable alternative employment within the business for the employee
  • You have considered and complied with any applicable modern award obligations
  • You have undergone a consultation process which is best practice and a requirement under some awards  
  • You have prepared for, documented and communicated the redundancy process thoroughly
  • You pay the employee correctly according to their redundancy entitlements under the National Employment Standards, calculated with reference to their period of continuous service

Allan Hall HR’s Redundancy and Advice Package

At Allan Hall HR we have developed a Redundancy and Advice package which provides employers with an assortment of tools and resources to assist with undertaking a legally compliant redundancy process. The pack includes: 

  • Letter of Notice to the Employee (regarding proposed workplace changes and an invitation to a consulting meeting)
  • Guidance on Consultation Steps and Meeting Discussion Points
  • Redundancy Checklist and Consultation Record
  • Communication Strategies
  • Termination Letter due to Genuine Redundancy. 

If you wish to purchase our Redundancy and Advice Package, please click here.  We are also able to manage all or part of the redundancy process for you, according to your preference. 

Need Assistance?

Before you consider terminating an employee on the basis of redundancy, we encourage you to call us on 1300 675 393 or contact us here.  To learn more about our HR services, please click here.

Happy friends enjoying on terrace. Smiling man and women are celebrating together during sunset. They are wearing casuals in party

FBT treatment of work Christmas parties and gifts

Posted on | by Allan Hall

Fringe Benefits Tax — What business owners need to know this Christmas

As the festive season approaches, you are likely planning your end-of-year functions and perhaps even thinking about Christmas gifts for valued customers and employees for another year.

During this period, it’s important to understand and be mindful of the implications of Fringe Benefits Tax on gifts and parties, to ensure that your generosity doesn’t cause unwelcome tax consequences for your business.

To help, we have set out the following guidelines to assist you:

Fringe Benefits Tax at Christmas

Christmas Parties

If your business lodges an FBT return calculating entertainment using the 50/50 method, then 50% of the cost of your Christmas party will be subject to FBT.

If you do not lodge an FBT return using the 50/50 method then the cost of your Christmas party will be exempt from FBT provided one of the following applies:

  • The Christmas party is held on business premises on a working day for current employees only, OR
  • The Christmas party costs under $300 per head.

If your business entertains your employees frequently (more than 10 times per year) then your Christmas party may be subject to FBT regardless of the cost, so please discuss this with your Allan Hall advisor first.

Example

  1. A law firm holds its Christmas party for employees only on a Friday afternoon in the office garden complete with marquee, live band, premium alcohol and a delicious banquet cooked by a celebrity chef. The cost comes to $490 per head. This will be exempt from FBT.
  1. An electrical company holds its Christmas party at a local restaurant with food, drink and entertainment. Ten employees and their spouses are invited making a total of 20 people. The total cost comes to $5,000. As this equates to $250 per head it will be exempt from FBT.

Customer Gifts

Gifts to customers are tax deductible and not subject to Fringe Benefits Tax, provided they are a genuine gift e.g. a Christmas hamper or a bottle of wine.  If you choose to take a customer out for a Christmas drink instead, your portion of this may be subject to Fringe Benefits Tax.

Staff Gifts

Gifts are a great way to show your employees how appreciative you are of their efforts whilst still attracting a tax deduction for your business. However, it’s important to understand that staff gifts over $300 will be subject to Fringe Benefits Tax.

Further, staff gifts under $300 should be eligible for the minor benefits exemption from Fringe Benefits Tax, but if they are recreational gifts (such as concert, cinema or sports tickets) then no income tax deduction or GST can be claimed.

Understanding the intricacies of Fringe Benefits Tax and the implications of FBT on your Christmas entertaining — gifts and parties — can be challenging. Many of our team offer skilled and highly experienced advice in all aspects of Fringe Benefits Tax, so please contact your Allan Hall Advisor for specific assistance before planning your Christmas functions and/or staff and customer gifts.

NOTE: If your business is a tax-exempt body or charity then a separate set of rules applies so please consult your Allan Hall Advisor.

CONTACT ALLAN HALL BUSINESS ADVISORS

family paper chain

Parental Leave Changes — Effective 1 July 2023

Posted on | by Allan Hall

Unpaid Parental Leave

From 1 July 2023, employees will have access to changed unpaid parental leave entitlements as part of the Federal government’s recent initiatives which aim to provide families with greater flexibility.

A summary of the recent changes can be found in the table below:

Parental Leave Changes — Effective 1 July 2023 1

Impact on Employers

It is important for you to be aware of these changes to be able to adjust your policies or employee handbook and to respond to new requests and extensions to unpaid parental leave accordingly.

Please note, that if an employee wishes to extend their original unpaid parental leave, they must give at least 4 weeks’ notice in writing, before the end date of their original leave period, and the request must include the new leave end date.

As an employer, you must respond within 21 days, either agreeing; agreeing to a variation after discussion with the employee; or refusing the request. Please be mindful however, that you can only refuse a request if you have discussed a variation to the extension period with the employee but haven’t been able to reach an agreement AND if your refusal is on reasonable business grounds.

As part of the new legislation, employees have the right to lodge a dispute regarding a request for extended leave with the Fair Work Commission if:

  • the employer refuses an employee’s request;
  • the employer doesn’t provide a written response to a request within 21 days; or
  • the employee and employer have been unsuccessful in trying to resolve the dispute at the workplace level.

We therefore highly recommend that you discuss the matter with one of our consultants at Allan Hall HR before refusing any request for an extension to unpaid parental leave.

Paid Parental Leave changes

Further changes have also been made from 1 July 2023 to the Government’s Paid Parental Leave (PPL) scheme, which provides eligible individuals with financial support for the birth or adoption of a child.

Under the previous PPL scheme, parents would need to apply separately (i.e. the primary caregiver could access up 18 weeks of financial support, and the partner or ‘secondary carer’ could access up to 2 weeks of support under what was referred to as ‘Dad and Partner Pay.’)

From 1 July, parents will be able to apply to this scheme together and may access up to 20 weeks of paid parental leave to use between them. The Government has indicated that the payment will continue to increase by 2 weeks each year until 1 July 2026 when it will reach 26 weeks.

Please note, it is up to the individual to apply for a PPL payment directly through Services Australia. You will not be able to apply for this benefit on the employee’s behalf.  When an employee applies, their eligibility is determined by Services Australia. Eligibility is not determined by the employer.

Allan Hall HR has a team of experienced consultants to help answer any questions you may have regarding the Unpaid and Paid Parental Leave changes and how they should be applied to your unique business and employee circumstances.

We encourage you to reach out to us for further guidance by calling 1300 675 393 or emailing [email protected].

CONTACT ALLAN HALL HUMAN RESOURCES

July

1 July Changes

Posted on | by Allan Hall

What you need to know

There are legal, financial, and other changes your business will have to be across very soon. Not sure what they are or what to do? Don’t worry, we have you covered.

It’s been a big year for changes in areas like people management, pay and tax. Here’s a rundown of some key changes that will come into effect 1 July and what they mean for your business and your employees.

1. SUPER GUARANTEE INCREASES

If you haven’t already, then it’s time to get your payroll systems sorted as the superannuation guarantee increases to 11% from 1 July.

Also, make sure you’re across the gradual increases, which will see the super guarantee reach 12% by July 2025.

To work out how this will impact employees’ pay, have a look at whether their contract states their salary is inclusive of superannuation or not.

2. WAGES GO UP

Employees should also be aware that from 1 July, wage increases will come into effect following a ruling from the Fair Work Commission.

For employees who aren’t covered by an award, the minimum wage will go up from 1 July to $882.80 per week, or $23.23 per hour, and will apply from the first full pay period starting on or after 1 July 2023.

For employees covered by an award, minimum award wages will increase by 5.75%, also applying to the first full pay period starting on or after 1 July 2023.

3. FAIR WORK COMMISSION CHANGES

From 1 July 2023, the application fee will increase to $83.30. The fee applies to dismissal, general protections, bullying, and sexual harassment at work applications made under sections 365, 372, 394, 773, and 789FC of the Fair Work Act 2009.

There is no fee to make an application to deal with a sexual harassment dispute under section 527F of the Fair Work Act.

Also effective from 1 July, the high-income threshold in unfair dismissal cases will increase to $167,500 and the compensation limit will be $83,750 for dismissals occurring on or after 1 July 2023.

4. PAID PARENTAL LEAVE CHANGES

From 1 July, amendments to the Paid Parental Leave Scheme will come into effect.

Notably, the Dad and Partner Pay (DAPP) scheme, which currently provides up to two weeks of paid leave, will now be combined with the 18-week paid parental leave scheme. This means eligible parent couples or single parents can share their 20 weeks of leave – aimed at greater gender equity in parental caring responsibilities.

There are other changes, too, such as the whole 20 weeks of leave of instalments can be received flexibly in multiple blocks within 24 months of the child’s birth or adoption date, removing the previous requirement of 12 weeks in one continuous period.

Also, note that employees now have greater rights to request an additional 12 months of leave (24 in total) – and employers need to show reasonable business grounds on which to refuse.

5. CHILDCARE SUBSIDIES

For those who employ parents with young children, it’s worth noting that childcare rebates will change from 1 July. They should result in any employees with a family income of less than $530,000 getting a higher level of subsidy for the cost of childcare.

For example, families earning up to $80,000 will get an increased maximum Child Care Subsidy (CCS) amount, from 85% to 90%. If they earn over $80,000, they may get a subsidy starting from 90%, but it will go down by 1% for each $5,000 of income the family earns.

While these changes are applied automatically, it is worth being aware that they are coming.

6. DOMESTIC VIOLENCE LEAVE INTRODUCED

From 1 February, employers with 15 or more employees were required to provide their employees with 10 days of paid family and domestic violence leave (FDVL) per year. 

For smaller employers who employ less than 15 employees, this entitlement will operate from 1 August 2023.

Paid family and domestic violence leave is quite a sensitive topic, and there need to be procedures in place – on everything from how the HR or manager handles requests to the privacy issues around how it gets recorded on a pay slip.

7. PENSION AGE AND ELIGIBILITY INCREASES

For those businesses employing older Australians, it’s worth noting that from 1 July, the pension age will be raised to 67 for those born on or after 1 January 1957.

Not only that but asset and income eligibility tests will also be revamped, which means singles can earn $204 a fortnight and couples $360 a fortnight, before losing their full pension.

8. ENERGY BILL RELIEF ON ITS WAY

With soaring power bills contributing significantly to business operating costs, $650 in bill relief is on its way from July.

The total amount of bill relief will vary by state. To be eligible, your business must be on a separately metered business tariff with your electricity retailer – so if you run a business from home, you probably won’t qualify.

CONTACT ALLAN HALL BUSINESS ADVISORS

ute

Does FBT apply to dual cab utes?

Posted on | by Allan Hall

FBT on cars, other vehicles, parking and tolls

How FBT applies to cars, other motor vehicles, electric cars, car leasing, car parking and road tolls.

It’s a common myth that fringe benefits tax (FBT) doesn’t apply to dual cabs. However, this isn’t correct.

Here’s what you need to know about FBT

Cars and FBT
Read how FBT applies to cars, private versus business use, car leasing, and calculating the value of a car fringe benefit.

Exempt use of eligible vehicles
Your employee’s limited private use of a ute, van or other eligible vehicle may be exempt from FBT. Read more »

Electric cars exemption
From 1 July 2022 employers do not pay FBT on eligible electric cars and associated car expenses. Read more »

Car parking and FBT
Read how FBT applies to car parking, exemptions for small businesses and disabilities and how to calculate taxable value.

Road and bridge tolls and FBT
Find out when FBT applies to road and bridge tolls, and work out the taxable value of tolls.

While there’s an exemption for eligible commercial vehicles, this applies only if private use is limited. If you are taking the work ute to the footy every weekend, you may need to re-evaluate your FBT obligations.

CONTACT ALLAN HALL BUSINESS ADVISORS

Minimum-Wage-Image

National Minimum Wage rise effective 1 July 2023

Posted on | by Allan Hall

The Fair Work Commission has announced this year’s Annual Wage Review Decision

National Minimum Wage Increase 

Effective from 1 July 2023, the National Minimum Wage will increase by 5.75%.

In addition to the percentage increase, the Commission has also increased the wage level that the minimum wage had traditionally been based on under certain Modern Awards.

Together these two changes mean that those employees in receipt of the minimum wage will receive the following rates before tax:

  • $23.23 per hour, and
  • $882.80 per week (based on a 38-hour week for a full-time employee).

This increase will see an extra $70.20 ‘in the pocket’ each week.

Modern Award Rate Increase 

Similar to the National Minimum Wage increase, all 121 Modern Awards will also increase by 5.75% on 1 July 2023. 

The Fair Work Commission will release updated Pay Guides in line with the effective date.

Modern Awards can be complex. If you need help determining if a Modern Award applies to your employees or you understand what Awards apply but you need assistance understanding the specific Classification they fall under, contact the Allan Hall Human Resources Team on 1300 675 393.

Non-Award Employees 

It is important to note that if you have non-award covered employees receiving payment which is above the national minimum wage, you are not obliged to increase their salary/wages. However, with the current Australian job market being so competitive and a shortage of potential employees available, it may be worth undertaking a salary benchmarking exercise and considering if an increase would be suitable during your next salary review.    

At Allan Hall HR we can provide you with Salary Benchmarking reports, based on data from a range of current and reputable reporting sources. If you want to know what the market is doing, contact us to gain access to salary insights based on a range of factors such as industry, turnover, headcount and location!

Changes to Superannuation from 1 July 2023

As a reminder, the Super Guarantee rate will rise from 1 July 2023. This will rise by another half per cent, taking the minimum super guarantee from 10.5% to 11%.

The Super Guarantee rate will continue to rise by an additional 0.5% at the start of each financial year until it reaches 12% in 2025.

Next Steps

  1. Check if your employees are covered by the national minimum wage or a Modern Award.   
  2. Should a Modern Award apply to your employees, ensure you have correctly classified your employees under the relevant award, and confirm the minimum rates of pay that will apply.    
  3. Review the current rates of pay for your employees and, if required, adjust their pay rates from their first full pay period starting on or after 1 July 2023.
  4. Ensure you start applying the new Superannuation Guarantee rate of 11% from 1 July 2023.

Our experienced HR Consultants at Allan Hall HR are available to answer your queries regarding the wage rise and assist you with clarification of awards, salary benchmarking or any other employee-related matters. Feel free to get in touch with us today on 1300 675 393.

CONTACT ALLAN HALL HUMAN RESOURCES

closed store

Annual Shutdown and Unpaid Leave changes

Posted on | by Allan Hall

Understanding the revised regulations for Annual Leave and Unpaid Leave during temporary business shutdowns

Impact on employers and employees

Generally, when businesses temporarily shut down over Christmas/New Year, employers have been able to direct their employees to take annual leave or, where they have no annual leave entitlements available, employers have been able to direct their employees to take unpaid leave. 

As a result of changes to 78 Awards, from 1 May 2023, employers will no longer be permitted to direct their employees to take unpaid leave where they do not have a sufficient accrual of annual leave to cover the shutdown. 

The recent findings of the Fair Work Commission were, that making a direction to an employee to take unpaid leave was effectively a stand down, and the Fair Work Act 2009 only permitted employees to be stood down in limited circumstances, which did not include a temporary stoppage of operations such as an annual shutdown.   

Award Covered Employees 

Under the changes to the Awards listed in the Commission’s decision here, employers can still issue a direction to employees to take annual leave during a temporary shutdown if the direction is in writing, is reasonable and their employees have accrued sufficient annual leave entitlement. 

In assessing reasonableness, the following factors are relevant:   

  • the needs of the employee and the business   
  • any agreed arrangement with the employee   
  • custom and practice of the business   
  • timing of the direction or requirement to take leave   
  • whether the length of the period of notice given is reasonable. 

Each Award stipulates the period of notice which must be given to all employees of the shutdown (generally between 28 days and two months) unless a shorter period is agreed with the majority of employees, or for employees who are engaged after notice is given, as soon as reasonably practicable after they have been engaged. 

Employers are no longer permitted to direct employees to take unpaid leave where their annual leave entitlements have been exhausted. 

However, under the changes, employers can still: 

  • agree with an employee in writing that they take a period of unpaid leave; or 
  • come to an arrangement with the employee to take annual leave in advance resulting in a negative annual leave balance. 

But, if employees do not agree to the above, then they will be entitled to be paid wages during the shutdown period.  

Award and Agreement Free Employees 

For award and agreement-free employees, employers can still require them to take a period of annual leave if the requirement is reasonable. 

A requirement to take annual leave may be reasonable if, for example: 

  1. the employee has an excessive annual leave balance
  2. the business is being temporarily shut down for a period (such as between Christmas and New Year). 

Just like Award Covered Employees, Award/Agreement Free employees cannot be directed to take unpaid leave if they do not have sufficient accrued annual leave. 

Need Assistance?

If your business is planning a temporary shutdown of its operations, it is important that you are aware of your obligations under each applicable award for your employees and manage employee leave accordingly. Should you require assistance with notification requirements or reaching agreement with your employees regarding shutdown arrangements, please feel free to call us on 1300 675 393 or contact Alan Hall Human Resources here »