Note: From 1 July 2008, employers must use ordinary time earnings (OTE) as defined in superannuation guarantee law to calculate the minimum superannuation guarantee contributions for their eligible employees. Ordinary time earnings are generally what employees earn for their ordinary hours of work. An employee's ordinary hours of work may be stated in a statute, an industrial award or an agreement with the employer. If the ordinary hours of work are not specified or agreed, the ordinary hours of work will be the hours actually worked (not including overtime) and any hours of paid leave. As a result, some employers will have to increase the level of contributions they make for some of their employees from 1 July 2008. The minimum amount that SG contributions are calculated on for employees includes the following types of payments:. Salary and wages not including overtime (however if an employee has agreed to work a certain number of hours, those hours are the employee’s ordinary hours of work) Allowances (other than a reimbursement of expenses) Bonuses Christmas bonuses (From 1 July 2009 only) Payments in lieu of notice (From 1 July 2009 only) Commissions Over-award payments Shift loading Casual loading Workers compensation payments, including top-up payments, paid by the employer, where work is performed Pay for annual holiday leave taken Government (wage) subsidies (eg Wage Subsidy Scheme Allowance) Pay for sick leave taken Pay for long service leave taken Director’s fees Payments for performance in, or provision of services relating to entertainment, sport promotions, films, discs, tapes, TV or radio. Payments to a contractor who is taken to be an employee under the Superannuation Guarantee (Administration) Act 1992 Salary or wages paid to former employees
The following types of payments are not included in the minimum amount that SG contributions are calculated on:
Overtime Reimbursement of expenses (eg travel costs) Benefits subject to fringe benefits tax Workers compensation payments (including top-up payments) where no work is performed Top-up payments (eg when serving on jury duty or with reserve forces etc) Payments when on maternity or paternity leave Annual leave loading Accrued annual leave, long service leave and sick leave paid as a lump sum on termination Redundancy payments Other payments paid by an employer on termination of employment Dividends Partnership and trust distributions Payments for entering into a restraint of trade agreement Payments for domestic or private work (not as part of a business) 30 hours or less per week
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