Is your company making these payroll mistakes? 6 common problems and how to fix them

We all know how far away payday can feel. The only thing worse than the wait? An incorrect paycheck.

Unfortunately, payroll mistakes remain surprisingly common in 2025, and their impact is growing more serious. From hefty fines to reputational damage and employee dissatisfaction, even small errors can have lasting consequences.

Recent research highlights the scale of the problem: In 2024, the Australian Council of Trade Unions estimated wage theft and underpayment to total more than $1.6 billion annually. At the same time, the Fair Work Ombudsman (FWO) has intensified enforcement, with record penalties issued to businesses that failed to comply.

While Australia still has one of the most complex workplace relations systems in the world, most payroll issues stem from human error, outdated systems, or poor processes. A misclassified worker, a miscalculated timesheet, or an overlooked superannuation contribution can all create serious compliance risks.

Here are six of the most common payroll mistakes — and how to avoid them.

Mistake #1: Misclassifying workers

Australia’s Modern Awards remain complicated, and the complexity only grows as industries evolve. For example, the Hospitality Industry (General) Award continues to include dozens of classifications, each with unique pay and conditions.

To avoid misclassification:

• Ensure HR and payroll teams work together when onboarding and updating employee records.

• Invest in automated compliance tools that can flag potential errors before they occur.

Humanforce’s Award Interpretation and Compliance Management tools provide automated alerts that reduce the risk of costly classification mistakes, ensuring employees are placed under the right award conditions.

Mistake #2: Calculating superannuation incorrectly

Superannuation contributions are one of the most common compliance pitfalls. As of 1 July 2024, the Superannuation Guarantee (SG) rate increased to 11.5%, and it will rise again to 12% in July 2025.

Common mistakes include:

• Misunderstanding what counts as Ordinary Time Earnings (OTE).

• Forgetting to include bonuses, allowances, or certain loadings.

• Failing to update payroll systems after rate changes.

Employers should stay updated with ATO guidelines and use payroll systems that automatically adjust for SG increases and OTE inclusions.

Mistake #3: Underpaying overtime

Overtime compliance remains one of the most error-prone areas of payroll. Rates vary widely based on award type, day, time, and hours worked. Additionally, some awards mandate minimum rest breaks between shifts — if these are not met, entire shifts may need to be paid at overtime rates.

Humanforce’s workforce management platform helps:

• Track overtime obligations in real time.

• Apply the correct multipliers automatically.

• Flag compliance risks like excessive overtime or insufficient breaks.

This ensures employers can stay compliant while also protecting staff wellbeing.

Mistake #4: Relying on pen-and-paper timesheets

Manual timesheets — whether on paper or spreadsheets — are not only inefficient, they’re also a compliance risk. Errors in handwriting, data entry, or version control can quickly lead to payroll mistakes.

In 2025, regulators and employees alike expect digital accuracy and transparency. Manual processes are increasingly seen as outdated and non-compliant.

Humanforce’s Time & Attendance tools allow employees to clock in and out via mobile devices, ensuring records are both accurate and secure. With payroll integration, approved hours feed directly into payroll — removing manual entry errors.

Mistake #5: Processing payroll late

Late payroll isn’t just frustrating — it can now result in fines for breaching Fair Work obligations around payslips and record keeping. In its 2024 audits, the FWO reported that a significant proportion of breaches involved delayed or incorrect payslips, even where wages were paid correctly.

Delays are often caused not by payroll itself, but by poor-quality or late data inputs (e.g., rosters, timesheets, leave records).

Humanforce integrates seamlessly with 100+ payroll providers, ensuring data accuracy and compliance while reducing processing delays. This helps employers pay their teams correctly and on time, every time.

Mistake #6: Using inadequate payroll technology

Outdated or manual payroll systems create unnecessary risk in 2025. From incorrect tax calculations to poor record keeping, relying on inadequate payroll technology can lead to non-compliance, inefficiency, and employee dissatisfaction.

The smarter solution is Humanforce Payroll:

• Built to handle Australia’s complex awards and compliance requirements.

• Seamlessly integrated with Humanforce workforce management tools.

• Automated calculations for wages, overtime, superannuation, and tax.

• Real-time visibility for HR, payroll, and finance teams.

By consolidating workforce management and payroll in one modern platform, businesses reduce the risk of human error, improve compliance, and free up staff to focus on more strategic priorities.

Protect against payroll mistakes and headaches

Payroll mistakes are common, but they don’t have to be inevitable. By combining up-to-date compliance knowledge with modern, integrated payroll technology, your business can protect against fines, improve employee trust, and reduce administrative burden.

If you’d like to see how Humanforce can help streamline your payroll and compliance processes, get in touch for a free demo tailored to your business needs.

About Humanforce 

Humanforce is the all-in-one platform for frontline and flexible workforces, offering a truly employee centred, intelligent and compliant human capital management (HCM) suite – without compromise. Founded in 2002, Humanforce has a 2300+ customer base and over half a million users worldwide. Today, we have offices across Australia, New Zealand, the US, and the UK. 

Our vision is to make work easier and life better by focusing on the needs and fulfilment of frontline workers, and the efficiency and optimisation of businesses. 

To learn more about how Humanforce’s solution can help automate people processes in your business, please contact us.