The introduction of Single Touch Payroll (STP)

Phil Brunner • Jun 17, 2019
We have had a number of inquiries from our clients seeking to understand the upcoming introduction of Single Touch Payroll (STP). Although payroll is not our Bailiwick and this issue is not directly relevant to us, we are happy to give our clients some general understanding to assist them to meet their legal obligations. This article does not provide legal or accounting advice but is for the purpose of improving understanding by simplifying the information available from the ATO – https://www.ato.gov.au/Business/Single-Touch-Payroll/

STP is a new way of reporting tax and super information to the ATO. It is important to be aware that STP does not in any way change your existing practices, obligations or rates of pay.

STP will be a legal obligation on small employers from 1 July 2019. This is a perfect time to review all of your legal obligations to ensure you are complying with all employment regulations and protecting yourself against disputes or claims from your employees.

Things you need to check

  • As an Employer do you know your legal obligations for documents and records?
  • Is your casual employee really a casual employee? 

How STP works
STP works by sending tax and super information directly from your payroll or accounting software to the ATO every time you run your payroll.

When you start reporting:
  • you will run your payroll, pay your employees as normal, and give them a payslip – your pay cycle or method does not need to change.
  • your STP-enabled payroll software will send a report to the ATO which includes the information they need from you, such as salaries and wages, pay as you go (PAYG) withholding and super information.
At the end of the financial year, you’ll will need to finalise your STP data. This is a declaration to the Commissioner to state you have completed your reporting for the financial year. You will no longer have to give your employees a payment summary (group certificate) or provide the ATO with a payment summary annual report.

You can report STP through one of the following ways:
  • Report from your current payroll solution when it is STP-ready. A payroll solution is the accounting, business management or payroll software you use to run your payroll and pay your employees.
  • Report from a new payroll solution which is STP-ready.
  • Ask a third party, such as your registered tax agent, to report to STP on your behalf.
In essence, nothing will change in how you process payroll. The main thing is that after each “payroll” you will have to send some additional reporting information to the ATO. The obligation is on you as the employer to send information to the ATO.

No-cost and low-cost solutions for Single Touch Payroll
Employers with 1-4 employees (micro employers)

If you have four or less employees (micro employer) and you don’t currently use payroll software, there will be other ways to report STP information.

The ATO asked software developers to build no-cost and low-cost STP solutions for micro employers – including simple payroll software, mobile phone apps and portals.

They have published a list of the companies intending to offer these solutions. Find out more at https://www.ato.gov.au/business/single-touch-payroll/in-detail/low-cost-single-touch-payroll-solutions/

If it’s all too hard …
You will also have the option for your accountant, registered tax or BAS agent to report your STP information quarterly, rather than each time you run payroll. This option will be available until 30 June 2021.

If you would like assistance generally in employment matters, please contact us on (08) 9321 5451 or by email phil@bailiwicklegal.com.au.

For further information about our legal services, please visit our website: https://www.bailiwicklegal.com.au/

The above information is a summary and overview of the matters discussed. This publication does not constitute legal advice and you should seek legal or other professional advice before acting or relying on any of the content.
05 Mar, 2024
Find out what we have been up to and recent events in our March 2024 newsletter .
20 Feb, 2024
The Human Rights Commission may take action against employers who fail to actively eliminate sexual harassment, discrimination and victimisation in the workplace, as part of a positive duty reform. While the reform itself was introduced under the Sex Discrimination Act in 2022, a change was put in place last December - and every employer, including those in the agricultural sector, is affected. This change has provided the commission with new powers to investigate and enforce compliance with positive duty and investigate organisations or businesses where it "reasonably suspects" non-compliance. What does this mean for shearing contractors, sheep producers and other primary producers? Speaking at the WA Shearing Industry Association (WASIA) general meeting last month, Bailiwick Legal solicitor Matilda Lloyd said the enforcement power involved inquiries and investigations similar to WorkSafe. She said a complaint did not have to be made for an inspector from the commission to visit and look over a workplace, and see if there is any kind of sexual harassment occurring. "The commission looks at policies and procedures, and essentially you need to be able to demonstrate that you're compliant with this positive duty. "When you think about it in the context of a shearing shed, it is the safety checklist you have in place for when people enter the shed. "Those are the things you need to consider with sexual harassment as well." Ms Lloyd said the commissioner never had the power to conduct an investigation before and, as such, practically how it was going to work was an unknown. "We don't know whether they're going to be coming out and doing regular inspections, what those inspections are going to look like in terms of time or how thorough they are going to be, " sh e said. "They need to be thought of the same way as a WorkSafe investigation, whereby it could happen at any point whether a complaint is made or not. "Investigators will expect employers to show that they are actively trying to eliminate this form of unlawful conduct." If an inquiry occurs, what will happen? If an employer wasn't taking the correct measures to stop sexual harassment, discrimination and victimisation from occurring, they could be issued a compliance notice. Ms Lloyd said if the notice wasn't adhered to and an inspector returned, they could apply to the Federal Court to have that positive duty enforced. What is positive duty? Ms Lloyd said a positive duty was a legal obligation on an employer or person conducting a business or undertaking to take reasonable and proportionate measures to eliminate unlawful behaviours in the context of work, workplaces and working relationships. In the case of shearing contractors, sheep producers and other primary producers, she said that obligation was on the employer and applied to all staff, workers, contractors, customers and people entering, for example, a shearing shed. She said the obligation was "very broad" and applied right across the board. "Enforcing positive duty is pretty straightforward in terms of the employer, but when we look at the other parties involved it is extensive, " Ms Lloyd said. "When we are talking about sexual harassment in the workplace we are talking in the shed and in a vehicle on the way to work or another shed. "It is also offsite, so if you are having work drinks at the quarters or wherever afterwards - that's also a workplace within the definitions of the act. "The obligation applies across the board in all of these circumstances. "And also applies to visitors, so if you have farmers and they bring their wives, it is anyone coming into that shed or environment." In the context of positive duty, what do contractors need to do? Firstly, employers need to understand what sexual harassment, sex-based harassment, discrimination and victimisation is. Ms Lloyd said employers were responsible for leading their team, so it was important to understand what the laws were and how they affected not only them, but their employees. "When we talk about sexual harassment we talk about unwelcome conduct that is of a sexual nature or requests for sexual favours, touching, requesting dates and so forth," she said. "Whereas sex-based harassment is harassment that is targeted at a particular sex. "This could be making sexist comments about a woman because she's a woman or making sexist comments about a man because he's a man. "Then victimisation is about targeting someone because they've made a complaint." Ms Lloyd said a conversation then needed to be had to educate employees, whether that be face-to-face, by Whatsapp or having it displayed in the shed. She said there were resources and guidelines available through the Human Rights Commission, which helped with this. "Have that conversation - as an employer understand what sexual harassment is but then talk to your employees and be serious about educating your employees, " Ms Lloyd said. "It is about actually having that conversation and then thinking about what material can be given to them. "The whole point is to make it easy, so people understand. "Then it goes into training and support - is there someone in your team people can talk to?" The seven standards The commission has released guidelines for complying with the positive duty under the Sex Discrimination Act 1984. The guidelines are centred around seven standards - leadership, culture, knowledge, risk management, support, reporting and response, and monitoring, evaluation and transparency. Examples of practical actions that organisations or businesses can take to meet each of the standards are set out in the guidelines. Ms Lloyd said, as each business is different, it depended on how big a team was, what was going to be practical and cost-effective in the workplace. She said the commission would look at the different standards if there was an investigation or inquiry. How often do employers need to talk to their team about this? Ms Lloyd said it should be looked at similarly to safety or work related issues, whether that be a toolbox or regular meeting once a week or every couple of days. She said if a contractor was starting a new job or visiting a place they hadn't been to before, it was about having that conversation upon arrival. "When everyone's preparing for their first break, sit down and have a chat about general safety as well, " Ms Lloyd said. "That's the first step, and then follow it up a month later when you start a new shed. "It is about consistently and actively taking measures to create a safe space. "It seems obvious that once you've gone through your checklist you then talk to the people coming into that environment, who are your workers, and alert them to what you have found. "Similarly, with positive duty, a checklist is proof that you are doing the right thing if you are audited." Does insurance cover sexual discrimination cases? Having insurance does not diminish positive duty, it just safeguards employers against potential damage and loss against their business if they are sued. Ms Lloyd said sexual discrimination cases, which travelled through the Federal Court, were not cheap and often have adverse outcomes from an award of damages perspective. "If we talk about Work Health and Safety, as you know, that is a serious issue you have to take onboard and consider, " she said, "And that's the way I think employers need to frame their conduct when talking about and implementing measures to prevent sexual harassment, discrimination and victimisation." Is an employer covered if they have put everything in place, but those rules are still broken? Ms Lloyd said an employer would be protected if they have been able to eliminate as much as they can with the resources available to them. She said it was important to remember sexual harassment and discrimination is unlawful conduct. "In terms of positive duty, by taking all reasonable steps and measures given the resources available to you, you will be able to mount a solid defence against any claim. "If you've done your duty positively and it can be demonstrated that you've exercised your role in appropriate fashion, then that will be solid defence." For more information on the positive duty reform and seven standards, go to humanrights.gov.au
14 Dec, 2023
See what's been happening and current topics of interest in our December 2023 newsletter .
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