Payroll complexities continue to stump organisations, report reveals

From the key findings, 64 per cent of organisations reported full confidence in their payroll compliance, while 36 per cent remained unsure they were paying employees correctly, with confidence levels shifting depending on the organisation's size and workforce complexity.

One year on from the wage theft reforms, it was also noted in 2024–25 that the Fair Work Ombudsman recovered $358 million for over 249,000 workers.  

Marcus Zeltzer, Yellow Canary founder and managing director, said recoveries of that scale highlighted how widespread payroll errors had become and reinforced the need for organisations to actively govern payroll risk before it resulted in serious consequences.  

“The most significant payroll issues are rarely intentional. Instead, they are driven by the complexity of modern award interpretation and the limitations of payroll systems, rather than a lack of care or diligence,” he said.

“Over the past year, payroll compliance has become more deeply embedded in organisational governance. It is now routinely discussed at a broad level, incorporated into budgeting and audit processes, and recognised as a core element of financial and risk assurance.”

However, despite this progress, many organisations were still working to translate the heightened awareness into consistent and reliable confidence across their people, process and platforms.

Though 89 per cent of organisations introduced new payroll compliance measures after the January 2025 wage theft reforms, they remained concerned with interpreting employment instruments and system limitations.

Low confidence in payroll accuracy also emerged in the report as the biggest risk, as organisations were uncertain around pay cascades across superannuation, leave, and payroll tax, and didn’t want to be exposed to legal, financial and reputational consequences.

 Looking ahead to 2026, one-third of organisations said they planned to strengthen all compliance areas, with payroll tax, awards and enterprise agreements and superannuation being named as key priorities.

Zeltzer said with wage left laws now in effect, organisations would continue to sharpen their focus on accuracy and accountability in payroll.

“However, persistent challenges in interpreting employment instruments and uncertainty around pay accuracy mean many organisations still need to strengthen their people, processes, and platforms to achieve clearer visibility, transparency and lasting compliance,” he said.

“The path forward requires continuous evidence, strong collaboration, and technology that makes compliance visible, repeatable, and dependable.”