Bookkeeping & Payroll for Retail Shops

Most retail employees are covered by the General Retail Industry Award 2020, which sets minimum rates by classification level. Those minimums are reviewed by the Fair Work Commission every year and rise from the first full pay period on or after 1 July — the 2026 review lifted modern award minimum wages by 4.75%. On top of the base rate, weekend work usually attracts penalty loadings (commonly 25% on Saturday and 50% on Sunday) and public holidays can reach 150%, depending on classification and employment type. Because the exact dollar figure changes each July, confirm the current rate for the relevant classification on the Fair Work Pay Calculator before you set pay or configure your POS and payroll.

Identify which days they worked and apply the applicable rate: ordinary rate for weekdays (Monday–Friday), 25% loading for Saturday, 50% for Sunday, and public holiday rates as per the Award. For example, using an illustrative ordinary rate of $25/hour, a part-time assistant who works Wednesday 6 hours, Saturday 4 hours and Sunday 3 hours would be paid: (6 × $25) + (4 × $25 × 1.25) + (3 × $25 × 1.50). Use the employee's actual current classification rate from the Fair Work Pay Calculator, and track hours worked daily with a time-and-attendance system to ensure accuracy.

Yes. When retail staff take annual leave, they're entitled to their ordinary rate plus 17.5% annual leave loading (unless a higher loading is agreed). The loading applies to all leave taken during the year. Some awards or agreements allow 'cashing out' of loading (paying it at separation rather than during leave), but this is less common in retail. Always include the 17.5% loading in leave pay. If an employee leaves, calculate final leave pay as: (accrued leave days × ordinary hourly rate × 1.175).

Minor discrepancies (under 0.5%) are normal due to rounding and human error. Investigate larger discrepancies by: (1) reviewing the till records for voids or refunds, (2) checking if all staff logged in/out correctly, (3) reviewing security footage if needed, and (4) identifying patterns in which shifts or staff are responsible. Once investigated, record the discrepancy in your cash reconciliation sheet. Fair Work and ATO expect reasonable reconciliation processes. Don't dock employee pay for shortages without a thorough investigation and documented evidence of responsibility.

A casual employee has no guaranteed hours and is hired on a shift-by-shift basis. They're paid a higher hourly rate (typically 20%+ above the part-time rate) but receive no paid leave. A part-time employee has a guaranteed minimum number of hours per week and is entitled to paid annual leave and long service leave (after meeting eligibility). When engaging retail staff, clearly document whether they're casual or part-time, as misclassification can lead to back-pay claims. Casual loading is currently an additional 20% (as of September 2024) and is indexed annually.

Casual workers are not entitled to paid annual leave under the National Retail Award; instead, they receive casual loading (20% additional pay on top of their hourly rate). However, if a casual employee is rehired within a certain period, they may be reclassified as part-time, at which point they start accruing leave. If a casual becomes part-time, accrue leave from the date of reclassification forward. Some state or enterprise agreements may provide additional leave provisions—check your specific agreement.

Keep records of: employee name, address, and dates of employment; hours worked each day; rates of pay (including penalty rates applied); amounts paid; leave accrued and taken; annual leave loading applied; and any agreed variations. Records must be kept for 7 years. Use a time-and-attendance system or till records linked to payroll. Fair Work may request these to verify award compliance. Poor records result in penalties even if you believe you paid correctly.

Daily reconciliation is best practice. At close of business each day, print the till report, count physical cash, and compare. Investigate discrepancies immediately. Keep a cash reconciliation log with date, amount, discrepancy, and explanation. Weekly and monthly reconciliation against GL records helps spot patterns (e.g., a particular shift is consistently short). Some retail systems automate this. If discrepancies are significant or recurring, review till procedures, staff training, and security measures.

Misclassifying a part-time employee as casual (or vice versa) can result in: back-pay liability for unpaid leave entitlements, Fair Work enforcement action, penalties up to $15,800 per breach, and reputational damage. The Fair Work Commission uses a multi-factor test: casual workers typically have no guaranteed hours and are hired on an ad-hoc basis, while part-time workers have regular weekly hours. If an employee claims misclassification, the burden of proof is on the employer to show they were genuinely casual. To be safe, document the employment arrangement clearly from day one.

Most modern POS systems (like Square, Shopify, MYOB, or Vend) can export daily sales and staff logs. Export this data to your payroll/accounting system to reconcile recorded sales against payroll hours. This helps verify labour cost as a % of revenue and identifies discrepancies. For example, if recorded sales are high but logged staff hours are low, investigate whether all staff clocked in. Some payroll providers integrate directly with POS systems for real-time reconciliation. Talk to your payroll provider about integration options.