Pay run

What Is a Pay Run?

A pay run refers to the complete process of calculating and processing employee wages for a specific pay period within a defined pay cycle. It involves everything from pulling timesheet data and applying pay rates to issuing payslips, calculating deductions, transferring wages, and meeting compliance obligations like Single Touch Payroll (STP) reporting and superannuation payments.

For Australian businesses, managing pay runs correctly is not just an operational task—it’s a legal requirement. Errors in a pay run can lead to underpayments, ATO penalties, or breaches of Fair Work legislation.

ATO – Single Touch Payroll Overview

Key Components of a Pay Run

A typical pay run includes:

• Timesheet collection: Importing work hours (manually or via a time-tracking system)
• Award interpretation: Applying Fair Work award rates, overtime, allowances, and penalty rates
• Gross pay calculation: Total earnings before deductions
• Deductions: PAYG withholding, superannuation, salary sacrifice, and other deductions
• Net pay calculation: What employees actually take home
• Payslip generation: Providing detailed records to employees (required by law)
• STP submission: Reporting payroll data to the ATO in real-time
• Superannuation obligations: Scheduling contributions to employees’ super funds

How Often Are Pay Runs Processed?

Pay runs are processed based on the business’s pay cycle:

• Weekly
• Fortnightly
• Monthly

Some businesses may run multiple pay runs to accommodate different teams or employment types (e.g. casual vs full-time).

Types of Pay Runs

• Scheduled Pay Runs: Regular and automated based on the pay cycle (e.g., every Friday)
• Off-Cycle Pay Runs: Used to correct underpayments, issue bonuses, or finalise termination payments
• Backpay Runs: For retroactive pay changes or award increases
• Final Pay Runs: Used when an employee exits the company and needs entitlements processed

Compliance Requirements in Australia

Under the Fair Work Act and ATO regulations, pay runs must:

• Include accurate award interpretation
• Provide payslips within 1 working day of payment
• Ensure wages are paid on time
• Include valid STP reporting each cycle
• Include correct superannuation payments, currently 11.5% of ordinary time earnings (FY24–25)

How Microkeeper Simplifies Pay Runs

Microkeeper automates and streamlines the entire pay run process for Australian businesses:

• Automated award interpretation
• Timesheet-to-payroll integration
• STP compliance and instant ATO submission
• Payslip generation and employee self-service access
• Superannuation batching and one-click payment processing
• Integration with accounting platforms and general ledger exports

Common Pay Run Mistakes to Avoid

• Incorrect timesheets or missing hours
• Wrong pay rates due to outdated awards or contracts
• Missed leave loading, overtime, or allowances
• Late payslips or STP lodgement
• Unpaid super or underpaid contributions

These errors not only impact employee trust—they can result in fines, audits, and backpay obligations.

FAQs About Pay Runs

What’s the difference between a pay run and payroll?

‍"Payroll" is the broader function of managing employee compensation and compliance, while a "pay run" is a single instance of processing payroll for a pay period.

Can you edit a pay run after processing?

‍It depends on your payroll software. Microkeeper allows you to make post-processing adjustments if errors are found, while maintaining compliance with STP reporting.

Do casual and full-time employees get included in the same pay run?

‍They can be processed in the same or separate pay runs, depending on your setup and pay structure.

How long should a pay run take?

‍With automated tools like Microkeeper, most businesses can complete a pay run in under 10 minutes, regardless of employee size.

Best Practices for Efficient Pay Runs

• Use award-compliant payroll software with built-in updates
• Validate timesheets before initiating a pay run
• Set calendar reminders for due dates (especially for STP and super)
• Automate as much as possible to reduce human error
• Train payroll staff on common issues and Fair Work rules

Final Thoughts

A well-managed pay run is vital to maintaining workforce trust, avoiding compliance risks, and reducing payroll admin. Automating the process with modern software ensures accuracy, speed, and peace of mind.

With Microkeeper, Australian businesses can process accurate pay runs with confidence—on time, every time.

_{Disclaimer: This glossary entry is for general informational purposes only and does not constitute legal or financial advice. For specific payroll compliance queries, consult the ATO, Fair Work Ombudsman, or a qualified advisor.}