Labour hire payroll now runs on a tighter clock. Since Payday Super started on 1 July 2026, super for each pay run has to reach your workers' funds within 7 business days of payday, so every weekly pay cycle carries its own super deadline. For a labour hire business, that deadline sits at the end of a long chain: approved timesheet, award interpretation, payroll, client invoice and super, usually spread across a recruitment system, a payroll platform and Xero or MYOB. Most problems happen where one system hands over to the next. This article walks through that chain, where it usually breaks, and what labour hire licence obligations add on top. It is general information, not legal or tax advice, so check the detail with your accountant or adviser.
The labour hire pay-and-bill chain
Every cycle follows the same steps, whatever software you use:
- Timesheet. The worker's hours are recorded and approved by the host client, often in a timesheet portal or app.
- Award interpretation. The hours are turned into pay lines under the right award or enterprise agreement: ordinary time, overtime, penalties, allowances, casual loading.
- Payroll. The pay run is processed, wages are paid and the pay event is reported through Single Touch Payroll.
- Client invoice. The same approved hours are charged to the host client at the agreed charge rates, and the invoice lands in Xero or MYOB.
- Super. Super on the qualifying earnings is paid and has to reach each fund within 7 business days of payday.
When all five steps read the same approved timesheet, the numbers agree. When someone exports, adjusts and re-imports between steps, they drift.
What Payday Super changed for labour hire
Before July 2026, a late or short super payment could be found and fixed before the quarterly due date. Now each payday starts its own count. The ATO says the day you pay qualifying earnings is day 0, and the 7 business day timeframe does not change if there is an error or delay processing the contribution.
For labour hire, that matters because:
- Pay runs are frequent. Weekly pay means a super deadline every week, not four times a year.
- Workers change often. New starters bring new fund details, and a missing or wrong fund is one of the easiest ways to miss a deadline.
- Corrections are common. A late timesheet or a disputed shift becomes a back-pay line in the next run, and that pay also carries super.
The ATO's first-year approach
The ATO has said that in the first year of Payday Super (1 July 2026 to 30 June 2027) its focus is on helping employers transition, as set out in Practical Compliance Guideline PCG 2026/1. It looks at behaviour: are you trying to pay each payday, and are you fixing problems quickly? Its guidance describes low, medium and high risk zones. An employer who tries to pay on time and fixes a failed contribution as soon as practicable is treated as low risk. Unpaid super that is still not fixed within 28 days after the end of the quarter puts an employer in the high risk zone. The ATO also stresses keeping records of how qualifying earnings and contributions were calculated, including corrections. Read the ATO's own page on compliance in the first year of Payday Super for the detail.
Where the mismatches happen
Most labour hire businesses run some version of a recruitment system (JobAdder, Bullhorn or similar), a pay-and-bill or payroll platform, and Xero or MYOB for the accounts. Some platforms connect directly: for example, JobAdder's published integration with Astute creates the employee, client and job records in Astute when a placement is made. Even with a connector, these gaps are common:
- Placement details don't match pay details. A pay rate, charge rate or award classification is updated in the recruitment system but not in payroll, or the other way round.
- Late and amended timesheets. Hours approved after the pay run cut-off are paid next week but billed this week, or not billed at all.
- Award interpretation outside the system. Penalty and overtime rules are worked out in a spreadsheet, so the pay run and the invoice use different numbers.
- Invoices built separately. The client invoice is created from a different export than the pay run, so margin reports never quite match.
- Super treated as a quarterly job. Super is reconciled at the end of the quarter out of habit, which is now too late to see a failed payment.
- Fund details collected late. A new worker's fund details sit in an onboarding form and never reach payroll before the first pay run.
None of these is a software fault. They are hand-offs nobody owns.
Labour hire licence records add another layer
Licensing is state-based, and licences in one state don't cover another. The regulators publish the rules; check them directly:
- Queensland. Under the Labour Hire Licensing Act 2017, providers must be licensed and businesses that use labour hire must only use licensed providers. Licensees report every six months, and the report includes the number of workers registered and supplied, the industries, occupations and locations they were supplied to, and accommodation and other services provided. See labourhire.qld.gov.au.
- Victoria. The Labour Hire Authority says a stronger fit and proper person test and a financial viability declaration applied to licence holders and applicants from 1 June 2026. From 1 October 2026 the definition of labour hire focuses on whether an arrangement has the character of labour supply, which makes clear that a licence is needed to supply labour anywhere in a supply chain. See labourhireauthority.vic.gov.au.
- South Australia. According to the SA Government's business site, all labour hire providers now need a licence (before 29 January 2026 it covered only some industries), with a grace period for newly covered industries to be licensed by 29 July 2026. Businesses using labour hire should check their providers on the Consumer and Business Services public register.
The systems point is simple: those reports and checks draw on the same placement, worker and client data as your payroll. If that data lives in three places, each report becomes a spreadsheet exercise.
Keeping pay, bill and super matched
You don't need to replace your software to fix most of this. You need one approved timesheet that every step reads, and a check at the end of each cycle.
- One source for rates. Pay rates, charge rates and award classifications are set once, at placement, and flow to payroll and invoicing.
- Bill from the same pay data. The client invoice is built from the approved hours that were paid, so pay and bill can't drift apart.
- A weekly three-way check. Hours paid, hours billed and super paid are compared for each pay period, with differences listed by worker and client.
- Super confirmed, not assumed. Payments are checked against what funds accepted, so a rejected contribution is seen within days.
- Licence data from the same records. Worker counts, clients, locations and industries come from the placement data rather than a separate tally.
If your pay-and-bill platform already does all of this, keep it. Where it stops at the edge of the accounts, a business process automation piece can carry the data the rest of the way. For the payroll set-up itself, see our Payday Super checklist for Xero and MYOB.
Frequently asked questions
Does Payday Super apply to labour hire workers?
Yes. The labour hire provider is generally the employer, and super must reach each eligible worker's fund within 7 business days of each payday. Check your own arrangements with your accountant, especially for workers engaged as contractors.
What happens if we miss a Payday Super deadline in the first year?
The ATO's first-year approach looks at whether you are trying to pay each payday and fixing problems quickly. Fixing a failed payment as soon as practicable keeps you in its low risk zone. Unpaid super left uncorrected for longer can still lead to an ATO charge assessment (the SGC), so fix it and keep a record of what happened.
Do we need a labour hire licence in every state?
Queensland, Victoria and South Australia each run their own scheme, and a licence in one state doesn't cover another. Check each regulator's site for the states you supply workers in.
Can our recruitment system send hours straight to Xero or MYOB?
Some can send invoices or summary journals. The question is whether the invoice and the pay run use the same approved hours, rates and adjustments. If they come from different exports, they will drift.
If your timesheets, pay runs and client invoices don't line up each week, book a free initial chat. We'll look at where the hand-offs break and tell you honestly whether your current software can do the job.