How childcare payroll usually works
A well-run payroll services for childcare engagement follows a clear path so your centre can pay staff correctly and on time while meeting ATO and Fair Work requirements.
1) Discovery and award mapping — Confirm business structure, locations and software. Identify which employees fall under the Children’s Services Award [MA000120] or Educational Services (Teachers) Award [MA000077], then set correct classifications, allowances and loadings.
2) Setup or cleanup — Configure pay items, leave rules, overtime and allowances (e.g. first aid, higher duties, meal, laundry). Align STP Phase 2 categories and testing. Migrate or tidy employee records and timesheets.
3) Timesheets and rosters — Integrate your roster/timesheet tools (e.g. Deputy, Tanda) or in‑app timesheets. Apply rules for split shifts, opening/closing spans, programming time and breaks. Implement approvals.
4) Pay runs, STP and super — Run payroll on schedule, lodge STP every pay, reconcile super at 12% (from 1 July 2025) and pay on time. Process corrections with Update or Full File Replacement events when needed.
5) Reporting and review — Track wage-to-fee ratios, leave liabilities, overtime, casual vs part-time mix, and variance to roster. Review award changes and rate updates regularly.
Australian rules to keep in view
- STP Phase 2: Mandatory. Map earnings, allowances, paid leave, overtime and salary sacrifice to the correct STP categories and test before first lodgement.
- Superannuation: Super Guarantee is 12% from 1 July 2025. Pay by due dates (or each pay cycle). Payday super is expected to commence from 1 July 2026.
- Awards and loadings: Confirm minimum engagement for casuals, higher duties, first aid, and programming time. Update pay rates when the Fair Work Annual Wage Review takes effect.
- Leave and entitlements: Ensure accurate accruals for part‑time staff with variable hours; recalculate when contracted hours change.
- State payroll tax: If your group wages approach your state/territory threshold, monitor and register as required.
- Records: Keep signed contracts, right-to-work checks, timesheets, classification notes and pay change approvals.
What to compare before you commit
Scope
Confirm award mapping, onboarding, timesheets, pay runs, STP, super processing, EOFY finalisation, and error correction are included. Ask how backpay and rate changes are handled.
Software fit
Check experience with Xero, MYOB or Employment Hero/KeyPay plus your rostering tool (e.g. Deputy, Tanda). Ensure they can explain the workflow, not just list software names.
Turnaround and communication
Clarify cut‑off times for timesheets, who approves changes, and escalation during public holidays or school holiday peaks.
Commercial fit
Compare fixed vs variable pricing, pay run frequency, reporting depth and whether you want payroll‑only or a combined service with bookkeeping, BAS and tax.
Common childcare payroll mistakes to avoid
- Using a generic pay item for multiple allowances, which breaks STP Phase 2 categorisation and EOFY reporting.
- Leaving part‑timer contracted hours outdated, causing incorrect leave accruals.
- Not applying minimum engagement for casual shifts or correctly handling split shifts.
- Missing rate increases after the Annual Wage Review and not applying backpay when required.
- Paying super late, creating lost deductions and potential SG charge exposure.
Best next steps
Write down the immediate outcome you need: correct awards, faster pay runs, cleaner timesheets, on‑time super, or end‑of‑year finalisation. Shortlist providers against that outcome, not just the title on their website.
If you also need day‑to‑day finance support, consider combining payroll with bookkeeping for childcare, periodic BAS lodgements, and year‑end tax for childcare so data flows smoothly.
Use the links on this page to compare options, then make contact with your specifics and timing so we can recommend the right fit.
Frequently asked questions
Which awards usually cover childcare employees?
Most childcare workers are covered by the Children’s Services Award [MA000120]. Early childhood teachers are typically covered by the Educational Services (Teachers) Award [MA000077]. Your payroll should record award, level and effective date for each employee.
What makes childcare payroll different?
Centres often handle split shifts, opening/closing spans, programming time, higher duties and first aid allowances, plus a mix of casual and part‑time staff. That puts more weight on accurate timesheets, award mapping and STP Phase 2 configuration.
How often should super be paid?
The Super Guarantee is 12% from 1 July 2025. Many pay quarterly by the due dates, but paying per pay cycle reduces risk. Payday super is expected from 1 July 2026, so updating workflows now is sensible.
What should I check before choosing a provider?
Ask for proof of award knowledge, sample reports, error correction process, STP Phase 2 mapping, timesheet integrations and handover steps. Confirm how they coordinate with bookkeeping, BAS and tax work.