Search This Blog

Monday, 5 May 2014

Difference between wages and Ordinary Time Earnings (OTE)

  1. OTE is what an employee earns while working their ordinary hours as is specified in their employment agreement, or if not specified, the regular or customary hours worked by the employee.
  2. When calculating the minimum superannuation guarantee contribution an employer must use an employee's OTE. This ensures employees are treated similarly for superannuation guarantee purposes.
  3. What an employee earns in wages and salary is not necessarily the same as OTE. Wages and salary can include items outside the ordinary hours of work.
  4. Listed below are some payments that may be included as OTE and/or wages and salary:
    Payment Received
    Ordinary Time Earnings
    Wages and Salary
    Over-Time (more than stipulated hours)
    Not included
    Included
    Earned under stipulated hours
    Included
    Included
    No ordinary hours stipulated
    Included
    Included
    Reimbursement of expenses
    Not Included
    Not Included
    Christmas Bonus
    Included
    Included
    Annual Leave
    Included
    Included
  5. For example, an employee under a contract is required to work a minimum number of hours per week but is allowed to work additional shifts. As there is no distinct pattern of how many hours are worked per week and no penalty rates for over-time, all wages received will also be OTE.
  6. However, if an employee is contracted to work 38 hours but works a further 6 hours of overtime for a higher rate, the 38 hours will be considered as wages and OTE but the extra 6 hours will only be considered wages.
  7. For more information, click here.

3 comments:

  1. Hmm it looks like your website ate my first comment (it was extremely long) so I guess I'll just sum it up what I wrote and say, I'm thoroughly enjoying your blog. I as well am an aspiring blog writer but I'm still new to everything. Do you have any suggestions for first-time blog writers? I'd certainly appreciate it. buying property with smsf

    ReplyDelete