Is Your Employer Paying Your Leave Loading? A Quick Checklist for Australian Workers
Millions of Australian workers are entitled to 17.5% leave loading every time they take annual leave — and many never receive it. Here’s how to check your payslip, verify your award coverage, and calculate exactly what you’re owed.
Leave loading is one of the most commonly underpaid entitlements in Australia. Unlike base wages — which are easy to check against a pay rate — loading is a separate calculation that many payroll systems get wrong, and many employees never think to verify. The good news: checking it takes about two minutes, and if you’ve been underpaid, you can claim back up to six years of missed payments.
What this checklist covers
- Step 1: Check if your award includes leave loading
- Step 2: Find the loading on your payslip (or confirm it’s missing)
- Step 3: Calculate what you should have received
- Step 4: Compare to what you actually got
- Step 5: If there’s a gap — what to do next
Before running through the checklist, it helps to understand what leave loading actually is and why it exists. If you want the full background, read Annual Leave Loading Explained: Who Gets 17.5%, Who Doesn’t, and Why. The short version: leave loading is an additional 17.5% paid on top of your ordinary rate when you take annual leave, set by your modern award, and it is not included in the base NES entitlement.
Step 1 — Check your award coverage
Leave loading only applies if your modern award or enterprise agreement includes it. Select your industry below to see whether loading typically applies:
Award coverage quick check
InteractiveSelect your industry to see whether leave loading typically applies under your modern award.
Step 2 — Find leave loading on your payslip
Pull up your most recent payslip from a period when you took annual leave. You’re looking for one of these patterns:
| What you see | What it means | Status |
|---|---|---|
| Separate “Leave Loading” or “AL Loading” line item | Loading is being paid separately and transparently | ✓ Correct |
| Single “Annual Leave” line at a rate higher than your ordinary rate | Loading may be bundled into the leave rate — divide total by hours to check | ✓ Likely correct — verify the rate |
| Single “Annual Leave” line at exactly your ordinary rate | Loading is not being paid — if your award includes it, this is an underpayment | ✗ Likely underpaid |
| No leave pay lines at all during a leave period | Leave may have been processed incorrectly or on a different payslip | ✗ Check prior payslip |
Step 3 — Calculate what you should have received
Use this tool to calculate what your leave pay should have been — and compare it against your payslip.
Payslip verification tool
Enter what you should have earned and what your payslip actually shows — we’ll tell you if there’s a gap.
Step 4 — The full checklist
Look up your award on the Fair Work Ombudsman website. Search for “annual leave loading” in the annual leave clause. If it says 17.5%, you’re entitled. If you’re on an enterprise agreement, check the annual leave section of that agreement instead.
Pull up a pay period where you actually took annual leave. Not just any payslip — it must be one covering days when leave was taken and paid.
Multiply your ordinary hourly rate by 1.175. This is what you should be paid per hour of leave. Expected rate = $30.00 × 1.175 = $35.25/hr
Take the total leave payment from your payslip and divide by the hours of leave taken. Compare this to your expected loaded rate from step 3. Actual rate = $1,140 ÷ 38 hrs = $30.00/hr → loading missing
If your actual rate is less than your loaded rate, multiply the difference by total hours of leave taken across all periods. This is your estimated underpayment. Gap = ($35.25 − $30.00) × hours taken across all periods
Send a written request specifying: the award clause that entitles you to loading, the periods affected, and the amount owed. Keep a copy. Give your employer a reasonable opportunity to correct it before escalating.
What if your employer disputes the entitlement?
If your employer claims your salary absorbs the loading, ask them to show you the specific calculation proving your total remuneration exceeds the award rate including loading. A vague “your salary includes all entitlements” clause is generally insufficient — the Fair Work Commission has found this repeatedly.
Why do so many employers miss leave loading?
The most common cause is a payroll system misconfiguration — particularly when businesses set up leave pay types in software like Xero, MYOB, or KeyPay without enabling the loading component. The system correctly tracks leave hours but pays them at the ordinary rate, with no flag to alert payroll staff that loading is missing.
The second most common cause is the “salary absorbs everything” assumption. Many employers believe — incorrectly — that paying a salary above the award minimum automatically satisfies all loading obligations. Without a clear contractual clause and a verifiable calculation, this assumption doesn’t hold up.
Neither scenario is usually intentional. Most underpayments are payroll errors that employers correct once they’re identified. The Fair Work Ombudsman’s approach to genuine administrative errors is generally remediation-first — they want the money returned to employees, not just penalties imposed. Report an underpayment to Fair Work →
Disclaimer: Leave loading entitlements depend on your specific modern award or enterprise agreement. This checklist provides general guidance only and cannot substitute for checking your actual award. For underpayment disputes, contact the Fair Work Ombudsman. WorkCalc Australia is independent and not affiliated with Fair Work or the ATO.
Frequently asked questions: checking your leave loading
Answers on payslip checks, how far back you can claim, what to do if loading is missing, and when salary absorption is valid.
How do I know if my employer is paying my leave loading correctly?
Check your payslip from a period when you took annual leave. Divide your total leave payment by hours taken. If the result equals your ordinary rate exactly, loading is missing. It should equal your ordinary rate × 1.175 if your award includes 17.5% loading.
What should leave loading look like on my payslip?
Either a separate “Leave Loading” line item showing 17.5% of your ordinary leave pay, or a single annual leave line at a rate that is 17.5% higher than your ordinary rate. If you see annual leave paid at your exact ordinary rate with no separate loading line and your award includes loading, you’re likely being underpaid.
How far back can I claim unpaid leave loading?
Generally six years under the Fair Work Act, running from the date each payment was due. If your employer has missed loading for several years, the total may be substantial. Document each period of leave taken and calculate the shortfall for each one before raising it with your employer.
What do I do if my employer hasn’t been paying leave loading?
Calculate the total owed (hours of leave taken × ordinary rate × 0.175 for each missed period), then raise it with payroll in writing with reference to your award clause. If they refuse or dispute the entitlement, lodge a free underpayment inquiry with the Fair Work Ombudsman. For larger amounts, consider a workplace relations lawyer.
Does leave loading show up differently in different payroll systems?
Yes. Xero, MYOB, and KeyPay all handle leave loading differently depending on configuration. Some show it as a separate line, others bundle it into the leave rate. The simplest check is always to divide your total leave payment by hours taken and compare to your expected loaded rate (ordinary rate × 1.175).
My contract says salary includes all entitlements — does that cover leave loading?
Only if the contract clearly identifies the loading amount absorbed and your total remuneration demonstrably exceeds the award including loading. Vague “all entitlements” clauses are generally insufficient. Ask your employer to show the specific calculation. If they can’t, the award entitlement likely still applies.