When your job ends—whether through resignation, redundancy, or dismissal—you are entitled to receive your final pay. But what exactly does that include, and how do you know if it’s correct? Understanding how to compute final pay ensures you get everything you’re owed and can move on with confidence.
What Is Final Pay?
Final pay refers to the total amount owed to an employee when their employment ends. This amount must be paid within a reasonable time frame (often within 7 days or in line with the next pay cycle) and includes:
- Unpaid wages up to your last working day
- Accrued annual leave
- Leave loading (if applicable)
- Long service leave (if eligible)
- Redundancy pay (where applicable)
- Payment in lieu of notice (if notice isn’t worked)
Step-by-Step: How to Compute Final Pay
- Calculate Unpaid Ordinary Wages
- Start with the base wages for any days worked since your last pay. This should reflect your ordinary rate, including any penalty rates, allowances or overtime worked during that period.
- Add Accrued Annual Leave
- If you have untaken annual leave, you’re entitled to be paid it out in full. This includes:
- Standard annual leave balance
- Leave loading (typically 17.5% if your award or agreement provides it)
- If you have untaken annual leave, you’re entitled to be paid it out in full. This includes:
- Include Long Service Leave (if eligible)
- In most states, employees are entitled to long service leave after 7–10 years of continuous service. This is usually paid out upon resignation, redundancy or retirement.
- Add Redundancy or Notice Pay (if applicable)
- If your job ended through redundancy, you may be entitled to redundancy pay based on your years of service. Likewise, if you were not given notice, you may be entitled to payment in lieu of notice.
- Deduct Any Approved Deductions
- Only lawful deductions can be made from your final pay, such as:
- Unreturned company property (if agreed in writing)
- Overpaid wages (with prior agreement)
- Salary sacrifice arrangements (e.g. superannuation)
- Only lawful deductions can be made from your final pay, such as:
Common Issues to Watch Out For
- Delays in final pay
- Incorrect leave calculations
- Missing overtime or penalty rates
- Unlawful deductions
If anything seems off, contact your employer in writing, keep a copy of your payslip and employment contract, and seek further advice.
What to Do If You’ve Been Underpaid
If your final pay is incorrect or missing:
- Request a detailed breakdown of your final pay from your employer
- Review your award or enterprise agreement to confirm entitlements
- Speak to your union for support and representation
- Contact the Fair Work Ombudsman to lodge a complaint if needed
How Unions Can Help with Final Pay Disputes
Unions play a vital role in helping workers:
- Understand what they should receive
- Identify underpayments or errors
- Advocate on their behalf during disputes
- Lodge claims through the Fair Work Commission
Final Pay: Know What You’re Owed and Claim It
Leaving a job can be stressful enough without having to chase the pay you’ve already earned. Knowing how to compute final pay and where to get help means you’re more likely to walk away with everything you’re entitled to.
If you’re unsure about your entitlements or need help challenging an incorrect final pay, speak to your union or contact the Fair Work Ombudsman. You worked for it—now make sure you get it.
