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ARTICLE · 07 DECEMBER 2025

Employee Records And Award Set-off Clauses

Gilchrist Connell
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Employers to retain sufficient employee records to verify that employees' salaries are high enough to discharge all relevant award entitlements.

AustraliaEmployment and HR
Mark Curran
Mark Curran
Natasha Whitehead
Natasha Whitehead
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A recent decision of the Federal Court involving Woolworths and Coles1 emphasises the need for employers to retain sufficient employee records to verify that employees' salaries are high enough to discharge all relevant award entitlements.

What is an Award Set-Off Clause?

An award set-off clause facilitates the payment of a salary in discharge of award entitlements. The salary must be greater than the underlying award entitlements each pay period, following the Woolworths and Coles decision.

A well-drafted award set-off clause can provide that the payment of a contractual obligation in a pay period, such as a salary, can discharge payment obligations under an award in the same period. However, payments under a contract for another purpose, such as a car allowance or bonus, can only be applied for that purpose.

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