HR and payroll for beauty and salons in Australia
Reviewed by Mellow Editorial Team, HR & payroll content team
Running a beauty salon or spa in Australia means navigating a specific award, irregular hours, commission structures and high staff turnover — all at once. Get the foundations right and the day-to-day becomes manageable.
The award that governs your team
Most salon employees are covered by the Hair and Beauty Industry Award 2010 (MA000005). It sets minimum pay rates by classification — apprentice, junior, Certificate III-qualified stylist, senior therapist and so on — along with penalty rates, overtime and allowances.
Key points to know:
- Casual loading applies on top of the base rate for casual employees, which is the norm in many salons.
- Saturday and Sunday penalty rates are higher than weekday rates. If your salon trades seven days, you need to account for this in every roster.
- Allowances cover things like using own equipment or handling certain chemicals. Check the current award schedules on the Fair Work website for the exact figures.
- Junior rates apply to employees under 21, calculated as a percentage of the adult rate based on age.
If you employ massage therapists or beauty therapists in a different business context — for example, a clinic attached to a medical practice — double-check which award applies. Misclassifying workers under the wrong award is a common and costly mistake.
Superannuation and PAYG for salon staff
From 2025/26 onwards, the Superannuation Guarantee sits at 12% of ordinary time earnings, paid to a complying fund. For salon owners, "ordinary time earnings" generally means base wages, not overtime. Commission payments can complicate this — seek advice on whether commissions in your specific arrangement are included.
Super must be paid at least quarterly, and from 1 July 2026 (if legislation passes as expected) it may need to align more closely with pay cycles. Keep an eye on ATO guidance here.
PAYG withholding is based on each employee's Tax File Number declaration and any HECS/HELP debt they have disclosed. HECS/HELP repayments are deducted through payroll on a banded scale once earnings pass the annual threshold — your payroll software should handle this automatically using the ATO's tax tables. The Medicare levy of 2% is included in the withholding calculations.
Every pay run must be reported to the ATO via Single Touch Payroll (STP) at the time of payment. At the end of the financial year, you finalise STP by 14 July so employees can lodge their tax returns.
Commission, tips and mixed pay arrangements
Many salons pay a base wage plus a retail commission or service commission. A few things to keep in mind:
- The base rate can never fall below the award minimum, regardless of what an employee earns in commissions.
- Tips are generally treated as income for the employee and should be handled transparently — document your tipping policy in writing.
- If you use a percentage-of-takings model, run a regular reconciliation to confirm no one has been accidentally paid below the award floor. Fair Work can audit this and back-pay liabilities can accumulate quickly.
Rostering, leave and casual versus permanent decisions
Salons often default to a casual workforce because of unpredictable trade. That is legitimate, but it carries obligations: casuals who work a regular pattern for 12 months now have a right to request conversion to permanent employment. You need to respond to that request in writing within 21 days.
Under the National Employment Standards, permanent employees accrue four weeks of annual leave per year. Part-timers accrue leave on a pro-rata basis. Factor leave loading (17.5% under most awards) into your payroll calculations — it is easy to overlook and awkward to catch up on later.
Rostering in a salon is also where overtime exposure tends to hide. If a stylist's shift runs long because an appointment went over, that extra time counts. Build buffer time into your schedule and have a clear process for recording actual hours worked, not just scheduled hours.
Record-keeping and what Fair Work expects
Under the Fair Work Act, you must keep accurate payroll and time records for seven years. For salons, this means:
- Time-in and time-out records for each employee on each day
- Pay rates, gross pay, deductions and super contributions
- Leave accruals and balances
- Any commission calculations
Paper timesheets are legally valid but create administrative burden and dispute risk. Most salon payroll platforms let staff clock in via a tablet or phone, which feeds directly into payroll and produces an audit trail. This matters more than people realise — if a former employee lodges a wage claim, clear records are your first line of defence.
Inspectors from the Fair Work Ombudsman do conduct audits in the hair and beauty sector. The sector regularly appears in underpayment enforcement actions, largely because award complexity catches owners off guard rather than through any deliberate intent.
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