Some components of an employment termination payment (ETP) are considered ordinary time earnings (OTE) while others are not.
For example, if a payee receives a Type O ETP that includes both a payment instead of notice (PILON) and a payout of unused rostered days off (RDO) leave, PILON is considered OTE and is subject to compulsory employer superannuation, while the RDO payout is not OTE and is not superable.
What's changed
When paying an ETP to a payee at the Termination stage of a pay batch, you can now make separate ETP payments of the same type, splitting ETP amounts across different pay codes.
For example, in Figure 1, a Type O ETP has been split into two payments paid against different pay codes.
Figure 1: Payment of multiple ETPs with the same ETP code.
Benefits
Enables users to split the OTE and non-OTE components of an ETP across separate pay codes, ensuring superannuation accrues only on the superable portion.
Supports accurate reporting of year-to-date qualifying earnings (QE) in Single Touch Payroll (STP) submissions, in compliance with the Australian Taxation Office's (ATO) superannuation requirements effective from 1 July 2026. For more information about QE, see Reporting of Qualifying Earnings in Single Touch Payroll (AU Only).
Ensures the correct portion of an ETP is reported as part of the year-to-date (YTD) OTE amount in STP reporting.