Picture this: You’ve got a team of 30 workers spread across three sites. Half are on the building and construction award, the other half on a CFMEU enterprise agreement. One crew hit overtime on Saturday, another’s accruing RDOs, and your carpenter just hit CW5 classification. Oh, and Fair Work’s been ramping up construction audits.
If that scenario makes your stomach drop, you’re not alone.
Construction payroll in Australia is brutally complex. Between Modern Awards, Enterprise Bargaining Agreements, rostered days off, site allowances, and penalty rates that vary depending on who works when and where, manual calculations can be a compliance minefield.
Here’s the good news: the right construction payroll software automates all of it.
Key Takeaways
How construction payroll software handles complex award rates:
- Interpretation of Awards including MA000020 (Building and Construction General On-site Award)
- Custom EBA configuration for CFMEU, ETU, and CEPU agreements
- Automatic overtime and penalty calculations based on time, day, and worker classification
- Real-time RDO tracking and accrual management
- Construction-specific allowances applied by site location and worker role
Why Construction Payroll Is Uniquely Complex
Construction isn’t a standard Monday-to-Friday desk job. You’ve got labourers working alongside electricians, carpenters, and plumbers, each with different pay rates, classifications, and entitlements. Add multiple job sites, weather delays, and shifting crew sizes, and you’re juggling hundreds of variables every single pay run.
But here’s what makes construction payroll truly challenging: the awards and agreements themselves.
The Building and Construction General On-Site Award (MA000020)
This is the baseline Modern Award that covers most on-site construction work in Australia. Fair Work provides a building and construction award pay guide with detailed rate information for all classifications. According to Fair Work, it applies to everything from general building and construction to civil projects, such as roads, bridges, and infrastructure work.
The award sets minimum rates for different classifications — from CW1 (entry-level labourers) through to CW8 (highly skilled tradespersons). Each classification comes with its own hourly rate, and that’s before you factor in overtime, penalties, or the dozen-plus allowances that might apply.
Ordinary hours under the award are 38 per week. Overtime kicks in after that, with the first two hours paid at time and a half, then double time for everything beyond. Weekend and public holiday rates stack on top of base rates. Miss one calculation and you’re underpaying someone.
Enterprise Bargaining Agreements (EBAs) in Construction
Then you’ve got EBAs. An Enterprise Bargaining Agreement is a legally binding agreement negotiated between an employer (or group of employers) and their employees, often through a union. In construction, the CFMEU, ETU, and CEPU have negotiated some of the most comprehensive EBAs in the country.
EBAs almost always provide better conditions than the Modern Award, and they can be vastly more complex to administer. Here’s what sets them apart:
- 36-hour week instead of 38: Workers get paid for 38 hours but only work 36, with those extra two hours banking towards an RDO.
- All overtime at double time: Unlike the award’s time-and-a-half then double-time structure, many CFMEU EBAs pay double time for all overtime from the first minute.
- Higher base rates: CW7 employees under typical CFMEU agreements can earn nearly double the award minimum rate. That gap widens further when you factor in overtime and shift work.
- Mandatory RDO calendars: Rather than leaving RDOs to individual employer discretion, CFMEU agreements often include fixed RDO calendars with 26 paid days off per year (double what’s typical under the award).
- Stricter casual provisions: Minimum engagements jump from 4 hours (award) to 8 hours (many EBAs). After just 4 weeks, casuals can request permanent conversion, and if you refuse, their casual loading leaps to 75%.
These aren’t minor differences. They fundamentally change how payroll works — and if you’re manually tracking this stuff in spreadsheets, errors are inevitable.
Common Challenges of Managing Construction Award Rates Manually
Let’s get specific about where things go wrong.
Multiple Pay Rates Across Different Trades
A single job site might have labourers on CW3, carpenters on CW5, electricians on different classifications again, and a leading hand overseeing the lot. Each classification triggers a different base rate, which is then applied to various overtime rates, penalty calculations, and allowances.
Now multiply that across multiple sites. You’re not managing 30 employees, you’re managing 30 employees across potentially hundreds of different rate combinations depending on what they do, where they work, and when.
Overtime and Penalty Rate Calculations
Under the building and construction award, overtime for the first two hours is calculated at 150% of the ordinary rate. After that, it’s 200%. Saturdays have their own rates. Sundays are different again. Public holidays stack even higher.
But if someone’s on a CFMEU EBA, all overtime is paid at 200% from the first hour. No tiering. Different rules, different calculations, same Friday deadline to get it right.
Miss a penalty rate, and you’re underpaying. Apply the wrong tier of overtime, and you’ve either short-changed someone or blown your labour budget.
RDO (Rostered Day Off) Tracking and Accruals
RDO construction rules under many CFMEU EBAs mean workers accumulate 0.4 hours per day towards a rostered day off — that’s the difference between working 8 hours and being paid for 7.6. Every 10 working days, they’ve banked enough for a full day off.
But RDOs need to align with published calendars, and you can’t let more than five RDOs bank up at once. That means constant tracking, scheduling around fixed RDO Mondays, and ensuring accruals don’t exceed budget.
For businesses operating under the standard award, RDOs work differently again — typically one day every 20 working days. Same name, completely different calculation.
Construction-Specific Allowances
Then there are the allowances. Site allowances vary by project height and location. Multi-storey buildings trigger additional payments as the number of floors increases. Confined space work, height work, first aid responsibilities, tool allowances, and leading hand allowances — all calculated differently depending on the award or EBA in play.
Travel allowances depend on the distance from the GPO to the site. Inclement weather provisions kick in when it’s too hot, too wet, or too windy to work safely. Every allowance has its own rules, triggers, and compliance requirements.
Casual Conversion and Minimum Engagement Rules
Casuals under the award have a 4-hour minimum engagement. CFMEU EBAs often mandate 8 hours. That means if you call someone in for three hours of work on a CFMEU site, you’re paying them for eight.
After 4 weeks of regular, systematic work, casuals can request conversion to permanent employment under many EBAs. Refuse that request, and the casual loading jumps to 175% of the ordinary hourly rate — that’s a 75% casual loading instead of the standard 25%.
Get this wrong once, and you’re facing a Fair Work complaint. Get it wrong systematically, and you’re looking at serious penalties.
How Construction Payroll Software Automates Award Interpretation
This is where good payroll compliance software changes everything.
Pre-Built Modern Award Templates
The software comes pre-loaded with Australian Modern Awards, including the Building and Construction General On-site Award, which is built into the system and functions as a comprehensive building and construction award pay guide that automatically updates when Fair You don’t manually adjust rates, you avoid using outdated figures, and you eliminate the need for hours of cross-referencing award documents.
Classification levels, base rates, overtime thresholds, penalty triggers — all configured and ready to go.
Custom EBA and Enterprise Agreement Rules
But awards are just the starting point. Quality award interpretation software enables you to create custom pay rules tailored to your specific EBAs.
Whether you’re operating under a CFMEU, ETU, or CEPU agreement, you can configure:
- 36-hour working weeks with correct RDO accruals
- Double-time-all-overtime provisions
- Site-specific allowances by location
- Classification-based pay scales unique to your agreements
- Minimum engagement rules and casual conversion thresholds
Once configured, the software automatically applies these rules. No manual lookups or hoping you remembered which site operates under which agreement.
Automatic Overtime and Penalty Calculations
The system knows what day it is, what time shifts start and end, and which rules apply to which employees. When someone works past their ordinary hours, overtime is calculated automatically. Weekend work? Penalties apply. Public holiday? Different rate kicks in.
You’re not building formulas in Excel and praying they’re right. The software handles it based on the award or EBA rules you’ve configured, every single time.
Real-Time Labour Costing
Here’s a bonus: you know your labour costs before you finalise payroll. The software shows you exactly what each project is costing in real time, with budget-versus-actual tracking across multiple job sites. That means you can spot cost blowouts early, adjust scheduling, or have conversations with clients before margins disappear.
Integrated Timesheet Data
When timesheets flow directly into payroll, there’s no double-handling. Workers clock on using construction timesheet software with GPS verification. Supervisors approve hours. The data syncs automatically into the payroll system with correct rates already applied.
No rekeying times. No transcription errors. No wondering if the hours submitted actually match what was worked.
Compliance Reporting and Audit Trails
Every pay run generates clear records. Payslips break down exactly how pay was calculated — base rate, overtime hours, penalties, allowances, RDO accruals. If Fair Work comes knocking (and they’ve identified construction as a priority sector for 2024-25), you’ll have audit-ready documentation showing that you paid correctly.
Fair Work recovered $358 million in underpayments across all industries in 2024-25, with construction remaining a key enforcement focus. From 1 January 2025, intentional underpayments became a criminal offence with penalties up to $7.825 million for companies. That’s not theoretical risk—that’s the landscape you’re operating in.
Key Features to Look for in Construction Payroll Software
Not all payroll systems can handle construction complexity. Here’s what actually matters.
Robust Award Interpretation Engine
It needs to handle both Modern Awards and custom EBAs. If the software can only process the basic award structure but fails to accommodate your CFMEU agreement’s 36-hour week and double-time overtime, it’s not fit for purpose.
Look for systems with custom pay rule builders that let you configure exactly how your agreements work.
Timesheet Integration
Payroll should pull directly from digital timesheets. Mobile access for workers on-site, supervisor approval workflows, and automatic sync to payroll calculations. That eliminates manual data entry and the errors that come with it.
Accounting Software Integration
Your payroll should talk to your accounting system. Whatever platform you’re using, seamless integration means that payroll data flows through to your general ledger without requiring manual export-import processes.
That saves time, reduces errors, and keeps your financial reporting accurate.
STP Phase 2 Compliance
Single Touch Payroll Phase 2 requires detailed reporting to the ATO, including disaggregation of gross payments and correct income type classifications. Your payroll software should handle this automatically, submitting the right data in the right format every pay run.
Scalability and Unlimited Users
Construction businesses grow, contracts change, and crew sizes fluctuate. Software that charges per user becomes expensive fast when you’re scaling up. Look for platforms that offer unlimited users so your software costs don’t balloon as your team expands.
Australian-Based Support
When something breaks, or you need help configuring a new EBA, you want support from people who understand Australian awards and Fair Work requirements. Local support teams respond more quickly and have a deeper understanding of how the system should function in the Australian context.
Benefits of Automated Construction Payroll
Beyond just getting the calculations right, here’s what automation delivers.
Eliminate Underpayment and Overpayment Errors
Automated calculations remove human error. Once configured correctly, the software applies award rules consistently across every employee, every shift, every pay run. That protects you from Fair Work penalties and ensures your workers are not short-changed.
One classification error across 50 employees over six months can easily turn into a six-figure underpayment problem. Automation prevents that.
Save Hours (or Days) on Every Pay Run
Manual payroll for 30 construction workers with varying classifications, sites, and agreements can take two full days. With automated payroll software, that same process takes under an hour.
That’s not an exaggeration. For a team of 30 staff, payroll typically takes less than one hour per week when timesheets feed directly into an automated system with pre-configured award rules.
That time goes back to your business — into project management, client relationships, or actually growing the company instead of drowning in spreadsheets.
Reduce Compliance Risk
Fair Work audits are increasing, and construction is a target sector. Wage theft laws carry serious penalties — up to $7.825 million for companies convicted of intentional underpayment.
Automated systems keep you compliant with up-to-date award rates, clear audit trails, and accurate document management that proves you’ve paid correctly. When rates change annually, the system updates automatically. You’re not scrambling to manually adjust hundreds of pay calculations.
Improve Worker Satisfaction
Accurate pay builds trust. When workers see transparent payslips with full breakdowns of base rates, overtime, penalties, and allowances, they understand exactly how their pay was calculated. Fewer payroll disputes. Less friction. Better retention.
In an industry where skilled labour is scarce and expensive to replace, keeping your best workers happy matters.
Getting Started with Construction Payroll Software
So, where do you actually begin?
Assess Your Current Pain Points
Start by identifying exactly where the problems are:
- Which awards or EBAs do you operate under?
- How many hours does payroll currently take each week?
- How often do errors happen, and what’s the cleanup cost?
- Have you had Fair Work complaints or near-misses?
Document the current state. That clarity makes it easier to evaluate whether new software actually solves your specific problems.
Choose Software That Speaks Your Award
Not all payroll platforms handle construction complexity. Generic systems might cover basic awards, but they fall apart when you introduce EBAs with 36-hour weeks, RDO calendars, and stacked allowances.
Look for Australian-built, construction-focused solutions with proven EBA support, not just Modern Awards.
Plan for Smooth Onboarding
Moving from spreadsheets or an old system to automated payroll takes planning:
- Data migration from existing systems
- Configuration of your specific awards and EBAs
- Staff training on new workflows
- Ongoing support availability when questions arise
A good provider will handle the heavy lifting — migrating historical data, configuring complex agreements, and training your team so you’re confident from day one.
How Wojo Handles Complex Construction Award Rates
Pre-Built Awards
Wojo Pay provides Australian Modern Awards pre-configured, including the Building and Construction General On-site Award (MA000020).
Custom EBA Rule Engine
CFMEU, ETU, and CEPU agreements are fully supported. You can enter custom payment rules for ordinary hours, overtime calculations, allowances, and RDO accruals.
Automatic Overtime & Penalty Calculations
The software knows what time shifts start, what day it is, and which award or EBA applies.
Seamless Timesheet Integration
Data flows directly from Wojo Timesheets to Wojo Pay.
Accounting Software Integrations
Wojo integrates with Xero, MYOB, QuickBooks, Reckon, Microsoft Dynamics 365, Oracle NetSuite, Sage, and more.
STP Phase 2 Compliant
Wojo automatically submits Single Touch Payroll data with correct disaggregation and income type classifications.
Real-Time Reporting
Know your labour costs instantly. Track budget versus actual by project.
Unlimited Users
Wojo scales with your business. Add as many users as you need without the software bill doubling.
Construction payroll is complex, but the right software makes it manageable. Automation eliminates errors, saves time, and ensures compliance. Fair Work penalties for getting payroll wrong far outweigh the investment in proper payroll software.
CFMEU, ETU, CEPU and beyond — Wojo speaks your award. Less admin, more time, bigger margins.
Ready to simplify your construction payroll? Book a call with Wojo to see how we handle Caward rates automatically, so you can spend less time on admin and more time growing your business.
