Ordinary Time Earnings (OTE)
Ordinary Time Earnings, or OTE, are Australian employee earnings connected with ordinary hours of work, together with certain specified payments.
OTE was the familiar earnings base used to calculate minimum Superannuation Guarantee contributions before Payday Super. From 1 July 2026, Australian employers calculate SG on the broader Qualifying Earnings base.
OTE has not become irrelevant. All OTE is included in Qualifying Earnings, and the term remains important for understanding older pay periods, transition records, payroll categories, awards and the relationship between ordinary pay and super.
The ATO’s Payday Super guidance explains that Qualifying Earnings brings together OTE and other payments from 1 July 2026.
Where Ordinary Time Earnings Appear
You may still see OTE in:
- payroll pay-item settings
- super calculations for periods before 1 July 2026
- awards, agreements and employment contracts
- payroll audits and historical corrections
- super guarantee charge work
- accountant or payroll-adviser queries
- explanations of how Qualifying Earnings developed
- transition checks around the start of Payday Super
The payment label alone is not decisive. A bonus, allowance or loading may need different treatment depending on why it was paid and whether it relates to ordinary hours.
How OTE Works In Practice
Under the traditional OTE framework, the core idea was earnings for ordinary hours of work. The statutory definition also included over-award payments, shift loadings and commissions, subject to detailed rules and exclusions.
The Superannuation Guarantee legislation contains the legal definitions. Employers should use current ATO guidance and professional advice when a payment type is unclear rather than relying on a simple label in payroll software.
Common review questions include:
- Which hours are ordinary under the award or agreement?
- Is a loading attached to ordinary hours or overtime?
- Does a bonus relate to ordinary performance?
- Is paid leave treated as ordinary earnings?
- Is the payment for a period before or after 1 July 2026?
- Does the amount fall within the current Qualifying Earnings rules?
Simple Example
Before 1 July 2026, an employee earns:
- ordinary wages: $1,200
- shift loading on ordinary hours: $120
- overtime worked outside ordinary hours: $180
If the ordinary wages and shift loading are OTE while the overtime is not, the OTE total is $1,320.
At a 12% SG rate, the simple contribution calculation would be:
$1,320 x 12% = $158.40
For earnings paid from 1 July 2026, the employer must instead identify the employee’s Qualifying Earnings under Payday Super. Those earnings include OTE but may also include other amounts, so the historical OTE total should not automatically be reused as the current base.
OTE Versus Gross Pay And Qualifying Earnings
These figures answer different questions:
- Gross pay is the broad amount earned before deductions.
- OTE identifies earnings connected with ordinary hours and specified related payments.
- Qualifying Earnings is the current Payday Super earnings base from 1 July 2026.
- Net pay is what remains after withholding and employee deductions.
An employee can therefore have gross pay that is higher than OTE, and Qualifying Earnings that differ from both. Payroll should calculate each figure from the rules that apply to it.
Why Ordinary Time Earnings Matter
OTE classification affected how much super an employer owed for earlier periods. A wrong classification can still matter when correcting historical payroll, reviewing the final pre-Payday-Super quarter or responding to an employee query.
It also provides useful context for the current system. Understanding which payments were OTE makes it easier to see why Qualifying Earnings is broader and why old payroll mappings need review.
Common mistakes include:
- treating all gross pay as OTE
- excluding a payment because it is called an allowance without checking its purpose
- including overtime solely because it appears in gross earnings
- applying pre-July 2026 settings to current paydays
- overwriting old records during a payroll-category migration
Regional Variations
OTE is an Australian superannuation term. Other countries use different earnings bases for employer retirement, social insurance or pension contributions.
New Zealand, Ireland, Canada and Singapore each apply their own statutory definitions. Do not translate an Australian OTE setting directly into another country’s payroll.
How Gimbla Can Help
Gimbla Payroll keeps pay items, pay runs, super calculations and accounting records together. Clear effective dates and category mappings help preserve historical OTE records while supporting Qualifying Earnings and Payday Super from 1 July 2026.
Related Terms
Helpful Gimbla Guides
In Short
Ordinary Time Earnings are earnings connected with ordinary hours and specified related payments. OTE remains important for history and classification, but Qualifying Earnings is the current SG base for payments from 1 July 2026.