2026 State of Payroll Compliance report

New wage theft laws in Australia, which took effect on 1 January 2025, criminalised the intentional underpayment of wages and entitlements and placed heightened emphasis on payroll risk.

Yet despite new controls, stronger oversight and heightened awareness, the 2026 State of Payroll Confidence Report reveals that one in three employers are not confident they are paying employees correctly.

Award interpretation and system complexity remain difficult, but the expansion of ownership across HR (58%), Finance (55%) and boards (30%) is an encouraging shift that reflects stronger collaboration around payroll. This year’s results show, however, that cross-functional ownership needs to be paired with clearer visibility into payroll data and risks to grow confidence.

Many organisations have strengthened governance by tightening controls, improving oversight and upgrading systems. But the shift is uneven. Mid-sized employers are working to build capability, while large enterprises are embedding more formal assurance frameworks. Across the market, leaders are increasingly tu ning to automated and independent payroll auditing technology as part of a move toward continuous, evidence-based compliance.

Yellow Canary's 2026 State of Payroll Confidence Report delivers a data-backed view of where organisations stand, and where their greatest vulnerabilities lie. It highlights the actions leaders must prioritise to protect employees, strengthen governance and build confidence through transparency and independent verification.

We surveyed compliance leaders across Australia to understand:

• How confident organisations are in their payroll accuracy
• The impact of wage theft reforms on governance and liability
• Who owns payroll compliance and how this is shifting
• The biggest sources of risk across awards, systems, processes and capability
• How often payroll is audited, and by what methods
• Adoption of automation and AI-driven assurance
• Payroll compliance budget trends and cost pressures

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Download the report to understand how your organisation compares, and what it will take to maintain trust and lead with confidence as regulatory expectations continue to evolve.

Research methodology

The research, commissioned by Yellow Canary and conducted by Lonergan Research in accordance with the ISO 20252 standard, surveyed 540 Australian business and payroll decision makers in organisations with 50 or more employees. Conducted online between 20 October and 24 October 2025, participants were sourced through a permission-based panel with representation across capital and regional areas nationwide.

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