PALM Payroll Explained: 120 Hours, the Under-20-Hours Rule and the $200 Safeguard

Information checked 15 September 2026. Australian general information; individual circumstances and the current official requirements still need to be checked.

A short-term PALM worker offered 15, 35, 35 and 35 hours across four weeks has been offered 120 hours in total. That does not remove the separate accommodation-and-transport obligation in the 15-hour week, or the need to check net pay each week.

The practical payroll task is to reconcile all three tests alongside the worker’s employment entitlements. A four-week total or a bank payment above $200 cannot, by itself, show the payroll is correct.

The three tests

The PALM minimum-hours and net-pay factsheet and current Guidelines, sections 3.7 and 5.1, set out the following safeguards.

Long-term placements have a different hours requirement: full-time work each week, subject to the applicable employment instrument. Do not apply the short-term averaging example below to a long-term worker.

Assumptions for this worked example

This is a hypothetical September 2026 payroll, not an actual worker’s payslip. The assumptions are deliberately explicit so a payroll officer can identify what would change for a real person.

• An adult short-term PALM worker is correctly classified as a casual Level 2 employee under the Horticulture Award. There is no enterprise agreement or other higher applicable entitlement.
• The agreed ordinary hourly rate is $40, including casual loading. This is an illustrative contractual rate, not a statement of the award minimum. The award’s adult Level 2 ordinary casual rate is $33.05 from the first full pay period starting on or after 1 July 2026.
• All 120 hours are reasonably and genuinely offered, accepted and worked. The period is four complete weeks. Work is during ordinary weekday daytime hours, with minimum engagements and breaks satisfied, and no overtime, public holiday, piecework, allowance, leave, absence, shutdown or stand-down adjustment.
• The worker is a foreign resident for tax purposes and employed by a PALM Approved Employer. The applicable withholding is 15%. Residency is an assumption that must be checked for a real worker.
• Ordinary weekly costs are $180 accommodation, $40 transport and $30 health insurance. A proposed $310 weekly repayment relates solely to otherwise permissible, documented personal-cost advances, with sufficient outstanding balance and a lawful recovery schedule of at least twelve weeks.
• All deductions have been independently checked as lawful, at cost, reasonable, properly explained and genuinely authorised in writing. These assumed amounts do not establish that a real employer may deduct them.

The current Horticulture Award, Schedule B.3.1 supports the rate comparison. The ATO’s PALM employer guidance supports the 15% withholding assumption. Australian tax residents use the applicable regular tax tables; not every PALM worker has the same withholding treatment.

Calculate wages and tax first

Employer superannuation and other employer on-costs sit outside this take-home-pay calculation. They have not been deducted from the worker’s wages or treated as satisfying the $200 safeguard.

Apply the weekly protections before deducting

Week 1 has fewer than 20 hours offered. The employer therefore bears the $220 accommodation and transport cost. It is not deducted now, deferred to a later week or added to the advance balance.

After tax, $510 remains. Deducting $30 insurance and the proposed $310 repayment would leave only $170. The repayment is therefore reduced by $30 to $280, leaving $200. The deferred $30 is different from the $220 employer-borne cost: it remains subject to a lawful repayment arrangement and the scheme’s limits.

The reconciliation is $4,800 gross − $720 tax − $1,990 deductions = $2,090 net wages. The employer separately bears $220. The advance ledger shows $30 less recovered than the original four-week schedule; it is not automatically added to Week 2.

If the hours or circumstances change

If required short-term hours are not offered, the Guidelines provide for payment for the shortfall at the offer-of-employment base rate in the following pay cycle. Reasonable offers declined by the worker, partial periods and relevant public holidays require their specific treatment. Keep evidence of offers and refusals, rather than inferring everything from hours worked.

Special shutdown, stand-down and departmental force-majeure provisions also need separate checking. Bad weather does not create a self-declared exemption. Outstanding debt cannot be carried into the next placement after the worker completes the placement and returns home.

A reconciliation tool for the farm and payroll team

1. Confirm placement type, fixed period, employment instrument, classification and contractual pay.
2. Match rosters and time records to hours offered, worked and genuinely declined.
3. Calculate all gross entitlements and any required shortfall payment.
4. Apply the correct tax treatment for this worker and employer.
5. Remove employer-borne accommodation and transport costs in any under-20-hours week.
6. Check each remaining deduction and adjust permitted repayment scheduling where needed to preserve net pay.
7. Reconcile the payslip, bank payment, cost invoices, employer expense and advance ledger. Have another responsible person review exceptions before the pay run is released.

For related context, see Orchard Tech’s PALM and Working Holiday Maker comparison. Apply this worksheet to the actual employment facts; it is not a substitute for resolving an uncertain classification, deduction or exception.

Sources and review date

Checked 15 September 2026.

• PALM Approved Employer Guidelines v2.1: sections 3.7, 5.1 and 5.3, pages 30–33 and 43–46
• PALM minimum hours and net pay guarantee factsheet, 14 October 2025
• Horticulture Award MA000028: Schedule B.3.1, adult casual rates from July 2026
• ATO: Employers of PALM scheme workers, withholding rate and residency distinctions

Feature image: AI-generated illustration with fictional people and setting.

About the author

Hari Yellina is Chief Executive Officer at Orchard Tech. His articles explain practical agricultural workforce and workplace questions. Explore the Knowledge Centre.