How to Reconcile Labour Hire Invoices Against Timesheets

Reconcile labour hire invoices by matching every billed worker, shift, hour, rate and allowance to an approved timesheet, then check on-costs, margin and GST separately. Do not approve the total just because the hours look close.

Why invoice totals go wrong

Most labour hire invoice errors are ordinary data mismatches. A worker is billed to the wrong site. Saturday hours are treated as ordinary time. An allowance appears twice. A shift crosses midnight and lands in both weeks.

The invoice may also use charge rates while the timesheet only shows hours. That makes a quick total comparison unreliable.

There are three records in play:

1. The approved site timesheet, which says when and where the work happened.
2. The agreed rate schedule, which says how the provider may charge.
3. The invoice, which asks you to pay specific quantities and rates.

Payroll records can provide a fourth check where your contract permits it. They help confirm that workers were paid under the correct award, enterprise agreement or other industrial instrument. An invoice alone does not prove correct worker pay.

For more on provider controls, licensing and worker records, see the labour hire guide.

Start with an approved timesheet cut-off

Pick one source of truth. Usually, that is the supervisor-approved timesheet captured before the weekly or fortnightly cut-off.

Each entry should include:

• worker name or unique ID
• labour hire provider
• site and cost code
• work date
• start, finish and break times
• ordinary and overtime hours
• shift type
• allowances or reimbursable items
• supervisor approval and approval date

Do not overwrite an approved timesheet to make it agree with an invoice. Record the correction as a separate adjustment. That gives you a clear audit trail.

Names also need attention. “Dave R” on a paper timesheet may be “David Robert Smith” on the invoice. Use a stable worker ID where possible.

Compare each invoice field

A line-by-line check is much safer than comparing weekly totals.

Check	Timesheet or contract source	Common invoice problem	Action
Worker	Worker ID and provider	Wrong worker or duplicate worker	Hold the affected line
Date and site	Shift record and cost code	Shift billed to another project	Request a credit or correction
Hours	Start, finish and unpaid breaks	Rounded hours or missed break	Recalculate from approved time
Rate	Signed rate schedule	Old rate or wrong classification	Apply the effective rate for that date
Overtime	Daily and weekly rules	All hours billed at ordinary rate	Split hours into the correct bands
Allowance	Approved entitlement or expense	Duplicate or unsupported allowance	Ask for evidence
Margin and on-costs	Commercial agreement	Percentage applied twice	Rebuild the charge calculation
GST	Tax invoice	GST added to a GST-inclusive rate	Confirm the contract wording

Your rate schedule should say whether the charge is all-inclusive or built from wages, statutory on-costs and a margin. If the wording is vague, settle it before approving further invoices.

Rebuild the expected charge

Say an approved timesheet contains 38 ordinary hours, 4 time-and-a-half hours and 2 double-time hours. The agreed charge rates are $52.00, $78.00 and $104.00 per hour.

The expected labour charge is:

• 38 × $52.00 = $1,976.00
• 4 × $78.00 = $312.00
• 2 × $104.00 = $208.00
• subtotal = $2,496.00

If the approved site allowance is $3.50 for each of the 44 worked hours, add $154.00. The taxable subtotal becomes $2,650.00. GST of $265.00 produces an invoice total of $2,915.00.

These are example contract rates, not award rates. The point is to calculate the expected amount independently. If the provider invoices 44 hours at one blended rate, ask for enough detail to verify the result.

Watch the units too. An allowance might be payable per hour, per shift, per day or once per project. A correct dollar rate with the wrong unit still produces an overcharge.

Check the statutory figures separately

Some fixed figures help with the review, but they do not replace the applicable award or agreement.

As at August 2026, the super guarantee rate is 12% of ordinary time earnings. The labour hire provider is generally responsible for paying super for its employees. Your commercial contract decides whether that cost is included in the charge rate or shown as a separate pricing component.

As at August 2026, GST is 10% on a taxable labour hire supply. Check that the provider is registered for GST and has issued a valid tax invoice before claiming a GST credit.

As at August 2026, Fair Work employee records generally need to be kept for 7 years. The provider holds the core employment records, but the host should retain approved timesheets, invoice checks, disputes and credits under its own record policy and contractual obligations.

As at August 2026, the National Employment Standards set 38 hours per week as the maximum weekly hours for a full-time employee, plus reasonable additional hours. That does not mean overtime always starts only after 38 hours. An award or enterprise agreement may trigger overtime by day, span, shift or roster pattern.

Do not simply add 12% super to an invoice unless the contract permits it. The same warning applies to payroll tax, workers compensation, portable long service leave, training levies and provider margin. They may be genuine provider costs, but whether you pay them as separate invoice items is a contract question.

Check award and labour hire rules

The rate schedule should match the work actually performed. Look at classification, employment type, location, shift, day and start time. Construction work can involve overtime, weekend penalties, public holiday rates, fares, travel, site allowances and minimum engagement rules.

Also consider whether a regulated labour hire arrangement order applies under the Fair Work Act. Where an order is in force, the provider may need to pay protected rates linked to the host’s enterprise agreement. Do not assume every labour hire arrangement is covered. Check the actual order, workers and dates.

Labour hire licensing also operates in several Australian jurisdictions. Invoice approval is a useful point to confirm that the provider’s licence details remain current where a scheme applies.

Use the compliance audit tool to review the rate source, approval trail, worker records and exceptions before the invoice is released.

Set tolerances carefully

A tolerance can reduce noise, but it should not hide time or rate errors. A five-minute rounding difference is not the same as an unapproved five-hour shift.

Good tolerance rules usually separate:

• time differences
• rate differences
• dollar differences
• missing workers
• duplicate shifts
• unsupported allowances

Never auto-approve a line merely because the total difference is under a dollar limit. A low-value error can expose a repeated setup problem across hundreds of shifts.

Handle discrepancies before payment

Put disputed lines on hold and pay undisputed amounts where the contract allows it. Send the provider a clear exception report showing worker ID, date, billed value, expected value and reason.

Ask for a corrected tax invoice or credit note. Do not alter the supplier’s invoice inside your accounting system to force a match.

Common warning signs include consecutive invoice numbers that contain duplicate shifts, sudden classification changes, unexplained rate increases, GST applied twice and the same worker billed by two providers.

Finally, separate preparation from approval. One person can import the timesheets and build the comparison. Another should review exceptions and release payment. It is a simple control, and it makes quiet invoice errors much harder to miss.