Alex is Sprintlaw's co-founder and principal lawyer. Alex previously worked at a top-tier firm as a lawyer specialising in technology and media contracts, and founded a digital agency which he sold in 2015.
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When you’re hiring your first employee (or your fiftieth), a lot of terms get thrown around: base salary, package, OTE, fixed remuneration, super, allowances, bonuses, loadings and “total cost to company”.
And then there’s the phrase that often pops up in recruitment conversations and job applications: current base salary.
If you’re an Australian employer or startup founder, understanding what a current base salary is (and how it differs from other pay concepts) helps you do three important things:
- Make accurate, competitive offers without unintentionally overcommitting.
- Stay compliant with Fair Work obligations and your employee’s applicable award or enterprise agreement.
- Draft clear employment contracts that reduce misunderstandings and pay disputes down the track.
Below, we break down what “current base salary” means, when you’ll run into it, and how to handle it in a way that’s fair, compliant and practical for a growing business.
What Is A Current Base Salary?
Current base salary generally means the employee’s present (or most recent) guaranteed salary amount, before additional earnings like bonuses, commissions, overtime, allowances and loadings. Whether it includes superannuation depends on how the employer (and candidate) usually describes pay, so it’s worth checking.
In other words, when someone tells you their current base salary, they’re usually describing the “fixed” part of their pay that is paid regularly and doesn’t depend on performance or hours above their ordinary hours.
In an employment context, base salary is often expressed as an annual figure for full-time employees (for example, $90,000 per year), but it can also be expressed as:
- a weekly amount,
- a fortnightly amount, or
- an hourly rate (more common for award-covered roles and casual employment).
What “Current” Usually Means In Practice
“Current” typically refers to what the candidate is being paid right now (or, if they’ve recently left, what they were paid in their most recent role). It’s not necessarily the salary they started on, and it may not include any recent changes unless they’ve already taken effect.
It’s also worth noting that “current base salary” is not a defined legal term under the Fair Work Act - it’s a common HR and recruitment phrase. That means there can be variation in how candidates interpret it (which is why it’s helpful to ask a clarifying question or two).
Base Salary vs Total Remuneration: What Counts And What Doesn’t?
Many pay disputes (and recruitment misunderstandings) happen because two people are talking about “salary” but meaning different things.
Here’s a practical breakdown of what a candidate might include in “salary” - and what is usually excluded from “current base salary”.
Typically Included In Base Salary
- Guaranteed ordinary-time pay (the fixed amount paid for ordinary hours under the role).
- Annualised salary if the employee is on a salary rather than an hourly rate (subject to award compliance if applicable).
Typically Not Included In Current Base Salary
- Superannuation (some people quote base salary “+ super”, while others roll super into “total package”).
- Bonuses (annual, sign-on, retention or discretionary bonuses).
- Commissions and incentives (including OTE - on-target earnings).
- Overtime (especially where hours vary or are paid at penalty rates).
- Allowances (for example, car allowance, travel allowance, uniform allowance, first aid allowance).
- Salary sacrifice benefits (for example, additional super contributions, novated lease arrangements) - noting these can involve tax and financial considerations.
- Non-cash benefits (for example, company car, shares/options, expense accounts).
- Leave loading (relevant in some award-covered roles).
If you’re using a candidate’s current base salary as a reference point for your offer, your goal is to compare like-for-like - and that usually means confirming whether the figure is inclusive or exclusive of super.
If you’re unsure how to structure your offer language (especially around “package” vs “base + super”), it can help to use terminology like fixed remuneration consistently in the contract.
Why Employers Ask “What Is Your Current Base Salary?”
From an employer’s perspective, there are a few legitimate reasons this question comes up.
1) Benchmarking Your Offer
Knowing a candidate’s current base salary can help you sense-check whether your budget is in the right range. For example, if you’re offering $75,000 base and the candidate is currently on $110,000 base, you’ll want to address that gap early.
2) Designing The Right Package Structure
Startups often use different levers to put forward an attractive offer: flexible work, career development, a bonus structure, or equity. Having the candidate’s current base salary helps you understand what’s “fixed” in their current role and what might be variable.
3) Managing Pay Equity Internally
If you already have a team, you’ll want consistency between new hires and existing employees doing similar work. Current base salary data can be part of that picture - although you should also consider the role scope, skills, experience and market rate.
4) Negotiation And Risk Management
Some employers ask because they don’t want to overpay relative to the market, or because they want to anticipate negotiation points (e.g. “I’d move for a 15% uplift”).
That said, as an employer, it’s worth being careful not to treat “current base salary” as the only benchmark. It can anchor negotiations to a number that might be too low (if the candidate was underpaid) or not reflective of your role’s market value.
How To Use “Current Base Salary” When Making An Offer (Without Creating Confusion)
When you’re moving quickly in recruitment (especially in a startup), it’s easy to reach agreement verbally and assume everyone’s on the same page. Then the contract goes out and suddenly you’re fielding questions about super, bonus, or what “package” means.
Here’s a practical approach to avoid that.
Step 1: Ask A Clarifying Question Early
If a candidate tells you their current base salary, consider asking:
- “Is that figure inclusive or exclusive of super?”
- “Does that include any guaranteed allowances?”
- “Are you on an annualised salary or an hourly rate?”
This keeps the conversation straightforward and reduces the risk of mismatched expectations.
Step 2: Decide How You Will Present Your Offer
In Australia, employers commonly present remuneration in one of two ways:
- Base salary + super (e.g. “$95,000 + super”); or
- Total remuneration package (e.g. “$104,500 package inclusive of super”).
Neither is “wrong”, but you should pick one approach and be consistent across your letter of offer and employment contract.
Step 3: Put The Details In Writing (Properly)
Your employment contract should clearly set out:
- the base salary (or base hourly rate),
- how and when it is paid,
- whether the salary is inclusive or exclusive of super,
- any bonus or commission rules (and whether they’re discretionary), and
- any allowances or reimbursements.
This is one of the reasons a tailored Employment Contract matters - it’s not just paperwork, it’s your roadmap for how pay is calculated and what’s actually promised.
Step 4: Check Award Coverage Before You “Set And Forget” A Salary
Many small businesses assume salaries are automatically “award-free”. In reality, a large number of roles are covered by a modern award, even if you’re paying above the minimum.
If an award applies, you may need to consider things like:
- minimum rates of pay,
- penalty rates and overtime,
- annualised wage clauses (if you’re using an annual salary to cover award entitlements), and
- record-keeping obligations.
If you want certainty on classification, rates and entitlements, it may be time to look at award compliance as part of your hiring process.
Common “Current Base Salary” Scenarios For Startups (And How To Handle Them)
Startups often have unique compensation arrangements, and it’s easy for base salary questions to get tangled with incentives and equity. Here are a few scenarios we see often.
A Candidate Quotes A “Package” Number As Their Base
A candidate might say: “My current base salary is $120,000,” but they actually mean “$120,000 package inclusive of super”.
If you rely on that figure, you could accidentally overestimate what they’re currently taking home as cash salary. The fix is simple: confirm whether their number includes super.
A Candidate Has A Big OTE Component
In sales roles, candidates sometimes focus on OTE because it reflects what they expect to earn (base + commissions if targets are hit). But OTE is not the same as base salary.
When you’re discussing remuneration, make it clear which parts are:
- guaranteed (base salary), and
- variable (commission/bonus).
Then make sure your contract aligns with what you’ve discussed (including when commissions are earned and payable).
A Candidate Is Moving From Casual To Permanent (Or Vice Versa)
A casual worker’s hourly rate may include a casual loading (often 25% under many modern awards) to compensate for the lack of paid leave entitlements. A permanent employee’s base salary (or hourly rate) generally does not include that loading.
So, if a candidate compares their “current base” casual rate to your full-time salary offer without adjusting for entitlements, it can look like a pay cut when it isn’t.
If you’re hiring casuals, it also helps to set expectations clearly with a Casual Employment Contract that explains how pay works, including loadings where applicable.
A Candidate Is On An Annualised Salary That Covers Extras
Some employees are on annual salaries that are intended to cover overtime, penalties, allowances or other entitlements. If that’s the candidate’s current arrangement, they may still call it a “base salary”, even though it functions more like a bundled package.
If you’re considering doing something similar, be cautious: if an award applies, annualised wage arrangements can come with specific rules (which vary by award) such as record-keeping requirements and, in some cases, reconciliation or “top-up” obligations to ensure the employee is not worse off overall.
What Legal And HR Documents Help You Define Base Salary Clearly?
Defining base salary well is a mix of compliance and communication. The clearer you are in writing, the less likely you’ll face disputes later.
Here are the documents that commonly matter.
Employment Contract
Your employment contract should clearly define the employee’s pay, including what the base salary is and how it is paid. It should also cover performance, confidentiality, termination, leave and other key terms.
As your business grows, inconsistent contract templates can create inconsistent pay obligations - so it’s worth having one solid foundation document in place from day one.
Workplace Policies (Where Relevant)
Depending on your business, policies can support consistent payroll practices (for example, policies on overtime approval, time off in lieu, expenses and allowances). Policies don’t replace the contract, but they can help manage day-to-day expectations.
Company Structure Documents (For Startups)
While not directly about salary, startups often offer mixed remuneration (salary + equity) and have multiple decision-makers involved in hiring. Having clear governance documents reduces internal disputes about who can approve salary changes or offer bonuses.
- A Company Constitution sets out rules for how your company is governed.
- A Shareholders Agreement can clarify decision-making and founder rights (which can be particularly helpful when remuneration decisions affect runway and fundraising plans).
Privacy And Record Keeping
If you’re collecting salary information during recruitment (including current base salary), treat it as sensitive HR information. Even when you’re a small business, it’s good practice to collect only what you need and store it securely.
If you collect personal information through your hiring process or website, a Privacy Policy may be relevant to your broader compliance approach.
This article is general information only and isn’t legal, financial or tax advice. If you’re considering salary packaging or salary sacrifice arrangements, it can be worth getting advice specific to your business and the employee’s circumstances.
Key Takeaways
- What is a current base salary? It’s usually the candidate’s present guaranteed pay amount for ordinary hours, excluding variable earnings like bonuses, commissions and overtime (and it may be quoted either inclusive or exclusive of super, depending on how their employer structures pay).
- “Current base salary” is a common HR term rather than a strict legal definition, so candidates may interpret it differently - it’s worth confirming whether their figure includes super or other guaranteed amounts.
- To avoid misunderstandings, present your offer clearly as either “base + super” or “total package inclusive of super”, and keep your terminology consistent in writing.
- If an award applies, paying a salary doesn’t automatically remove award obligations - you still need to ensure minimum entitlements are met and documented.
- A well-drafted Employment Contract is one of the best ways to define base salary and protect your business from disputes as you scale.
If you’d like help putting together an employment contract and pay structure that fits your business, you can reach us at 1800 730 617 or team@sprintlaw.com.au for a free, no-obligations chat.
