AustraliaEmployer of Record

Australia Employer of Record

COVID-19 status update

COVID-19 status update: As the situation in Australia continues to develop, Safeguard Global will be providing in-country intellect to our clients regarding legislative changes affecting employees and impacting businesses, as well as government recommendations on how to keep employees safe and healthy.

As of today, we have not identified any disruption that will impact our ability to provide the service our clients expect. Learn more in our COVID-19 Resource Center.

If a lack of speed or local expertise are among your top concerns when expanding to or employing workers in Australia, an employer of record may be the best option for achieving your global growth objectives.

An employer of record, sometimes known as an international PEO, enables you to quickly hire and onboard workers in Australia―often in as little as two weeks―without having to take on the cost and risk of establishing a local entity.

Learn about the hiring, employment, payroll and benefits requirements for workers in Australia and how our employer of record service, Global Employment Outsourcing (GEO), and local HR experts can help you manage your international employment needs.

Hiring in Australia

In Australia, both the federal and state governments have the power to pass labor legislation. Since the mid-1990s, the federal government has often used its constitutional power to override state labor laws in order to unify employment regulations under federal law.

The Australian workplace is governed by the Fair Work Act 2009, and the Fair Work Commission operates as an independent labor-relations referee.

In addition to widespread anti-discrimination policies that cover things like equitable gender pay to sexual orientation, large privately owned companies are required to have a whistleblower policy that clarifies the reporting process and protections for employees. Employers who violate their whistleblower policy, or fail to have one, are subject to fines.

Though not as prevalent as in the U.S., the gig economy is on the rise in Australia.

Since employment in Australia is highly regulated, compliant employment contracts are an essential business need. As your employer of record and PEO in Australia, we can ensure that every contract, for every worker, meets all requirements. We can also provide you with guidance about cultural norms and hiring best practices and keep you up-to-date with employment regulations as they change.

Employment contracts in Australia

As you look to hire employees in Australia, here are some common regulations you’ll need to know to create a compliant contract, as well as how an employer of record and PEO can provide support for your unique HR needs.

Working hours
The standard workweek is 38 hours, with each workday lasting 7.6 hours.

Employers can ask employees to work additional hours if they are “reasonable,” which involves factors such as whether the workers are eligible for overtime, their family responsibilities, their job roles and responsibilities, business needs and what is typical for that industry. Workers can refuse to work additional hours if they are not considered reasonable.

Employer-employee contracts (referred to as awards) and collective bargaining agreements (referred to as enterprise agreements) set the workday hours and often prescribe a minimum period of rest between work days. They may also limit the amount of overtime that can be worked.

Compensation
As you consider the appropriate salary to offer new employees, keep in mind:

  • Minimum wage is A$753.80 per week.
  • Minimum wage for workers covered by collective bargaining agreements may be specified in those agreements, taking into consideration the national minimum wage.
  • Workers must be paid at least once a month.
  • Overtime pay is dictated by collective bargaining agreements rather than by law.

As your employer of record in Australia, we can provide you with resources and insights about employee compensation, so you are better equipped to make a competitive employment offer.

Bonuses
Performance-based bonuses are common, though not mandatory.

Probationary period
Employers may put employees on a probationary period that can last from several weeks to several months. During this time, employees must still be allowed to accrue and access annual leave and sick leave.

Termination and severance
Notice of termination is based on the length of employment, and ranges from one to four weeks. An extra week must be added if the employee is 45 or older and has been employed for two or more years continuously.

An employer may choose to pay the employee in lieu of providing notice, in which case the amount of pay must be equal to the number of weeks’ notice the employee is required to receive.

Neither notice nor compensation is required for termination resulting from serious misconduct, or for several classes of employees, such as seasonal workers.

In companies where there are more than 15 employees, severance must be paid if termination is the result of a redundancy and the employee was employed for at least 12 months. Severance ranges from four to 12 weeks of pay, depending on the length of employment.

As your employer of record in Australia, we can work with you to quickly handle the unforeseen event of an employee termination, providing legal guidance and a personalized process that ensures you stay out of labor court.

Employee benefits and paid leave in Australia

When negotiating terms of an employment contract with a candidate in Australia, here are some of the statutory benefits and paid leave requirements to keep in mind, as well as how an employer of record can support your company’s benefits strategy.

Maternity leave
Pregnant employees are entitled to 18 weeks of Paid Parental Leave (PPL) at the national minimum wage, or A$753.80 a week. They may begin their leave up to six weeks before the expected birth. The government funds 100% of this salary, though the benefits are paid through the employer.

To be eligible for PPL, an employee must meet the following criteria:

  • Be the primary caregiver of a newborn or recently adopted child
  • Meet Australian residency requirements
  • Be employed and have been working continuously for at least 10 of the 13 months prior to the birth or adoption, and for at least 330 hours during those 10 months
  • Not have worked between the birth or adoption and the PPL start date
  • Have had an adjusted taxable income of no more than A$150,000 in the previous year

A parent can request an extension of up to 24 months and the pregnant employee may receive special maternity leave in the case of illness, miscarriage or stillbirth.

Vacation
Full-time employees are entitled to four weeks of paid leave each year, which accrues progressively throughout the year and can be accumulated year to year. Employees can cash out their leave as long as they still have four weeks of accumulated leave left.

Although the law only requires that an employee receive their base salary for leave time, annual leave loading is a standard benefit. That means that employees are paid 17.5% above their base pay for each week they’re on vacation.

Long-service leave of between eight and 13 weeks of paid leave, generally after 10 years of service, is also available.

Holidays
The Fair Work Act calls for eight public holidays a year. States and territories may add additional public holidays or substitute them for others. Employers can also agree to different holidays during employment negotiations.

  • New Year’s Day
  • Australia Day
  • Good Friday
  • Easter Monday
  • Anzac Day
  • Queen’s Birthday
  • Christmas Day
  • Boxing Day

Sick leave
Personal leave, as sick leave is called in Australia, is bundled together with carer’s leave (time off to care for a family or household member). Employees receive 10 days of personal/carer’s leave annually, which can accumulate yearly.

There are several additional forms of leave:

  • Compassionate leave: 2 days paid leave if a family member has a life-threatening illness or dies
  • Community service leave: 10 days paid for jury service, and unpaid leave for other forms of community service
  • Reserve leave: unpaid leave for military duties
  • Family and domestic violence leave: 5 days unpaid per year

Health coverage
Australia has a universal public health insurance program called Medicare that provides free public hospital care as well as substantial coverage for doctor visits, prescriptions and certain other services. Roughly half of Australians also buy private insurance to cover private hospital stays, dental care and other services. The government pays a rebate to offset private insurance and charges a tax penalty on high-income households that do not purchase private insurance.

With recent tax increases and reduced rebates for high-income households, more large companies are offering fully or partially paid insurance plans to employees, primarily in IT and professional sectors where the competition for talent is high.

As your employer of record in Australia, we may be able to provide optional supplementary medical insurance coverage for professionals and their dependents at a more cost-effective rate.

Additional benefits
In addition to healthcare benefits, employees in Australia are entitled to pension, which is funded by government tax revenues, as well as workers compensation, which is covered through mandated employer insurance.

Employer social costs will cover a large portion of employee benefits in Australia, but we can consult with you about supplemental coverage options, such as additional pension contributions or life insurance, if needed.

Employee onboarding with an employer of record in Australia

We write and validate all local employment contracts, streamlining the onboarding process for you and your Australia employees—all you have to do is provide relevant information and review and approve the employment agreement.

As your employer of record in Australia, we will:

  • Schedule a welcome call to discuss HR and employment information for Australia, as well as answer any questions
  • Prepare a customized employment contract in English or other local language
  • Share the employment contract and benefits information with the new employee for signature and review
  • Gather tax and banking information from the employee to set up payroll
  • Provide a local point of contact to the employee to answer any questions regarding their employment, local HR or payroll

The entire onboarding process for the employee is often completed in as little as two weeks.

Partner with Safeguard Global as your Australia employer of record and PEO

With over a decade of service, we are the longest-serving employer of record and PEO provider in the international market. Organizations around the world rely on Global Employment Outsourcing (GEO) to expand and hire in over 179 countries around the world, quickly and compliantly.

We’ve seen just about every global employment circumstance imaginable—and with our extensive knowledge of local law and culture, we know what it takes to get employment right in Australia. We provide written contracts in the local language, salaries in the local currency and HR support in your employees’ time zone.

Additionally, as a global payroll provider we support payroll administration—including payments, filings and other calculations—in more than 150 countries and can accommodate the payroll outsourcing needs of any size organization.

Whether you’re looking to hire as part of a strategic expansion or to meet specific talent needs, our global solutions advisors can walk you through your international hiring options so you can make the right choice for your organization. Contact us today.

The information provided on or through this website is for informational purposes only and does not constitute legal advice. Safeguard Global expressly disclaims any liability with respect to warranty or representation concerning the information contained herein, including the lost essence, interpretation, accuracy and/or completeness of the information in transit and language translation.

Learn more about Global Employment Outsourcing

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