Hire Employees in Australia

An Australian entity is normally a proprietary limited company, requiring an ACN from ASIC, at least one director ordinarily resident in Australia, an ABN and PAYG withholding registration, plus workers’ compensation insurance in each state where staff work.

An Employer of Record signs the Australian contract, runs payroll with Single Touch Payroll reporting, pays superannuation and manages award classification and workers’ compensation. The resident director requirement is often the practical reason a first Australian hire goes through an EOR.

Superannuation follows labour, not employment status. A contractor engaged mainly for their personal labour is entitled to the 12% guarantee even where they invoice through an ABN. Many foreign companies discover this only when the ATO raises a Superannuation Guarantee Charge.

Break-even rule of thumb: EOR fees begin to exceed the running cost of a small Australian entity somewhere between 15 and 20 employees. Model both before committing, see EOR vs Entity for the full comparison, and plan any later migration so employees keep seniority.

Already paying someone in Australia as a contractor? Run the risk check before the arrangement is tested by an audit.

Not sure which model fits? A GX specialist will cost EOR vs entity for your exact headcount, free, within two business days. Get a model recommendation

The National Minimum Wage sets the floor for award-free employees, and is reviewed annually by the Fair Work Commission with changes taking effect from 1 July. Most employees are instead covered by a Modern Award setting higher classification-based minimums.

Pay frequency is not prescribed by statute but must be at least monthly, and fortnightly is most common. Payslips must be issued within one working day of payment and must contain prescribed information including superannuation contributions.

Annualised salary arrangements can absorb award entitlements such as overtime and penalty rates, but only where the arrangement satisfies strict record-keeping and reconciliation requirements. Failing the reconciliation test creates underpayment liability, which has produced several high-profile cases.

Superannuation is calculated on ordinary time earnings and is capped at a quarterly maximum contribution base, which limits employer cost for high earners.

Payday Super took effect on 1 July 2026 and changed three things at once. Contributions must now reach the employee’s fund within seven business days of each payday rather than quarterly. The base widened from ordinary time earnings to qualifying earnings, capturing all commissions and salary sacrifice amounts. And the maximum contribution base moved from a quarterly to an annual calculation. AUD 270,830 for 2026–27. That last change has a consequence worth planning around: a high earner now reaches the annual cap partway through the year and attracts no further super at all for the rest of it, with bonuses and commissions pulling that date forward. Employers can no longer spread superannuation evenly across twelve months, which disrupts total fixed remuneration and total employment cost structures. Note also that the 12% rate is final, there is no legislated rise to 12.5%, and sources suggesting otherwise are working from a superseded schedule.

Four representative profiles, costed with the 2026 contribution rates above. Salaries are illustrative market midpoints, not GX operating data, use them to see how the on-cost percentage behaves as pay rises, not as a salary benchmark for a specific role. Superannuation Guarantee at 12% to the A$270,830 annual contribution base. State payroll tax applies above each state threshold and is not included. Only superannuation is shown; state payroll tax applies above each state threshold. For real market data on your roles, ask for a costing.

Benchmarks pending GX Australia payroll data. Any benchmark should state whether the employer is above the relevant state payroll tax threshold, since that changes total cost by roughly five percentage points.

Non-residents are taxed from the first dollar at a higher starting rate and do not pay the Medicare levy. Working holiday makers have their own separate schedule. Getting residency status right at onboarding matters more in Australia than in most markets because the difference in withholding is substantial.

Employees with study loans have additional compulsory repayments withheld through payroll, which is a common source of confusion on a first payslip.

Employment is indefinite by default and the National Employment Standards apply regardless of what the contract says. A Fair Work Information Statement must be given to every new employee, and the applicable modern award or enterprise agreement overrides less favourable contractual terms.

Probation is contractual, commonly three to six months. The figure that governs is the minimum employment period for unfair dismissal, six months, or twelve in a small business. A probation period longer or shorter than that does not change it.

Award-covered employees typically receive time and a half for the first two or three hours of overtime and double time thereafter, plus penalty rates for evenings, weekends and public holidays. Salaried employees can be paid an annualised salary that absorbs these, but only if the arrangement satisfies a better-off-overall test and is reconciled periodically.

From 1 July 2026 new rules protecting penalty and overtime rates came into full effect, restricting arrangements that reduce them. Review any annualised salary arrangement against the current position.

Under the National Employment Standards, full-time employees receive four weeks of paid annual leave, which is 20 days. Certain shift workers receive five weeks.

Leave accrues progressively across the year and rolls over, it does not lapse, and accrued but untaken leave is paid out on termination.

Many awards and enterprise agreements add annual leave loading, commonly 17.5%, paid on top of ordinary wages when leave is taken. Check the applicable award, because it is a real cost that sits outside the headline salary.

Part-time employees accrue on the same basis pro rata. Public holidays are additional and vary by state and territory.

Australia has national public holidays plus additional days set by each state and territory, so the total differs by location. Victoria observes days that New South Wales does not, and vice versa. The King’s Birthday falls on different dates in different states. Confirm the applicable state calendar before publishing.

Superannuation is the principal statutory benefit, with employer contributions at 12% of ordinary time earnings paid into the employee’s chosen fund. Medicare provides universal healthcare funded through the tax system, so private medical cover is an enhancement rather than a necessity.

The National Employment Standards provide four weeks’ annual leave, ten days’ paid personal and carer’s leave, parental leave and long service leave, the last accruing under state legislation and often overlooked by foreign employers because it has no equivalent elsewhere.

Common enhancements include salary packaging arrangements, additional superannuation, private health cover and flexible work. Novated car leases are widely used and tax-effective.

Paid parental leave is available through the government scheme, and many employers top it up. This has become a significant competitive differentiator in professional hiring.

Employees over 45 who have completed at least two years of service when they receive notice get an additional week. An award, enterprise agreement or contract may set a longer period, and the longer period governs.

Payment in lieu is at the employee’s full pay rate, which includes incentive payments and bonuses, loadings, monetary allowances, and overtime or penalty rates. Redundancy pay, by contrast, is calculated at the base rate and excludes all of those. The two use different bases, which is a frequent calculation error.

Redundancy pay

Redundancy pay falls from 16 weeks to 12 at ten years of service. Fair Work states this is consistent with the 2004 Redundancy Case decision of the Australian Industrial Relations Commission. It is a genuine step down, not a typographical oddity.

Small business employers with fewer than fifteen employees are generally exempt from redundancy pay, counting associated entities as one entity and including the employees being dismissed. Regular and systematic casuals count toward the fifteen.

Accrued annual leave and long service leave must be paid out on termination. Where a business becomes insolvent, the Fair Entitlements Guarantee covers unpaid wages, leave, up to five weeks of pay in lieu of notice and up to four weeks of redundancy pay per year of service, but it does not cover superannuation or bonuses.

Sponsorship approval, nomination and the visa application are three separate stages, and the Skilling Australians Fund levy is a significant per-employee cost paid upfront by the employer rather than the applicant. Employers must also meet labour market testing requirements unless an exemption applies.

Independent skilled migration and working holiday visas exist and carry no employer obligation, which is often the faster route where the candidate already holds one.

Australia has an extensive treaty network and the analysis usually turns on the dependent agent test. The Australian Taxation Office has also issued guidance on employees working remotely from Australia for foreign employers, which is directly relevant given how much of that arrangement exists.

The multi-factor test looks at control, ability to delegate, commercial risk, provision of tools and whether the person is operating a business of their own. An ABN and an invoice prove nothing on their own.

The superannuation point is the one that catches foreign employers most often: a contractor paid principally for personal labour is entitled to the 12% guarantee, and unpaid amounts attract the Superannuation Guarantee Charge with interest and an administration fee.

The Fair Work Information Statement must be given to every new employee before or as soon as practicable after they start. Casual employees receive an additional Casual Employment Information Statement.

Work backwards from the start date. For a local hire through an EOR, 1 to 2 weeks is realistic once identity documents, bank details and the signed contract are in hand. For a foreign national requiring a permit, add the immigration timeline set out above before promising a date.

Confirm three things before making an offer: that the candidate has the right to work in Australia; that the salary clears any statutory or sector minimum that applies to the role; and whether the work involves concluding contracts locally, which can create a taxable presence for the client entity.

Collect the statutory registrations early. Social security enrolment, tax registration and any mandatory insurance generally must be in place before the first payroll runs, not after it.