Australia 🇦🇺
Congratulations on your decision to hire employees in Australia! Known for its dynamic, diverse, and skilled workforce, Australia is a compelling destination for businesses seeking to establish or expand their presence in the Asia-Pacific region. With a robust, stable economy, Australia provides a supportive backdrop for growth and innovation. Plane simplifies the hiring process for you by offering automated tax document collection, payroll, benefits administration, and more, while ensuring compliance and maximum efficiency. Still, hiring in a new country can pose certain challenges, so we’ve put together the following guide on how to navigate the process of hiring in Australia.
Currency
AUD
Onboarding
2.5 weeks minimum
Employer Cost
21.5%
Pay Frequency
Monthly
Public Holidays
7
5 Considerations Before Hiring in Australia
As an employer in Australia, it is important to have a comprehensive employment contract that outlines the terms and conditions of the employment relationship. The contract should include need-to-know info on compensation, benefits, vacation time, and sick leave policies. Before onboarding a new employee in Australia, take a moment to consider the following questions:
Getting Started with Hiring in Australia
Employment Contract
In Australia, employment contracts are crucial for defining the terms and conditions of employment between an employer and an employee. By law, these contracts can be verbal or written, but written contracts are highly recommended for clarity and legal certainty. Employment contracts must comply with the National Employment Standards (NES) and any relevant awards or enterprise agreements. They typically fall into several categories:
- Full-time contracts: For employees who work, on average, 38 hours per week. They are entitled to all NES protections and benefits, including annual leave, sick leave, and family and domestic violence leave.
- Part-time contracts: For employees who work regular hours each week, but less than 38 hours. They receive annual leave and sick and carer’s leave on a pro-rated basis, as well as 10 days’ paid family and domestic violence leave.
- Casual contracts: For employees who work irregular, non-guaranteed hours. Under awards and agreements, casual employees typically receive a casual loading, or a higher pay rate, in exchange for not receiving paid annual leave. Under the NES, casual employees are still entitled to a chance to become permanent employees, as well as two days’ unpaid carer’s leave, two days’ compassionate leave, paid family and domestic violence leave, and unpaid community service leave.
- Fixed-term contracts: For full-time or part-time employees contracted to work for a specific duration with an agreed-upon end date. Fixed-term employees are entitled to the same wages, penalties, and leave as permanent employees. As of December 1, 2023, these contracts cannot last longer than two years, including extensions and renewals, and can’t be extended or renewed more than once.
- The employer and employee’s names and addresses
- The job title, duties, and responsibilities
- Where work is performed (and specify if the employer or employee determines this)
- The employee’s usual working hours (per day or per week) and any expectations of overtime
- Salary or wage details, including amount, payment periods, and superannuation contributions
- Vacation and leave entitlements
- The length and conditions of the probation period, if applicable
- Duration of the contract, if fixed-term
- Terms related to ending the employment contract (i.e. termination)
- Reference to applicable award or enterprise agreement employment terms, and
- Any other terms and conditions agreed to between the parties.
Payroll Timelines and Dates
Pay Frequency: Employee payroll is monthly, with 12 pay periods per year. Pay is distributed on the last business day of the month.Payroll Change Cutoff Dates: To meet payroll deadlines, any changes must be submitted to support@plane.com by the cutoff date. For Australia, the payroll change cutoff date is on the last business day of the previous month. For example, changes to June payroll would need to be received no later than May 31, if May 31 is a business day.Plane sends payroll summaries to admins at the end of the second week of the month. After that, charges are automatically debited. Payroll summaries are also available to admins in their Plane accounts. Payday may vary based on country requirements.
Working Hours
The typical workweek for a full-time employee is 38 hours over five days, or 40 hours a week with a half day (four hours) every other week, usually on a Friday. Full-time employees can work up to 38 hours per week. Part-time employees work the lesser of 38 hours per week or the employee’s ordinary work hours per week. As with most employment standards, employees covered under awards or enterprise agreements may be allowed to work more or fewer maximum hours per week.Work performed outside of an employee’s ordinary hours of work or in excess of their normal number of hours is considered overtime. Employers may request employees to work reasonable overtime hours, with a lengthy list of factors determining whether those hours are reasonable, including the employee’s role, personal circumstances, the needs of the workplace, and more. Employees may refuse unreasonable overtime requests. Awards and enterprise agreements often allow work hours to be averaged over a period of time so that employees may work more than 38 hours per week, as long as the average over the period does not exceed 38 hours. Without an award or agreement, employers and employees are free to agree to an averaging arrangement with a maximum averaging period of 26 weeks, but employers cannot force employees to accept this.Time tracking is not required by law in Australia, but we recommend asking your employees to track their time if possible to document that they’re not working more than 38 hours per week.
Public Holidays
Australia has seven national public holidays:
- New Year's Day
- Australia Day
- Good Friday
- Easter Monday
- Anzac Day
- Christmas Day
- Boxing Day
Compensation
You can use Plane's Remote Compensation Tool to check remote salary data in Australia by job title.As of July 1, 2023, the minimum wage in Australia is $23.23 per hour or $882.80 per week. However, employees covered by an award or enterprise agreement may be entitled to higher minimum pay rates and compensation.
Health Insurance Benefits
Australia’s robust public healthcare system, known as Medicare, grants all Australian citizens and permanent residents access to free or low-cost healthcare. Medicare is funded by taxpayers, and covers a significant portion of healthcare costs — though not all of them. Some individuals may choose to get private health insurance to cover services that Medicare doesn’t fully cover.While not mandatory, some employers in Australia choose to offer private health insurance as part of their employee benefits package. Plane helps employers offer supplemental healthcare as a competitive benefit to attract and retain talent.
Sick Leave
According to the NES, full-time employees are entitled to 10 days of paid sick and carer’s leave, per year. Part-time employees are entitled to a proportional amount based on their regular hours of work. Sick leave accumulates year after year if unused, but is not paid out when an employee leaves the company. Employees can use sick leave if they are ill, injured, or unfit for work, or need to be absent from work to care for an immediate family or household member who requires support. Casual employees are not entitled to paid sick leave, but are protected from being dismissed due to illness or injury. Employers may ask employees to provide reasonable evidence to justify their use of sick leave. Employees who can provide this evidence of illness or injury are protected from dismissal due to their absence if they’re away for less than three consecutive months or three months in total over the last 12 months, or still using their paid sick leave. Employees who have taken more than three months of sick leave and used up all of their paid sick leave aren’t protected from being dismissed.Some awards, enterprise agreements, or employment contracts may entitle employees to more sick leave than is covered by the NES.
Vacation Leave
Full-time employees are entitled to a minimum of four weeks of paid annual leave each year. Part-time employees are entitled to the same amount of leave, but on a prorated basis depending on their ordinary hours of work.An employee starts to accrue annual leave on their first day of work, even if an employee is in a probation period. Annual leave accrues gradually over the year according to the employee’s ordinary hours of work and carries over from year to year if not taken. In some cases, though, an employee may be asked to take leave if they’ve accrued an excessive amount.Employees must request to take annual leave before going on leave. Employers can only reject an employee’s request to take annual leave if the refusal is reasonable.There are no rules on the minimum or maximum amount of annual leave that an employee may take at once, as long as the employer and employee agree on the amount of time taken.Under some awards or enterprise agreements, employees may be entitled to cash out their annual leave at their normal pay rate, as long as they retain at least four weeks in their leave balance. For employees not covered by awards or agreements, employers may offer to set up a similar agreement in writing.
Long Service Leave
Long service leave is a unique type of leave available to employees in Australia, designed to reward employees for working for the same employer for a long period of time. The exact period for eligibility and entitlements available vary across states and territories.
Compassionate and Bereavement Leave
Compassionate and bereavement leave is for employees to take time off work in the event:
- A member of their immediate family or household dies, or contracts a life-threatening illness or injury
- A baby in their immediate family or household is stillborn
- They have a miscarriage, or
- Their current spouse or partner has a miscarriage
Family and Domestic Violence Leave
All employees — full-time, part-time, and casual — are entitled to 10 days of paid family and domestic violence leave per year, if needed. Employee may access this leave immediately from their first day of work. This leave balance renews on an employee’s work anniversary, but doesn’t accumulate from year to year. Family and domestic violence leave is considered separate from other types of leave, such as annual leave or paid sick and carer’s leave.This leave helps employees affected by family and domestic violence in dealing with violent or abusive situations. Employers may ask for evidence that the leave is being taken for the stated purpose, but are required to treat any information disclosed confidentially.
Maternity / Paternity / Parental Leave
All employees in Australia are entitled to up to 12 months of unpaid parental leave after they or their spouse/partner gives birth, or they adopt a child under the age of 16. They can request an additional 12 months of unpaid leave after the initial first year. Parental leave is job-protected, meaning that employees have a right to return to their old job after their parental leave ends. Employees are eligible for parental leave if they’ve worked for their employer for at least 12 months before the expected date of birth, date of adoption, or when the leave starts — and if they have or will have responsibility for the care of a child. Casual employees are eligible for parental leave if they’ve been working for their employer on a regular basis for at least 12 months, and would reasonably expect to continue working on a regular basis for this employer otherwise.Employees who have taken parental leave aren’t required to work for another 12 months before taking another period of parental leave with that same employer. However, if they start work for a new employer, they will need to work for that employer for at least 12 months before becoming eligible to take parental leave.Employees who are taking parental leave to care for an adopted child are entitled to 2 days of unpaid pre-adoption leave for necessary interviews or examinations.
Employment / Termination
Termination of employment in Australia is regulated by the Fair Work Ombudsman and Fair Work Commission. Employers must adhere to the correct procedures for termination to avoid potential legal challenges and claims of unfair dismissal, including documenting all steps of the termination process. Plane employs the practice of Mutual Termination Agreements (MTAs) for involuntary offboarding, which enable employers to terminate employees while minimizing costs and the risk of litigation. This agreement covers unused leave, notice periods, severance, and negotiated terms, in exchange for the employee waiving their right to challenge the termination. It is important to note that Plane does not facilitate unilateral terminations or dismissals, due to risk of litigation that can expose employers to increased damages. Also, the grounds for these terminations may not be valid for an employer of record. We ask that you give us as much notice as possible and involve us right from the beginning of the process (i.e., at least 30 days before termination) so we can better support and guide you through the process. Involuntary termination can take time to negotiate with employees to mutually agree and end on good terms. You can find additional information here on how to terminate an employee.Notice Periods: Employers must provide written notice of the last day of employment for most employees, or provide pay in lieu of notice. Even if an employee is on probation, they are entitled to receive notice or pay in lieu of notice. The minimum amount of notice required ranges from one to five weeks, depending on the age of the employee, their employment type, and how long they’ve been continuously employed by the employer. Casual employees, fixed-term employees coming to the end of their contract, or employees fired due to serious misconduct are not entitled to receive notice of termination.On the employee side, employees must refer to their award, enterprise agreement, contract of employment, or workplace policy to find out how much notice they must give if resigning. This notice doesn’t necessarily need to be written.Final Pay: Upon termination, employees are entitled to receive final pay of all outstanding wages, payouts of any unused annual leave and long service leave, and payment in lieu of notice, if applicable. Redundancy Pay: Employees terminated due to their job becoming redundant may be entitled to redundancy pay, also known as severance pay, if they’ve worked for an employer for longer than one year. Redundancy pay is paid at a rate based on their period of continuous service, ranging from four to 16 weeks of pay. Unfair Dismissal: Unfair dismissal occurs when an employee is dismissed from their job in a harsh, unjust, or unreasonable manner. An employee may lodge an unfair dismissal claim to the Fair Work Commission if they believe their termination was unfair. For these reasons, it’s important for employers to keep a thorough record of termination proceedings, and any measures taken before termination, to prove that the dismissal was fair.
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Annual cost of employment*
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*rates for: December 11, 2024
Once you have sorted out the details mentioned above, you can add the employee to the Plane platform. We provide a step-by-step workflow that shows what tasks need to be completed, as well as real-time updates and notifications. This way, you can stay on top of the hiring process at all times. With Plane, you can confidently hire, knowing that you have a powerful platform at your disposal to manage the entire process from start to finish. Here are the instructions for adding a new employee to the platform:
How to hire and onboard an employee
Plane offers a guided process for administrators and managers to hire and onboard their new employees...
Learn moreHiring an employee in a new country can be a complex process, but with the right guidance and resources, it can be a smooth and successful transition. At Plane, we're committed to helping you navigate the process of hiring an employee in Australia. We'll keep you informed and up-to-date with the latest regulations and employment laws.Good luck with your new hire, and welcome to Australia!
Frequently Asked Questions
Here are the answers to some common questions about hiring employees in Australia with Plane:
Australian Employment Laws: An Easy Guide for US-Based Companies
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Leave Policy in Australia: An Easy Guide for US Companies
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