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Hire Employees in Australia
  • By Travis Kliever
  • Updated March 2, 2024
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Travis Kliever
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Travis is a global business development advisor. He has spent the last 14 years supporting business establishment and development in North America, Southeast Asia, and throughout the world. With multiple degrees from the University of Oregon, Travis currently splits his time between the US, and Bali, Indonesia. At RemotePad, Travis writes about remote work, hiring internationally and PEO/EOR business models.
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Hire Employees in Australia

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When hiring in Australia, understand workplace laws, minimum wage, superannuation (retirement savings), taxes, and mandatory employee entitlements like leave. Ensure fair work practices and compliance with National Employment Standards (NES).

Key Takeaways

  • Understand Fair Work Act: Familiarize yourself with the Fair Work Act which governs employment in Australia.
  • Advertise the job: Advertise on popular Australian job websites, newspapers, or recruitment agencies.
  • Interview and select: Conduct interviews and select the best candidate.
  • Create a Fair Work Information Statement: This is required to be given to all new employees and outlines their conditions of employment.

Key Things to Know Before Hiring Employees in Australia

When hiring employees in Australia, it’s crucial to be aware of certain factors related to labor laws, cultural practices, and overall business etiquette. Here are some key things to know:

  1. Labor Laws: Vietnam has comprehensive labor laws, with stipulations on matters such as work hours, leave, minimum wage, social insurance, and labor contracts. For instance, the standard work week should not exceed 48 hours, and overtime is limited. The minimum wage varies by region, and social insurance contributions are obligatory for both employer and employee.
  2. Employment Contracts: These are mandatory in Vietnam. They can be indefinite or for a fixed term, with a maximum duration of 36 months for the latter. The contract should detail salary, working hours, job description, and termination conditions, among other things.
  3. Social Insurance: Both the employer and employee must contribute to Vietnam’s social insurance fund. The employer’s contribution is significantly larger. This fund covers sickness, maternity, work-related accidents, retirement, and death.
  4. Probation Period: The maximum probation period is 60 days for jobs requiring professional qualifications, and 30 days for most other jobs.
  5. Termination: Ending an employment relationship can be complex. There are strict regulations on notice periods, severance pay, and reasons for dismissal. It’s essential to understand these rules to avoid potential legal issues.
  6. Work Permits for Foreigners: If you’re hiring non-Vietnamese employees, they typically need to obtain a work permit before starting. There are exceptions for certain categories, such as internal transfers within a company, but this is generally the rule.
  7. Cultural Considerations: Vietnamese culture values respect and humility. In a work setting, it’s important to show respect to senior employees and to maintain harmony in the workplace. Communication can often be indirect, and preserving face is important. Also, relationships are highly valued, and networking can play a significant role in business.
  8. Language: While English is increasingly common, particularly among younger Vietnamese and in major cities, not all employees may be fluent. You may need to consider language training or hiring bilingual staff.
  9. Recruitment: Online job portals, recruitment agencies, and job fairs are popular recruitment channels. Universities also often have career centers where companies can post job offers.
  10. Training and Development: Employees in Vietnam often value opportunities for personal development and career advancement. Providing training programs can be a good strategy to attract and retain talent.

Remember, these are general guidelines and specifics can vary depending on the particularities of your business and the sector in which you operate. It’s always a good idea to consult with local HR professionals or legal counsel to ensure full compliance with Vietnamese law and best practices.

What are the key Things to Know Before Hiring employees in Australia

Hiring employees in Australia involves understanding and abiding by the country’s employment laws and regulations. Here are some key aspects to consider:

  1. Fair Work Act 2009: This is the primary piece of legislation governing Australia’s workplace relations system. It covers topics such as minimum wages, unfair dismissal, industrial action, enterprise bargaining, and more.
  2. National Employment Standards (NES): These are the minimum standards that apply to employment in Australia. They cover issues like hours of work, leave entitlements (annual leave, personal/carers leave, parental leave, etc.), notice of termination and redundancy pay.
  3. Awards and Agreements: Many employees are covered by an ‘award’, which sets out the minimum terms and conditions of employment on top of the NES, specific to certain industries or occupations. Some employees may also be covered by registered agreements (like enterprise agreements or other registered agreements) that can set employment conditions.
  4. Superannuation: Employers are generally required to contribute to an employee’s superannuation (retirement savings) if they are 18 years old or over and paid $450 or more (before tax) in a month.
  5. Tax File Numbers (TFN) and Australian Business Numbers (ABN): As an employer, you will need to collect your employees’ Tax File Numbers to withhold income tax on their behalf. If you are hiring a contractor, they may provide you with an Australian Business Number.
  6. Fair Work Information Statement: Every new employee should receive this statement, which provides information about the NES, rights of employees, the role of the Fair Work Ombudsman, and other employment-related information.
  7. Work Health and Safety Laws: You are obliged to provide a safe working environment for your employees, and you should understand your obligations under Australia’s Work Health and Safety laws.
  8. Visa Status: If you’re hiring someone from overseas, you need to check their work rights in Australia. The Department of Home Affairs has a Visa Entitlement Verification Online system to do this.
  9. Discrimination Laws: Australia has stringent laws against discrimination in the workplace. Employers can’t discriminate on the grounds of race, color, sex, sexual orientation, age, physical or mental disability, marital status, family or carer’s responsibilities, pregnancy, religion, political opinion, national extraction, or social origin.
  10. Insurance: Workers’ compensation insurance is mandatory in Australia. This insurance helps to protect your business and your people.

Remember to get legal advice if you’re unsure about any of your obligations as an employer. It’s essential to stay compliant with the law and provide a fair and safe workplace for your employees.

How much does it cost to hire employees in Australia?

The cost of hiring an employee in Australia can vary significantly depending on several factors such as the role, industry, location, experience level, and whether the position is full-time, part-time, or casual. Here are some of the key cost elements:

  1. Wages or Salary: This is the most significant cost associated with hiring an employee. The Fair Work Commission sets minimum wage rates, which as of my last update in September 2021, was AUD 20.33 per hour or AUD 772.60 per 38-hour week (before tax) for a full-time employee. However, many jobs will pay more than this minimum rate, and salaries can vary significantly depending on the factors mentioned above.
  2. Superannuation: Employers are required to contribute to their employees’ superannuation funds. As of 2021, this is 10% of an employee’s ordinary time earnings (which is set to increase gradually to 12% by 2025).
  3. Taxes: Employers are responsible for withholding income tax from their employees’ wages and sending it to the Australian Taxation Office (ATO).
  4. Insurance: Workers’ compensation insurance is mandatory and the cost can vary depending on the industry and type of work.
  5. Recruitment Costs: This could include advertising costs, recruitment agency fees, time spent interviewing, and onboarding costs.
  6. Training and Development: There may also be costs associated with training new employees, either through internal programs or external courses.
  7. Benefits and Perks: Some businesses offer additional benefits such as health insurance, gym memberships, or other perks, which can add to the overall cost.
  8. Office Space and Equipment: If the employee is working in an office, you will also need to account for the cost of office space, equipment, utilities, etc.

It’s also important to note that there can be additional costs associated with part-time or casual employees, who may receive higher hourly rates and additional benefits to compensate for the lack of job security and benefits such as sick leave and paid vacation time.

As a result, the cost of hiring an employee in Australia can vary widely, from the tens of thousands to the hundreds of thousands of dollars per year. It’s crucial to consider all of these potential costs when planning to hire.

What are the key ways to hire employees in Australia, such as PEO and EOR solutions?

When expanding a business in Australia or starting a new one, organizations have several options for hiring employees. Here are some of the key ways:

  1. Direct Hiring: This is the most traditional method, where you hire employees directly under your business entity. This requires you to manage all aspects of employment, including recruiting, hiring, payroll, tax compliance, benefits, and termination.
  2. Professional Employer Organization (PEO): A PEO provides comprehensive HR solutions for businesses. They co-employ your team, which means the PEO contractually shares certain employer responsibilities with the company. The PEO becomes the employer of record for tax purposes, filing payroll taxes under its own tax identification numbers. They can handle responsibilities like payroll, benefits, tax administration, and regulatory compliance, but the company maintains control over day-to-day operations and management of employees.
  3. Employer of Record (EOR): An EOR is similar to a PEO but typically has more comprehensive responsibilities for the employees. The EOR becomes the full legal employer, taking over all legal and compliance issues, managing HR, payroll, taxes, insurance, benefits, and more. EOR solutions are often used by companies expanding into a new country without setting up a legal entity there.
  4. Recruitment Agencies: These agencies can handle the recruitment and hiring process on your behalf. They can find, screen, and select candidates according to your requirements. Some recruitment agencies also offer additional services like payroll and HR management.
  5. Independent Contractors: Depending on the nature of the work, hiring independent contractors can be a flexible and cost-effective solution. However, it’s important to ensure that the working relationship meets the legal definition of a contractor to avoid potential legal and tax issues.
  6. Temporary Employment Agencies/Staffing Agencies: These agencies can provide temporary workers for specific roles or projects. They handle the recruitment, hiring, payroll, and other administrative tasks, and the workers are technically employed by the agency, not your business.
  7. Internships and Graduate Programs: For certain roles, it might be suitable to hire interns or recent graduates. Many Australian universities have programs to connect businesses with students or graduates looking for work experience or entry-level roles.

Remember, the best method for hiring employees in Australia will depend on your specific needs and circumstances. It’s always a good idea to get legal and financial advice before making a decision.

What are the steps businesses need to take to hire employees in Australia?

Hiring employees in Australia involves several key steps. Here’s a general outline of the process:

  1. Identify Your Needs: Determine the roles you need to fill, the skills and qualifications required, and whether the positions will be full-time, part-time, or casual.
  2. Create Job Descriptions: Write detailed job descriptions for each position, outlining the duties, responsibilities, required skills and qualifications, and any specific requirements related to the role.
  3. Advertise the Job: Post the job on job boards, your company’s website, social media, or use a recruitment agency. Make sure the job ad doesn’t discriminate on grounds such as age, race, religion, sex, etc.
  4. Collect and Review Applications: Collect resumes and cover letters from applicants. Review these documents to shortlist candidates for interviews based on their skills, experience, and fit for the role.
  5. Conduct Interviews: Interview shortlisted candidates to assess their suitability for the role. This could involve one or more rounds of interviews, and may also include skills tests or other assessments.
  6. Check References and Background: Contact the candidate’s references to verify their previous employment and performance. Depending on the role, you may also need to conduct additional background checks, such as police checks.
  7. Check Work Rights: If the candidate is not an Australian citizen, use the Visa Entitlement Verification Online (VEVO) system to check their work rights in Australia.
  8. Make a Job Offer: If you decide to hire a candidate, make a formal job offer. This should include details of the role, salary, benefits, and start date.
  9. Prepare an Employment Contract: Once the candidate accepts the offer, prepare a written employment contract. This should outline the terms and conditions of employment, including the employee’s duties, hours of work, salary, leave entitlements, termination conditions, and any other relevant details. The contract must comply with the National Employment Standards (NES) and any relevant modern awards or enterprise agreements.
  10. Set Up Payroll and Tax: Register for Pay As You Go (PAYG) withholding with the Australian Taxation Office (ATO) to withhold tax from the employee’s pay. Set up your payroll system to pay the employee on a regular basis.
  11. Arrange for Superannuation: Set up arrangements to pay superannuation contributions into the employee’s chosen super fund. As of 2021, this is 10% of an employee’s ordinary time earnings.
  12. Induct and Train the Employee: When the employee starts, provide induction training to familiarize them with your business and their role. This should include information about your workplace policies and procedures, health and safety practices, and any job-specific training they need.

Remember, this is a general guide and the exact process may vary depending on your specific circumstances and the nature of the role. Always seek legal advice if you’re unsure about any aspect of the hiring process.

FAQs

While not all employment relationships require a written contract under Australian law, it is strongly recommended. A written contract helps clarify the terms and conditions of employment for both the employer and the employee. It should include the nature of the employment (full-time, part-time, or casual), remuneration, working hours, leave entitlements, and other terms and conditions. Remember, the contract must comply with the National Employment Standards (NES) and any applicable modern awards or enterprise agreements.
  1. As of my last update in September 2021, the national minimum wage in Australia was AUD 20.33 per hour, or AUD 772.60 for a 38-hour week (before tax). However, a Fair Work Commission review takes place every year, which can lead to an increase in the minimum wage. Also, keep in mind that certain employees might be covered under modern awards or enterprise agreements, which can set higher minimum pay rates.
  1. As an employer, if you pay an employee AUD 450 or more before tax in a calendar month, you have to make superannuation contributions for that employee unless they are exempt. As of 2021, the superannuation guarantee is 10% of an employee's ordinary time earnings, and this rate is set to increase gradually to 12% by 2025. Contributions must be paid into a complying super fund and are generally due quarterly.

    Remember, it's always a good idea to get legal and financial advice if you're unsure about your obligations as an employer.

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