Australia
Australia’s a great place to hire remote talent, and at Thera, we should know: We’ve hired there before! So, if you’ve found someone you’d like to hire remotely in Australia, you’re in the right place. In the next few minutes, we’ll teach you how to hire in Australia (without getting yourself wrapped up in thousands of dollars of legal red tape).
Country snapshot
CURRENCY
Australian Dollar (AUD)
EMPLOYER TAXES
15.85%
PAYROLL FREQUENCY
Bi-Monthly/Monthly
OFFICIAL LANGUAGE
English
It’s the fastest way to hire globally
Hiring employees takes months, at the minimum. When you hire with Thera's locally-generated contracts, it’s a matter of days or weeks. This means you can hire the best talent, fast, without losing them to a hellish procession of paperwork.
It’s a lot cheaper
It costs just $0 to sign up for Thera, then $25 per month to hire your contractors with Thera. If you hired employees manually (or did contracting on your own), you’d likely be on the hook for thousands of dollars each month. Setting up an entity alone can cost tens of thousands of dollars.
It’s more flexible for you & your team
Can be less risky than hiring employees
Hiring employees is a bigger commitment, and can open you up to increased liabilities and regulations. When you hire contractors overseas, your biggest risk is misclassification—but laws surrounding contractor classification are often significantly more straightforward.
Some people want to be employees
The contractor life isn’t for everyone—some people want the security that being an employee often appears to provide. Though it’s rare, this does happen, and it’s one disadvantage of manage an all-contractor team.
You might not have as much control over your talent
Most countries’ contractor-employer relationship laws stipulate that the employer can’t set fixed working hours, among other things. These laws give contractors more freedom over how and when they do their work than an employee would have. In reality, however, most contractors are willing & able to work on the company’s schedule—it’s a matter of setting expectations beforehand.
No matter where you’re based out of, we can tell you one thing: Australia has different labor laws than your home country (unless your home country is Australia, that is). If you don’t do things right, you’ll be putting your company at the risk of fines—and risk losing the talent you brought onboard. Fortunately, doing things right is pretty easy if you take the right route.
Hire talent as contractors
Hire talent as employees
If you’ve read up until this point, you’ll know that it’s easier, cheaper, and more flexible to hire contractors in Australia than employees. Still, there are valid reasons why you might want to hire employees instead. The content below is for you—we’ll cover employer taxes and obligations in Australia
Employer tax
Payroll Tax
Medicare
Superannuation (capped at 21,002.06 AUD per year)
Paid Time Off (PTO)
Full-time employees are entitled to 4 weeks of paid leave per year, while employees who work in shifts receive 5 weeks.
Public Holidays
Public holidays vary by state.
Sick Days
Employees are entitled to 10 days paid leave per year which can be used if the employee is sick or if they need to care for a family member.
Maternity Leave
Pregnant employees receive 4 months of paid maternity leave; 1 month of prenatal leave and 3 months of postpartum leave. 50% of the payments are paid by the employer and the other 50% is paid by the CCSS (Costa Rican Social Security Fund).
Paternity Leave
Fathers are entitled to 5 days unpaid leave at the time of the birth or adoption of a child.
Parental Leave
Parental leave is an unpaid leave that lasts for 12 months, and it is possible to request an additional 12 months from the employer.
Other Leave
None.
Marriage Leave
None.
Bereavement Leave
In Australis, employees are entitled to have 2 days paid leave.
Termination Process
Reason for termination varies based on the number of employees an employee has and the length and type of service:
- 15 employees
Length of Employment: Up to 6 months
Type of employees: Permanent
Reasons for terminations: No specific reason is needed - Over 15 employees:
Length of Employment: 6 months+
Type of employees: Permanent
Reasons for terminations: A valid reason is needed - 15 employees or less:
Length of Employment: Up to 12 months
Type of employees: Permanent
Reasons for terminations: No specific reason is needed - 15 employees or less or less
Length of Employment: 12 months +
Type of employees: Permanent
Reasons for terminations: A valid reason is needed - Casual employees:
Length of Employment: N/A
Type of employees: Casual
Reasons for terminations: Once employed for 12+ months, there must be a valid reason
Employees dismissed in the first 6 months of employment (or 12 months of employment if employed by a small business) cannot make a claim of “unfair dismissal” to the Fair Work Commission. However, there are some exceptions to this known as General Protections matters where there is no minimum engagement period applying.
Unfair dismissal applications are heard in the Fair Work Commission – a specialist employment tribunal.
Notice Period
The notice period is determined by the amount of time the employee has been employed:
- Less than 1 year of employment: 1 weeks’ notice
- 1-3 years of employment: 2 weeks’ notice
- 3-5 years of employment: 3 weeks’ notice
- 5+ years of employment: 4 weeks’
If the employee is over the age of 45 and has been employed for at least 2 years, they are entitled to an additional week of notice.
Severance Pay
Severance pay is given based on a continuous period of service, and the pay rate is given for ordinary hours worked:
- At least 1 year but less than 2 years: 4 weeks’ severance pay
- At least 2 years but less than 3 years: 6 weeks’ severance pay
- At least 3 years but less than 4 years: 7 weeks’ severance pay
- At least 4 years but less than 5 years: 8 weeks’ severance pay
- At least 5 years but less than 6 years: 10 weeks’ severance pay
- At least 6 years but less than 7 years: 11 weeks’ severance pay
- At least 7 years but less than 8 years: 13 weeks’ severance pay
- At least 8 years but less than 9 years: 14 weeks’ severance pay
- At least 9 years but less than 10 years: 16 weeks’ severance pay
- At least 10 years: 12 weeks’ severance pay
Probation Period
The probation period is 6 months, however, if an employer has 15 employees, it is extended to 12 months. In addition, employers are able to shorten the minimum probation period. In doing so, however, the employer forgoes the benefits of a probation period.
Working Hours
The standard workweek is 38 hours.
Overtime
Minimum employment conditions are outlined in the Fair Work Act, 2009 and Industrial Awards. Awards are either industry-based or occupation-based.
Employees covered by Awards are generally paid overtime. Most Awards provide for overtime to be paid for time worked in excess of 38 hours per week, or in excess of 10 hours per day. Overtime or a penalty is generally paid to Award based employees for work performed on a weekend or a public holiday.
If an employee is not an Award employee, they are considered to be “Award Free.” Award Free employees do not have a statutory right to be paid overtime.
However, such employees do have the right to work only 38 plus reasonable additional hours per week. There is no formal definition of what is “reasonable additional hours,” however, such employees are generally expected to work overtime hours that are necessary to complete the job they are employed to do.
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