Australia, the smallest continent and one of the largest countries on Earth, lies between the Pacific and Indian oceans in the Southern Hemisphere. The Great Barrier Reef, off the east coast of Queensland, is the greatest mass of coral in the world and one of the world’s foremost tourist attractions.
Australia is divided into six states and two territories. Significant features of modern Australian society are isolation in the social landscape beyond the large coastal cities and the representation of a broad spectrum of cultures drawn from many lands due to immigration. Australia’s abundant and diverse natural resources attract high levels of foreign investment and include extensive reserves of coal, iron ore, copper, gold, natural gas, uranium, and renewable energy sources. The country also has a large services sector and is a significant exporter of natural resources, energy, and food.
*Please note that the official currency is the currency of remuneration when employed through WorkMotion in Australia.
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Capital :
Canberra
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Currency :
Australian Dollars (AUD, $, A$)
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Languages spoken :
English
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Population :
25.74 million (2021 est.)
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Minimum wage 2023 :
AUD 23.23 per hour
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Cost of Living index :
$$$$ (14 of 139 countries)
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Payroll Frequency :
Fortnightly/Monthly
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VAT - standard rate :
10%
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GDP - real growth rate :
1.5% (2021 est.)
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The Fair Work Act has specified eight public holidays. However, states or territories can add or replace more holidays. Public Holidays that fall on the weekend are observed on the following non-weekend day.
The national holidays mentioned below are valid for the year 2024.
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The approximate time for sharing the contract with an employee in Australia is 6 business days assuming no special requests or changes to our standard employment contract. Any such requests or changes would need to undergo internal and external review, directly leading to a time delay.
NOTE: This number is subject to change and is only an estimation of the Contract Sharing Time. The estimated Contract Sharing Time begins from the moment that WorkMotion has received all required information from both the client and the employee.
Employers must keep time and wages records for seven years. These need to be readily accessible to a Fair Work Inspector, legible, and in English.
There is only a 2% Medicare and 11% superannuation surcharge paid by the employers in the name of employee services. Unemployment and other statutory social services are not paid for.
Easter Saturday is observed only in the Australian Capital Territory, New South Wales, Northern Territory, South Australia, and Victoria
An employee can work a maximum of 38 hours a week unless the employer asks them to work reasonable extra hours.
Awards, enterprise agreements, and other registered agreements set out in any:
An employer can roster a full-time employee to average the employee’s hours over more than a week. This means the employee may work more than 38 hours a week, but less in another.
The overtime rate is different for each award, registered agreement, and contract. Employees should be aware of their overtime rate to ensure they are being paid correctly. An employee can refuse to work overtime if the request is unreasonable. Some employers allow employees to take paid time off instead of receiving overtime pay. This is known as ‘time in lieu’, ‘time off in lieu’, or ‘TOIL’.
Probation periods are often implemented at the start of the employment relationship. Employers can decide the length of the probation period, which can range from a few weeks to a few months. The common practice is between three to six months. During this period, full-time and part-time employees are entitled to accrue and access paid leave entitlements such as annual and sick leave. Employers must notify employees if they do not pass their probation.
The Fair Work Act 2009 refers to a Minimum Employment Period which is determined by the amount of time the employee has worked in the business and the size of the business. If the employee has met the minimum employment period, the employee has access to unfair dismissal which is the minimum period that an employee must be engaged for before they may have access to an unfair dismissal claim if their employment is terminated by the employer. For a small business with less than 15 employees, this is 12 months, otherwise, it is six months.
Depending on an employee’s service period, employers must give the following minimum statutory notice when dismissing the employee:
| Service Period | Length of Notice |
| Less than 1 year | 1-week notice |
| 1 to 3 years | 2 weeks notice |
| 3 to 5 years | 3 weeks notice |
| More than 5 years | 4 weeks notice |
An employee has to get an extra week of notice if they are over 45 years old and have worked for the employer for at least two years.
Notice amount can be paid out completely or in a combination of the notice period and payment. If the employer pays out the notice period, the employee’s employment ends on the date that payment in lieu of notice is made.
Under the NES (National Employment Standards), full-time and part-time employees are entitled to four weeks of paid annual leave (also known as holiday pay) and one additional week for eligible shift workers. Annual leave accumulates in hours and from the first day of employment, including the probation period. Unused annual leave rolls over from year to year and is paid out on the termination of employment.
Sick, personal or carer’s leave allow employees to take time off to deal with personal illness and family emergencies. This type of leave is funded by the employer.
Employees are entitled to up to 10 days of paid personal/carer’s leave for each year of employment and two days of unpaid carer’s leave per year. Different paid sick and carer leave entitlements can be set out in an award, registered agreement, or contract, but they cannot be less than the minimum.
Sick and carer’s leave accumulates in days and from the first day of employment. At the end of the year, the balance carries over to the next year.
Long Sick Leave
An employee can take as much paid sick leave as they have accumulated if they are not fit for work because they are sick or injured. To be protected from dismissal during a temporary absence from work:
Employees are able to take unpaid parental leave if they:
Employees are entitled to up to 12 months of unpaid parental leave. They can also request up to an additional 12 months of leave.
Eligible employees who are the primary carer of a newborn or a newly adopted child get up to 20 weeks’ PLP which is paid at the National Minimum Wage. Eligible employees can claim PLP for one set period and one flexible period.
Employer-paid Optional Parental Leave
Employers can provide paid parental leave in enterprise or other registered agreements, employment contracts, and workplace policies. The amount of leave and pay entitlements depends on the relevant agreement, contract or policy.
Eligible working dads and partners (including same-sex partners) also benefit from paid parental leave (up to 20 weeks), paid at the National Minimum Wage. These payments are made directly to the employee by the Australian Government.
Eligible employees who are the primary carer of a newly adopted child get up to 20 weeks of PLP, which is paid at the National Minimum Wage.
An employee who has received a notice of redundancy is allowed at least one paid day off per week of notice, to look for another job.
Under the NES (National Employment Standards), all employees, including casuals, have an entitlement to compassionate leave (also known as bereavement leave). Awards, enterprise agreements, and other registered agreements can also provide additional entitlements to compassionate leave.
Employees get long service leave after working at the same company for a long period of time. Long service leave laws differ for each state or territory.
Full-time and part-time employees have to be paid ‘make-up pay’ for the first 10 days of jury selection and jury duty. Make-up pay is the difference between any jury duty payment the employee receives (excluding any expense-related allowances) from the court and the employee’s base pay rate for the ordinary hours they would have worked. If the employee cannot provide evidence, they are not entitled to make-up pay.
There are no social security taxes in Australia. However, a levy is imposed on taxable income and reportable fringe benefits for residents for the funding of a National Health Scheme (Medicare). The Medicare levy is currently 2%. No levy is payable to those with taxable income below the relevant low-income thresholds.
A surcharge of between 1% and 1.5% applies to high-income taxpayers where the taxpayer and their dependents are not covered by a private health insurance fund registered in Australia that provides basic hospital cover.
Employers must contribute on behalf of their employees’ superannuation a set minimum percentage of the employee’s earnings base, subject to limited exceptions, or be liable to a superannuation guarantee charge. The required superannuation guarantee percentage is currently 11%.
Here is an overview of employer costs in Australia:
| Benefits | Employer Contribution |
|---|---|
| Superannuation | 11% |
| Payroll Tax* | up to 6.85% |
| Work Related Injury | It depends on the state |
*Payroll tax is a state or territory tax calculated based on total wages paid each month.
The National Health Scheme (Medicare) is funded through a Medicare levy that is currently 2%. Both employers and foreign nationals working in Australia should take care in choosing a health fund that both qualify for the exemption from the Medicare levy surcharge and provides adequate cover because it is possible to have a policy that provides full coverage but does not also exempt the policyholder (and their family members) from the surcharge and vice versa.
To meet their legal and operational duties, schemes can be:
Workers’ compensation is governed by individual Australian states and territories. Employers in each state or territory have to take out workers’ compensation insurance to cover themselves and their employees.
There are no employer contributions to unemployment benefits.
The pension system in Australia comprises old-age pension, person pension, public pension, and others. Employers must contribute on behalf of their employees’ superannuation a set minimum percentage of the employee’s earnings base, subject to limited exceptions, or be liable to a superannuation guarantee charge. The required superannuation guarantee percentage is currently 11%. This will progressively increase up to 12% in 2025.
Under the First Home Super Saver Scheme (FHSS), an individual can apply to release voluntary superannuation contributions, along with associated earnings, to help purchase their first home, subject to meeting certain eligibility requirements. Concessional tax treatment applies to amounts withdrawn under the scheme. Employers’ contributions do not count towards FHSS, however, employees can enter into a salary sacrifice arrangement with their employer to deduct their contributions from salary and pay them into the scheme.
The information contained in this Country Guide is provided for informational purposes only and should not be construed as legal advice on any subject matter. The contents of this Country Guide contain general information and may not reflect current legal developments or address your situation. You should not act or refrain from acting on the basis of any content included in this Country Guide without seeking the advice or representation of a licensed attorney. WorkMotion Software GmbH disclaims all liability for actions you take or fail to take based on any content included in this Country Guide.
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