Superannuation is 11.5% on top of every salary in 2025–26, rising to 12% from July 2025. That’s your first employer cost to budget. The second: Australia’s Fair Work Act and modern award system create a compliance floor that’s more prescriptive than most employers expect — minimum pay rates, penalty rates for weekends and public holidays, and mandatory notice periods that increase with tenure. Miss any of it and Fair Work can pursue penalties up to A$93,900 per contravention for a company.
Australia Employment at a Glance
| Detail | Value |
|---|---|
| Currency | Australian Dollar (AUD) |
| Official language | English |
| Employment law | Fair Work Act 2009, National Employment Standards (NES) |
| Payroll frequency | Monthly, fortnightly, or weekly (varies by award) |
| Social security | Superannuation |
| Tax authority | Australian Taxation Office (ATO) |
| Minimum wage | A$24.10/hour (A$915.90/week, as of July 2024) |
| Standard working hours | 38 hours/week |
| Annual leave (minimum) | 20 days (4 weeks) per year |
| Public holidays | 8 national + state-specific |
Superannuation: What Your EOR Handles
Superannuation is mandatory for all employees earning A$450+ per month (threshold removed from July 2022 — it now applies to all ordinary earnings).
| Obligation | Rate (2025–26) |
|---|---|
| Superannuation Guarantee (employer) | 11.5% of ordinary time earnings |
| Superannuation Guarantee (from July 2025) | 12% |
Your EOR remits super to the employee’s nominated super fund quarterly. Late payment triggers the Superannuation Guarantee Charge (SGC) — the contribution amount plus interest and an administration fee. The ATO enforces this aggressively.
Fair Work Act and Modern Awards
The Fair Work Act sets 11 National Employment Standards (NES) that apply to all employees. On top of NES, most employees are covered by a modern award — an industry-specific instrument that sets minimum pay rates, allowances, penalty rates, and overtime.
There are 121 modern awards. Your EOR must identify the correct award for each hire. Getting the award wrong means getting the minimum pay rate wrong, which is an underpayment — and Fair Work has pursued high-profile cases on this.
Key NES entitlements
- Annual leave: 4 weeks (5 weeks for shift workers)
- Personal/carer’s leave: 10 days per year
- Compassionate leave: 2 days per occasion
- Parental leave: 12 months unpaid (plus government-funded Paid Parental Leave of up to 20 weeks)
- Long service leave: Varies by state, typically 8.67 weeks after 10 years
- Notice of termination: 1–4 weeks depending on tenure (5 weeks if over 45 and 2+ years’ service)
- Redundancy pay: 4–16 weeks depending on tenure
Penalty rates and overtime
Modern awards prescribe penalty rates for work on weekends, public holidays, and outside ordinary hours. These can be substantial:
- Saturday: 125–150% of base rate
- Sunday: 150–200%
- Public holidays: 200–250%
If your hire works flexible hours or weekends, confirm which award applies and what the loaded rate is before you set compensation.
Payroll Tax
Payroll tax is a state-level tax on employer wage bills. Each state has different thresholds and rates:
| State/Territory | Rate | Monthly Threshold (approx.) |
|---|---|---|
| NSW | 5.45% | A$1.2M annual |
| VIC | 4.85% | A$900K annual |
| QLD | 4.75% | A$1.3M annual |
| WA | 5.5% | A$1M annual |
| SA | 4.95% | A$1.5M annual |
Your EOR’s entity bears this obligation. For small teams (under 5–10 employees), the EOR’s total payroll may fall below the threshold — but don’t assume. Confirm with your EOR whether payroll tax applies to your hires.
Tax Obligations
Australia uses PAYG (Pay-As-You-Go) withholding:
| Taxable Income (AUD) | Rate |
|---|---|
| 0–18,200 | 0% |
| 18,201–45,000 | 16% |
| 45,001–135,000 | 30% |
| 135,001–190,000 | 37% |
| Above 190,000 | 45% |
Plus the Medicare Levy of 2% on taxable income. Non-residents are taxed from the first dollar at higher rates and don’t receive the tax-free threshold.
How Long Does EOR Onboarding Take in Australia?
- Australian citizen/PR: 2–5 business days
- Working holiday visa (subclass 417/462): 2–5 business days
- Employer-sponsored visa (subclass 482): 2–6 months (visa processing)
For candidates already in Australia with work rights, onboarding is fast. Sponsoring a visa adds months — and your EOR must be an approved Standard Business Sponsor (SBS) to lodge visa nominations.
Top EOR Providers for Australia
- Rippling — Full EOR support for Australia. Good fit for teams already on Rippling for US HR.
- Deel — Owned entity in Australia. Fastest onboarding for candidates with existing work rights.
- Remote — Owned entity. Strong compliance tooling.
- G-P — Owned entity with deep compliance infrastructure.
See provider reviews for detailed comparisons.
Frequently Asked Questions About EOR in Australia
What modern award applies to my software engineer hire? Most likely the Professional Employees Award 2020 if they’re a graduate professional, or they may be award-free if they earn above the high-income threshold (A$175,000 in 2024–25). Award-free employees are still covered by NES. Your EOR should classify the role and confirm.
Can I terminate an employee in Australia without cause? Employees with 6+ months’ service (12 months for small businesses) are protected from unfair dismissal under the Fair Work Act. You need a valid reason related to capacity or conduct, and must follow a fair process. Redundancy is permissible but carries mandatory severance (4–16 weeks depending on tenure).
Is long service leave mandatory? Yes, but it’s governed by state legislation, not federal. In most states, an employee accrues long service leave after 7–10 years of continuous service. The rate is typically 8.67 weeks after 10 years. Pro-rata entitlements may apply on termination after 5–7 years in some states.
What’s the real cost of hiring someone at A$120,000/year through an EOR? Base salary: A$120,000. Superannuation (11.5%): A$13,800. Payroll tax (if applicable, ~5%): A$6,000. Workers’ compensation insurance: varies by state and role. EOR fee: roughly US$599/month (A$900). All-in roughly A$145,000–150,000 before leave loading and any award allowances.
Does my EOR need to be an approved visa sponsor? Yes, if you’re hiring a foreign national who needs a work visa (subclass 482 or similar). The EOR must be registered as a Standard Business Sponsor with the Department of Home Affairs. Confirm this before you proceed — not all EORs maintain active sponsorship.
