Summary Info: Hiring in Australia

Australia is a leading Asia-Pacific economy, known for its stability, innovation, and highly skilled workforce. With strong industries in finance, mining, technology, healthcare, education, and renewable energy, the country is a hub for regional headquarters and global companies looking to expand in the Asia-Pacific region.

Major cities such as Sydney, Melbourne, Brisbane, and Perth attract global investment and talent, with Sydney serving as a financial hub, Melbourne as a technology and education powerhouse, and Perth as a center for mining and energy.

Australia’s workforce is highly educated, with over 50% of 25–34-year-olds holding tertiary qualifications, supported by top institutions such as the University of Melbourne, Australian National University, and University of Sydney. English is the primary language of business, making integration smooth for global companies.

However, hiring in Australia comes with challenges. Employers must navigate strict labor laws under the Fair Work Act, high social contributions, industry-specific awards, and complex visa rules for foreign workers. Setting up a subsidiary also requires registration with the Australian Securities and Investments Commission (ASIC) and the Australian Taxation Office (ATO), which can delay hiring.

With Gloroots as your Employer of Record in Australia, you can hire top talent quickly and compliantly without establishing a local entity. We manage payroll, tax compliance, superannuation, and benefits while ensuring alignment with the Fair Work Act and industry awards.

Looking to hire in Australia? Contact us to streamline your expansion and hire compliantly within days.

What are the key facts about Australia’s economy and workforce?

Australia is the 13th-largest economy in the world and one of the most stable, with consistent GDP growth for nearly three decades before the pandemic. Its economy is diversified, with strengths in mining and natural resources, finance, education, healthcare, technology, and renewable energy. The country is also a key exporter of commodities like iron ore, coal, and natural gas, while simultaneously building world-class capabilities in clean energy and digital services.

Australia’s workforce of ~14 million is highly educated, urbanized, and English-speaking, making it one of the most accessible global labor markets. Universities such as the University of Melbourne, Australian National University, and University of Sydney consistently rank among the world’s top 50, producing strong graduates in STEM, business, and healthcare.

English is the sole business language, giving companies an advantage when managing cross-border operations. The workforce is also internationally diverse, reflecting Australia’s immigration-driven population.

Key employment hubs include:

• Sydney — finance, fintech, IT, and professional services.
• Melbourne — technology, education, healthcare, and creative industries.
• Brisbane — energy, mining, and infrastructure.
• Perth — natural resources and engineering.

Australia’s labor market is governed by the Fair Work Act, which enforces strict rules on wages, benefits, and employee protections. Employers must also comply with Modern Awards, which set industry-specific pay scales and entitlements.

Gloroots helps companies expand in Australia by ensuring compliance with these regulations through our Employer of Record services, enabling businesses to focus on growth instead of complex compliance.

What is the work culture and talent pool like in Australia?

Australia’s work culture combines professionalism with a strong emphasis on work-life balance. Employees value equality, open communication, and collaboration. While workplaces are generally structured, management hierarchies are less rigid compared to Europe or Asia, and employees are encouraged to share opinions openly.

Work Culture Traits

• Work-Life Balance — Australians place high importance on leisure and family time. Flexible working arrangements and remote work are widely accepted.
• Equality & Informality — Workplaces are relatively flat, and titles are less emphasized. Managers often adopt a collaborative leadership style.
• Communication — Direct, respectful, and informal communication is common. Employees expect transparency and fairness in decision-making.
• Multicultural Workforce — Immigration has shaped Australia’s labor force, making it diverse and globally minded.

Talent Pool Strengths

• STEM & Technology — A steady pipeline of IT specialists, engineers, and data professionals, especially in Melbourne and Sydney.
• Finance & Professional Services — Sydney is a regional hub for banking, insurance, and fintech.
• Healthcare & Life Sciences — Strong talent in nursing, biotech, and research, supported by world-class universities.
• Mining & Energy — Perth and Brisbane provide expertise in engineering, natural resources, and renewable energy projects.
• Education & Research — Australia’s universities attract international students and foster global research collaboration.

Key hiring hubs include Sydney (finance & IT), Melbourne (tech & healthcare), Brisbane (energy & infrastructure), and Perth (resources & engineering).

With Gloroots as your Employer of Record in Australia, you gain access to a diverse and skilled workforce while ensuring compliance with the Fair Work Act and industry awards.

Australia Workforce Snapshot

Q. What is the process of setting up an entity in Australia?

Setting up a legal entity in Australia involves registration with multiple regulatory bodies and compliance with corporate, tax, and labor laws. The most common form for foreign businesses is a proprietary limited company (Pty Ltd).

Steps to Establish a Legal Entity in Australia

1. Choose a Legal Structure
   • Common options include Pty Ltd (private company) or branch office of a foreign company.
   • Pty Ltd is the preferred option due to limited liability and ease of operation.
2. Register with ASIC
   • Incorporation must be completed with the Australian Securities and Investments Commission (ASIC).
   • The company receives an Australian Company Number (ACN).
3. Apply for an ABN and TFN
   • Register with the Australian Business Register (ABR) for an Australian Business Number (ABN).
   • Obtain a Tax File Number (TFN) from the Australian Taxation Office (ATO).
4. Register for GST & PAYG Withholding
   • Companies with annual turnover over AUD 75,000 must register for Goods and Services Tax (GST).
   • Employers must register for Pay-As-You-Go (PAYG) withholding to deduct employee income tax.
5. Set Up Superannuation Contributions
   • Employers must contribute 11% of an employee’s ordinary earnings to a superannuation fund (increasing incrementally to 12% by 2025).
6. Comply with the Fair Work Act
   • Employers must follow national minimum wage laws, industry-specific Modern Awards, and leave entitlements.
7. Ongoing Compliance
   • Submit annual company tax returns and BAS (Business Activity Statements) to the ATO.
   • Maintain accurate payroll and HR compliance under the Fair Work Act.

Entity setup typically takes 4–6 weeks, but full compliance with tax and labor laws requires ongoing management.

With Gloroots as your Employer of Record in Australia, you can bypass incorporation and hire within days. We manage payroll, superannuation, and benefits while ensuring full compliance with Australian law.

Q. What are the main benefits of using Gloroots as an Employer of Record in Australia vs setting up your own entity?

Australia offers a highly skilled, English-speaking workforce and a transparent regulatory environment, but setting up a legal entity comes with administrative complexity, high employment costs, and strict compliance requirements under the Fair Work Act and Modern Awards.

Establishing a company requires ASIC registration, ABN/TFN setup, GST registration, payroll compliance, and superannuation management — a process that can take weeks and requires ongoing HR, tax, and legal oversight.

By partnering with Gloroots as your Employer of Record in Australia, you can hire employees within days instead of weeks. Gloroots becomes the legal employer of record, handling contracts, payroll, taxes, and benefits, while you retain full control over employees’ day-to-day work. This ensures faster market entry, compliance, and predictable workforce costs.

Benefits: Direct Entity vs. Gloroots EOR in Australia

Q. What are the key employment laws in Australia that employers should know?

Employment in Australia is governed primarily by the Fair Work Act 2009, which provides the foundation for employee rights and employer obligations. In addition, industry-specific Modern Awards set minimum pay rates, conditions, and entitlements for different sectors. Employers must comply with both the national standards and any applicable awards.

Key Employment Laws in Australia

• Employment Contracts
  • Contracts must align with the National Employment Standards (NES), which guarantee minimum entitlements.
  • Modern Awards often override contracts if they provide greater benefits.
• Working Hours
  • Standard: 38 hours per week, plus reasonable overtime.
  • Flexibility provisions apply depending on industry awards.
• Overtime
  • Overtime pay rates are set by Modern Awards, usually ranging from 150% to 200% of the base rate.
• Minimum Wage
  • As of July 2024, the national minimum wage is AUD 24.10 per hour (or AUD 915.90 per week).
  • Industry-specific Modern Awards may set higher minimums.
• Annual Leave
  • Employees receive 4 weeks of paid annual leave per year.
  • Shift workers are entitled to 5 weeks.
• Sick & Carer’s Leave
  • Employees receive 10 days of paid personal/carer’s leave annually.
  • Unused leave rolls over year to year.
• Maternity & Parental Leave
  • Eligible employees can take up to 12 months unpaid parental leave, with the option to request an additional 12 months.
  • The government funds Paid Parental Leave at the national minimum wage for up to 20 weeks.
• Superannuation
  • Employers must contribute 11% of ordinary earnings to an employee’s superannuation fund (rising to 12% by 2025).

With Gloroots as your Employer of Record in Australia, we ensure contracts, payroll, and benefits align with the Fair Work Act, Modern Awards, and NES standards, helping you stay fully compliant.

Employment Law: Direct Entity vs. Gloroots EOR in Australia

Q. What types of work visas are available in Australia, and how can Gloroots help?

Australia attracts global talent, but non-citizens and non-permanent residents must hold a valid work visa to be employed. Visa processes are overseen by the Department of Home Affairs, and most require employer sponsorship — which means only registered Australian entities can sponsor workers.

Main Types of Work Visas in Australia

1. Temporary Skill Shortage (TSS) Visa (Subclass 482)
   • Allows employers to sponsor skilled workers to fill shortages.
   • Two streams: short-term (up to 2 years) and medium-term (up to 4 years).
   • Requires the employer to be an approved sponsor.
2. Skilled Independent Visa (Subclass 189)
   • For skilled workers not sponsored by an employer.
   • Based on a points-tested system considering age, skills, and English proficiency.
3. Skilled Nominated Visa (Subclass 190)
   • For skilled workers nominated by an Australian state or territory government.
   • Permanent residency pathway.
4. Employer Nomination Scheme (ENS) Visa (Subclass 186)
   • For skilled workers nominated by an approved Australian employer.
   • Provides permanent residency.
5. Regional Sponsored Migration Scheme (RSMS) Visa (Subclass 187)
   • For skilled workers nominated by employers in regional Australia.
6. Working Holiday Visa (Subclass 417/462)
   • Short-term visa for young workers (usually up to age 30 or 35) from eligible countries.
   • Allows work for up to 12 months (extensions possible with regional work).

How Gloroots Helps with Work Visas in Australia

One of the biggest barriers for foreign employers is that only Australian-registered entities can sponsor work visas. Without a local subsidiary, companies cannot directly sponsor skilled migrants.

With Gloroots as your Employer of Record in Australia:

• We act as the legal sponsor for TSS and ENS visas under our Australian entity.
• We handle the entire visa process — applications, renewals, and compliance reporting.
• We ensure employees meet skills, salary, and English language requirements.
• We support family/dependent visa applications.
• We guide employers on the best visa pathways (e.g., TSS vs. permanent residency routes).

This means you can hire international talent in Australia quickly and compliantly — without waiting months to establish your own sponsoring entity.

Q. What are the risks of misclassification in Australia?

In Australia, the distinction between an employee and an independent contractor is tightly regulated under the Fair Work Act 2009, the Independent Contractors Act 2006, and case law. Misclassifying employees as contractors to avoid tax, superannuation, and benefits obligations can lead to significant financial penalties, back payments, and reputational damage.

Criteria for Determining Employment vs. Contracting

A worker is generally considered an employee if they:

• Work under the direction and control of the employer (hours, methods, supervision).
• Are integrated into the company’s operations (using company tools, email, branding).
• Are paid a regular wage or salary, rather than by project.
• Cannot subcontract or delegate their work.
• Are entitled to paid leave and superannuation contributions.

Contractors are expected to:

• Operate an independent business.
• Work for multiple clients.
• Invoice for services and carry financial risk.
• Provide their own tools and equipment.

Penalties for Misclassification in Australia

• Back Pay & Benefits: Employers may be liable for unpaid wages, superannuation, leave entitlements, and overtime.
• Tax & Superannuation Liabilities: The Australian Taxation Office (ATO) may demand unpaid PAYG withholding tax and 11% super contributions (increasing to 12% by 2025).
• Civil Penalties: The Fair Work Ombudsman can impose penalties of up to AUD 93,900 per breach for corporations.
• Sham Contracting Offences: Deliberately misclassifying workers as contractors is unlawful and carries additional fines.
• Reputational Risk: Misclassification disputes can damage employer credibility in Australia’s competitive job market.

With Gloroots as your Employer of Record in Australia, you avoid misclassification risks by ensuring workers are hired under compliant contracts, with payroll, superannuation, and benefits handled correctly.

Misclassification Risk: Direct Entity vs. Gloroots EOR in Australia

Q. How does an EOR help you run payroll in Australia?

Payroll in Australia is governed by the Fair Work Act, the Australian Taxation Office (ATO), and industry-specific Modern Awards. Employers must ensure accurate wage calculations, apply the right entitlements, withhold taxes, and contribute to superannuation. Errors in payroll can lead to penalties, employee disputes, and Fair Work Ombudsman audits.

Payroll Compliance Requirements in Australia

• Salary Payments
  • Employees must be paid at least monthly, usually fortnightly.
  • Payslips must detail base pay, overtime, allowances, deductions, and super contributions.
• Income Tax Withholding (PAYG)
  • Employers must withhold income tax under the Pay-As-You-Go (PAYG) system.
  • Tax is based on progressive income tax brackets and employee tax file numbers (TFN).
• Employer Contributions (~11% of ordinary earnings)
  • Superannuation Guarantee (SG): Employers must contribute 11% of an employee’s ordinary earnings (increasing to 12% by 2025).
  • Additional contributions may apply under Modern Awards or enterprise agreements.
• Leave Entitlements
  • Payroll must integrate annual leave (4–5 weeks), personal/carer’s leave (10 days), and other NES entitlements.
• Overtime & Penalty Rates
  • Modern Awards require premium pay for overtime, weekends, and public holidays (up to 200% of base pay).
• Reporting Obligations
  • Employers must report payroll information to the ATO in real-time via Single Touch Payroll (STP).
  • End-of-year summaries must be filed and accessible to employees through myGov.

How Gloroots Simplifies Payroll in Australia

With Gloroots as your Employer of Record in Australia:

• We calculate wages, overtime, and allowances according to the Fair Work Act and relevant awards.
• We manage PAYG withholding, ensuring accurate tax remittance to the ATO.
• We handle superannuation contributions (11%, rising to 12%).
• We integrate leave accruals and entitlements into payroll.
• We comply with Single Touch Payroll reporting requirements.
• We ensure employees receive compliant payslips, reducing the risk of disputes.

This allows you to run payroll in Australia without building local payroll infrastructure or worrying about award compliance.

Payroll in Australia: Direct Entity vs. Gloroots EOR

Q. How does tax compliance work in Australia?

Tax compliance in Australia is regulated by the Australian Taxation Office (ATO) and integrates income tax, superannuation, and payroll reporting. Employers must deduct income tax under the Pay-As-You-Go (PAYG) system, contribute to superannuation, and report payroll data in real-time through Single Touch Payroll (STP).

Personal Income Tax Rates in Australia (2024–25)

For residents:

• Up to AUD 18,200: 0% (tax-free threshold)
• AUD 18,201 – 45,000: 19%
• AUD 45,001 – 120,000: 32.5%
• AUD 120,001 – 180,000: 37%
• Above AUD 180,001: 45%

Additional taxes:

• Medicare Levy: 2% of taxable income (may increase for higher earners).
• Non-residents are taxed at different rates, with no tax-free threshold.

Employer & Employee Contributions

Employer Contributions (~11% of ordinary earnings):

• Superannuation Guarantee (SG): Employers must contribute 11% of employee earnings into a registered super fund (rising to 12% by 2025).
• Additional super contributions may apply under enterprise agreements or awards.

Employee Deductions:

• PAYG income tax (progressive rates above).
• Medicare levy (2%).
• Voluntary super contributions (salary sacrifice).

Reporting & Compliance

• Single Touch Payroll (STP): Employers must report salaries, PAYG tax, and super contributions to the ATO each pay cycle.
• Business Activity Statements (BAS): Required for companies registered for GST.
• Annual Payment Summary: Employees can access end-of-year summaries via the ATO’s myGov portal.

How Gloroots Simplifies Tax Compliance in Australia

With Gloroots as your Employer of Record in Australia:

• We apply the correct PAYG withholding rates based on employee tax file numbers (TFNs).
• We handle superannuation contributions (11%, rising to 12%).
• We ensure compliance with the Medicare levy and resident/non-resident tax rules.
• We manage STP reporting and all ATO filings.
• We minimize audit and penalty risks through accurate, compliant payroll tax management.

Tax Compliance: Direct Entity vs. Gloroots EOR in Australia

Q. What benefits and entitlements do employees in Australia receive?

Australia has one of the most comprehensive employee protection systems in the Asia-Pacific, governed by the Fair Work Act 2009, National Employment Standards (NES), and industry-specific Modern Awards. These frameworks guarantee minimum rights while allowing additional benefits through enterprise agreements or employer policies.

Core Benefits & Entitlements in Australia

• Annual Leave
  • 4 weeks of paid annual leave per year for full-time employees.
  • 5 weeks for certain shift workers.
• Public Holidays
  • Employees are entitled to 11 national and state-specific public holidays (entitlements vary by state).
• Sick & Carer’s Leave
  • 10 days of paid personal/carer’s leave annually.
  • Accumulates year-to-year if unused.
• Maternity & Parental Leave
  • Up to 12 months of unpaid parental leave (extendable to 24 months).
  • Paid Parental Leave Scheme: government-funded payments at the national minimum wage for up to 20 weeks.
• Superannuation
  • Employers must contribute 11% of ordinary earnings into an employee’s super fund (12% by 2025).
• Long Service Leave
  • After 7–10 years of continuous service (varies by state), employees are entitled to long service leave, typically 8.67 weeks.
• Overtime & Penalty Rates
  • Set by Modern Awards; usually 150%–200% of base pay for overtime, weekends, and public holidays.
• Redundancy Pay
  • Employees with at least 12 months’ service are entitled to redundancy pay, ranging from 4 to 16 weeks’ salary depending on tenure.
• Other Benefits (Common Employer Additions)
  • Private health insurance allowances.
  • Professional development stipends.
  • Remote work and flexible working arrangements.

With Gloroots as your Employer of Record in Australia, you can provide all statutory entitlements and tailor additional global employee benefits to attract top talent in competitive sectors like tech, healthcare, and finance.

Benefits & Entitlements: Direct Entity vs. Gloroots EOR in Australia

Q. What’s involved in hiring and onboarding employees in Australia?

Hiring in Australia requires compliance with the Fair Work Act 2009, the National Employment Standards (NES), and any applicable Modern Awards or enterprise agreements. Employers must ensure employees are provided with compliant contracts, correct pay rates, and registration for superannuation and taxation.

Key Steps in Hiring & Onboarding Employees in Australia

1. Employment Contract
   • Must include job role, salary, working hours, leave entitlements, probation, termination conditions, and reference to Modern Awards (if applicable).
   • Contracts must not provide less than NES or award minimums.
2. Probationary Period
   • Commonly 3–6 months, during which termination is easier but must still follow lawful notice and Fair Work requirements.
3. Fair Work Information Statement
   • Employers must provide all new employees with the Fair Work Information Statement (FWIS), outlining workplace rights.
4. Tax File Number (TFN) Declaration
   • New employees must complete a TFN declaration, and employers must register them with the Australian Taxation Office (ATO).
5. Superannuation Setup
   • Employees nominate their preferred super fund; if none is chosen, employers must contribute to a default MySuper account.
6. Payroll Setup
   • Employers must integrate NES entitlements, award-based pay rules, overtime, and allowances.
   • Employers must also comply with Single Touch Payroll (STP) reporting to the ATO.
7. Onboarding & Induction
   • Induction often includes workplace safety, company policies, and role expectations.
   • Many Australian employers provide training on equality, harassment prevention, and occupational health & safety.

With Gloroots as your Employer of Record in Australia, onboarding is seamless — we issue compliant contracts, register employees for tax and super, integrate leave entitlements, and ensure payroll compliance from day one.

Hiring & Onboarding: Direct Entity vs. Gloroots EOR in Australia

Q. How do you successfully manage a workforce in Australia?

Successfully managing a workforce in Australia requires balancing compliance with labor laws under the Fair Work Act and Modern Awards with a leadership style that reflects Australia’s egalitarian and collaborative workplace culture. Employees expect transparency, fairness, and a strong focus on work-life balance.

Key Considerations for Workforce Management in Australia

• Work-Life Balance
  • Australians value leisure and family time. Employers that offer flexible working arrangements, hybrid models, and reasonable overtime expectations improve retention.
• Flat Hierarchies & Collaboration
  • Workplaces are less hierarchical than in many regions. Employees expect open communication and opportunities to contribute to decision-making.
• Cultural Diversity
  • Australia has one of the most multicultural workforces in the world. Employers benefit from cross-cultural collaboration but must also ensure inclusivity and anti-discrimination compliance.
• Compliance with Awards
  • Modern Awards set mandatory conditions for pay, overtime, allowances, and leave in specific industries. Employers must integrate these into HR and payroll systems.
• Retention & Engagement
  • Skilled professionals, especially in tech, healthcare, and engineering, are in high demand. Employers must provide competitive salaries, professional development opportunities, and benefits packages to remain attractive.

With Gloroots as your Employer of Record in Australia, you can focus on building a high-performing team, while we ensure compliance with Fair Work regulations, Modern Awards, and HR best practices.

Workforce Management: Direct Entity vs. Gloroots EOR in Australia

Q. What are the key steps and requirements in terminating employees in Australia?

Termination in Australia is governed by the Fair Work Act 2009 and requires strict compliance with notice periods, redundancy rules, and protections against unfair dismissal. Employers must also respect entitlements under Modern Awards and enterprise agreements.

Key Termination Requirements in Australia

• Grounds for Termination
  • Valid reasons include misconduct, poor performance, redundancy, or mutual agreement.
  • Employers must ensure termination is not discriminatory or in breach of employee protections.
• Notice Periods (based on tenure)
  • Less than 1 year: 1 week
  • 1–3 years: 2 weeks
  • 3–5 years: 3 weeks
  • 5+ years: 4 weeks
  • Employees over 45 with 2+ years of service receive an extra week.
• Probationary Period
  • During probation (typically 3–6 months), termination is easier but must still follow minimum notice rules.
• Severance & Redundancy Pay
  • Redundancy pay is required for eligible employees (10+ staff), ranging from 4 to 16 weeks’ pay, depending on tenure.
  • Not payable in small businesses (<15 employees) or where redeployment is possible.
• Unfair Dismissal Protections
  • Employees with 6 months of service (12 months in small businesses) can claim unfair dismissal.
  • Employers must demonstrate valid reasons and follow a fair process.
• Special Protections
  • Termination cannot occur due to protected attributes (e.g., gender, race, pregnancy, union activity).

With Gloroots as your Employer of Record in Australia, termination processes are handled lawfully, ensuring compliance with Fair Work, notice, and redundancy rules to minimize the risk of disputes.

Termination in Australia: Direct Entity vs. Gloroots EOR

Q. What is the offboarding process in Australia?

The offboarding process in Australia must comply with the Fair Work Act 2009, National Employment Standards (NES), and applicable Modern Awards or enterprise agreements. Employers must provide proper notice, pay out entitlements, and ensure employee records and tax obligations are updated.

Key Steps in Offboarding Employees in Australia

1. Notice of Termination
   • Provide written notice aligned with statutory requirements and any contractual terms.
   • During probation, shorter notice applies but must still meet minimum standards.
2. Final Payroll & Settlements
   • Employers must process:
     • Salary up to the final working day.
     • Accrued but unused annual leave (paid in cash).
     • Redundancy or severance pay (if applicable).
     • Superannuation contributions up to the last day of employment.
3. Documentation
   • Issue a Statement of Employment if requested by the employee.
   • Provide final payslip and payment summary (accessible via myGov through the ATO).
4. Tax & Superannuation Reporting
   • Final PAYG withholding must be reported through Single Touch Payroll (STP).
   • Superannuation contributions must be updated and remitted to the employee’s fund.
5. Return of Company Assets
   • Collect company devices, uniforms, and access cards.
   • Terminate system and building access.
6. Exit Interviews & Handover
   • While not legally required, many employers conduct exit interviews and ensure handover of responsibilities.
7. Immigration Compliance (if applicable)
   • For sponsored employees on work visas (e.g., TSS subclass 482), the Department of Home Affairs must be notified.

With Gloroots as your Employer of Record in Australia, we handle offboarding from payroll settlements to immigration compliance, ensuring smooth and compliant employee exits.

Offboarding in Australia: Direct Entity vs. Gloroots EOR

Q. What costs and financial planning do you need with an Employer of Record in Australia?

Hiring in Australia requires careful financial planning, as employment costs extend beyond base salaries to include superannuation contributions, paid leave entitlements, redundancy obligations, and payroll taxes. Companies establishing their own entity also face setup and compliance costs with ASIC, ATO, and Fair Work.

Key Employment Cost Considerations in Australia

• Base Salary
  • Salaries vary by sector but must at least meet the national minimum wage (AUD 24.10/hour in 2024–25) or the higher rates set by Modern Awards.
• Employer Contributions (~11% of ordinary earnings)
  • Superannuation Guarantee (SG): 11% (rising to 12% by 2025).
  • Additional contributions may apply under enterprise agreements or awards.
• Leave Entitlements
  • Employers must fund 4–5 weeks annual leave, 10 days sick/carer’s leave, and long service leave after 7–10 years (varies by state).
• Overtime & Penalty Rates
  • Modern Awards mandate overtime and penalty pay (150%–200% of base pay) for weekends, nights, and public holidays.
• Redundancy Pay
  • Ranges from 4–16 weeks’ salary, depending on tenure (not required for businesses with fewer than 15 employees).
• Payroll Tax (State-based)
  • Applies to employers whose total Australian wages exceed state thresholds. Rates and thresholds vary by state (e.g., NSW threshold AUD 1.2M, rate 5.45%).
• Entity Setup & Administration (Direct Entity only)
  • ASIC incorporation fees, ABN/TFN/GST registration, payroll setup, and HR/legal staff add to overhead.

Gloroots offers a transparent cost structure through our EOR pricing model, which includes payroll, tax filings, and superannuation compliance. This ensures predictable workforce costs without the hidden overheads of entity management.

Cost Planning: Direct Entity vs. Gloroots EOR in Australia

Q. What challenges might you face, and how do you solve them using EOR in Australia?

Australia is one of the most attractive hiring markets in the Asia-Pacific region, thanks to its skilled, English-speaking workforce and stable economy. However, employers face challenges related to complex labor laws, high employment costs, and compliance with Modern Awards. Without local expertise, these issues can increase legal risks and operational overhead.

Common Challenges in Hiring & Managing Employees in Australia

1. Compliance with Modern Awards
   • Over 100 industry-specific awards set pay rates, overtime rules, allowances, and entitlements. Misapplication can result in underpayment claims and fines.
2. High Employment Costs
   • Employer superannuation contributions (11%, rising to 12%), overtime premiums, and paid leave entitlements add significantly to base salary costs.
3. Strict Termination Rules
   • Employers must provide lawful notice, redundancy pay, and avoid unfair dismissal claims under the Fair Work Act.
4. Payroll & Tax Complexity
   • Employers must calculate PAYG withholding, superannuation, and state-based payroll taxes while reporting in real-time to the ATO through STP.
5. Entity Setup & Administration
   • Incorporating a Pty Ltd company requires ASIC registration, ABN/TFN setup, and ongoing tax and compliance reporting.

How Gloroots EOR Solves These Challenges

With Gloroots as your Employer of Record in Australia:

• We ensure compliance with Modern Awards in contracts, payroll, and benefits.
• We manage superannuation, leave entitlements, and redundancy pay end-to-end.
• We handle terminations lawfully, minimizing risks of unfair dismissal claims.
• We run payroll, tax, and STP reporting seamlessly through our system.
• We eliminate the need for entity setup, enabling hiring in days instead of weeks.

This allows global companies to expand into Australia quickly, compliantly, and with full cost transparency.

Challenges in Australia: Direct Entity vs. Gloroots EOR

Conclusion

Australia is a strategic gateway to the Asia-Pacific, offering a highly skilled, English-speaking workforce, a stable business environment, and thriving industries in finance, technology, healthcare, mining, and renewable energy. However, employers face challenges such as strict compliance with the Fair Work Act, industry-specific Modern Awards, high social contributions, and complex payroll/tax systems.

By partnering with Gloroots as your Employer of Record in Australia, you can expand into the market without setting up a local entity. We manage payroll, superannuation, contracts, tax compliance, and employee benefits, ensuring you stay compliant while focusing on growth.

Gloroots makes hiring in Australia simple, compliant, and cost-efficient.

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