Australia
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Introduction
General Overview & Economic Facts
- Australia, officially known as the Commonwealth of Australia, is a sovereign country comprising of the mainland Australian continent, the island of Tasmania in addition to numerous smaller islands
- It spans an area of approximately 7,617,930 km2 (2,941,300 mi2) and has a population of approximately 25.69 million
- Australia is a highly developed country with a high-income economy. Its economy is sustained by its abundant natural resources, well-developed international trade relations, mining exports, banking, manufacturing, agriculture and education
- Its economy ranks 13th by nominal GDP (2021) and 19th by PPP (2021)
- It ranks 8th on the HDI with a high quality of life, democracy, health, education, economic freedom, civil liberties, safety and political rights
Why Employ In Australia?
- The main exports are iron ore, coal briquettes, petroleum gas, gold and aluminum oxide
- 12.89 % of the population is between the ages of 15 and 24 years, with 41.15% of the population being between the ages of 25 and 54. Australia has a fairly youthful population, making it a favourable country to employ young, energetic employees
Overview Of The Labour Law
- The main sources of employment law in Australia is legislation (federal, state and territory laws), industrial instruments and the common law
- The National Employment Standard contained in the Fair Work Act is the most important piece of employment law. It provides the minimum terms and conditions for employment including maximum work hours, paid and unpaid leave, notice periods and severance and redundancy pay
- Australia’s labour laws are designed to provide flexibility and protection to both employers and their employees
Fun Country Facts
- An Australian man once tried to sell New Zealand on eBay
- Canberra was selected as the capital because Sydney and Melbourne could not stop arguing which city should be the capital
- Lamingtons originate from Australia
Why Use Playroll Services For Australia?
- Employing in Australia requires companies to have their own legal entity in the country as well as to manage payroll, employee benefits, taxes and legal compliance. This can get quite complicated, especially with the complexity of employment laws in Australia
- With Playroll’s Employer of Record services, your team will be employed by our established legal entities in each country
- We will take care of payroll, employee benefits, taxes, legal compliance and provide ongoing employee support, so that you can focus on growing your team
Employer Contributions
These are additional costs incurred by employers over and above the employee’s monthly gross salary and/or bonus.
Superannuation Guarantee (SG)
10.00%
Fringe Benefits Tax (FBT)
47.00% per annum
Workers Compensation
Victoria
±1.27%
New South Wales
±1.40% – 1.44%
Queensland
±1.20%
South Australia
±1.65%
Western Australia
±1.704%
Australian Capital Territory
±2.80%
Tasmania
±2.50%
Payroll Tax
Australian Capital Territory
Calculated on a minimum total salaries paid by the employer of AUD 2,000,000.00 per annum
6.85%
New South Wales
Calculated on a minimum total salaries paid by the employer of AUD 1,200,000.00 per annum
4.85%
Northern Territory
Calculated on a minimum total salaries paid by the employer of AUD 1,500,000.00 per annum
5.50%
Queensland
Total salaries paid between AUD 1,300,000.00 and AUD 6,500,000.00 per annum
4.75%
Total salaries paid AUD 6,500,000.00 per annum or more
4.95%
South Australia
Total salaries paid between AUD 1,500,000.00 and AUD 1,700,000.00 per annum
0.00% – 4.92%
Total salaries paid AUD 1,700,000.00 per annum or more
4.95%
Tasmania
Total salaries paid between AUD 1,250,000.00 and AUD 2,000,000.00 per annum
4.00%
Total salaries paid AUD 2,000,000.00 per annum or more
6.10%
Victoria
Total salaries paid AUD 700,000.00 per annum or more
Ordinary rate- 4.85%
Regional rate- 1.2125%
Western Australia
Total salaries paid between AUD 1,000,000.00 and AUD 100,000,000.00 per annum
5.50%
Total salaries paid between AUD 1,000,000.00 and AUD 1,500,000,000.00 per annum
5.50% for wages up to 100 Million AUD + 6.00% for wages from 100 Million AUD to 1,5 Billion AUD
Total salaries paid AUD 1,500,000,000.00 per annum or more
5,50% for wages up to 100 Million AUD + 6.00% for wages from 100 Million AUD to 1,5 Billion AUD + 6.50% for wages above 1.5 Billion AUD
Employee Contributions
These are costs incurred by employees that reduce their monthly gross salary and/or bonus to determine their net “take home” pay.
Superannuation (Salary Sacrifice)
Optional. Subject to a contribution cap
Employees can contribute more, but they may have to pay additional tax on the excess amounts
The concessional contribution cap for 2022 is AUD 27,500.00 per annum
Medicare Levy
Individual- reduced levy
Calculated on a minimum salary of AUD 23,227.00 per annum and a maximum salary of AUD 29,032.00 per annum
0.00 – 2.00%
Individual- full levy
Calculated on a minimum salary of AUD 29,033.00 per annum
2.00%
Families, no children- reduced levy
Calculated on a minimum salary of AUD 39,168.00 per annum and a maximum salary of AUD 48,958.00 per annum
0.00 – 2.00%
Families, no children- full levy
Calculated on a minimum salary of AUD 48,959.00 per annum
2.00%
Families, 1 child- reduced levy
Calculated on a minimum salary of AUD 42,765.00 per annum and a maximum salary of AUD 53,454.00 per annum
0.00 – 2.00%
Families, 1 child- reduced levy
Calculated on a minimum salary of AUD 53,455.00 per annum
2.00%
Medicare Levy Surcharge (MLS)
If the employee is an Australian taxpayer who doesn’t have private hospital insurance, and they earn over a certain amount, they may have to pay the Medicare Levy Surcharge (MLS)
Individual
Taxable income of AUD 90,001.00 to AUD 105,000.00 per annum
1.00%
Taxable income of AUD 105,000.00 to AUD 140,000.00 per annum
1.25%
Taxable income of AUD 140,000.00 per annum or more
1.50%
Couples, families and single parent families
Taxable income of AUD 180,001.00 to AUD 210,000.00 per annum
1.00%
Taxable income of AUD 210,000.00 to AUD 280,000.00 per annum
1.25%
Taxable income of AUD 280,001.00 per annum or more
1.50%
Income Tax
Income bracket per annum
0.00 – 18,200.00
0.00%
18,201.00 – 45,000.00
19.00 % for each AUD 1.00 over AUD 18,200.00
45,001.00 – 120,000.00
AUD 5,092.00 plus 32.50% for each AUD 1.00 over AUD 45,000.00
120,001.00 – 180,000.00
AUD 29,467.00 plus 37.00% for each AUD 1.00 over AUD 120,000.00
180,001 or more
AUD51,667 plus 45% for each AUD1 over AUD180,000
Employment Terms
General
Minimum Wage
- National minimum wage- AUD 20.33 per hour
Working Hours
- Maximum of 8 hours per pay and 38 hours per week
- Meal Intervals are usually determined through awards or collective bargaining agreements. The standard is 30 minutes unpaid time.
- Typical working hours start at 08h30 and end by 17h00, Monday to Friday
Overtime
- Overtime work is dependent on whether there is an award for the sector and job title
- If there is no award then the employee is not entitled to overtime pay
- The employee can refuse to work the overtime should it not be a reasonable request
Notice Period
- Employed between 0 and 1 year- 1 week’s notice
- Employed between 1 and 3 years- 2 weeks’ notice
- Employed between 3 and 5 years- 3 weeks’ notice
- Employed for 5 or more years- 4 weeks’ notice
- If an employee is older than 45 and has worked for the employer for at least 2 years then they are entitled to an extra weeks notice.
Severance Pay
- Employed between 1 and 2 years- 4 weeks’ pay
- Employed between 2 and 3 years- 6 weeks’ pay
- Employed between 3 and 4 years- 7 weeks’ pay
- Employed between 4 and 5 years- 8 weeks’ pay
- Employed between 5 and 6 years- 10 weeks’ pay
- Employed between 6 and 7 years- 11 weeks’ pay
- Employed between 7 and 8 years- 13 weeks’ pay
- Employed between 8 and 9 years- 14 weeks’ pay
- Employed between 9 and 10 years-16 weeks’ pay
- Employed for 10 or more years- 18 weeks’ pay
Probation Period
- There is no statutory probation period
- The probation period is determined in the employment contract
- It is common to have a probation period between 3 and 6 months
Bonus
- There is no statutory bonus
Public Holidays
Public holidays 2022
- January 1st – New Year’s Day
- January 3rd – New Year Holiday
- January 26th – Australia Day
- April 15th – Good Friday
- April 16th – Day following Good Friday
- April 18th – Easter Monday
- April 25th – Anzac Day
- June 13th – Queen’s Birthday
- December 25th – Christmas Day
- December 26th – Boxing Day
- December 27th – Christmas Holiday
Leave
Paid Leave / Vacation Days
- Paid leave
- Paid by employer
- 20 days per year
Sick Leave
- Paid leave
- Paid by employer
- Full time sick leave- 10 days
- Part time sick leave- 1/26 of hours worked in a year
Maternity Leave
- Part of parental leave
Paternity Leave
- Paid leave
- Paid by Social Security
- 2 weeks
Parental Leave
- Unpaid leave
- Employee may apply for Paid Parental Leave with Social Security
- 12 months
Unpaid Carers Leave
- Unpaid leave
- 2 days
Compassionate & Bereavement Leave
- Paid leave
- Paid by employer
- 2 days
Family and Domestic Violence Leave
- Unpaid leave
- 5 days
Pre-Adoption Leave
- Unpaid leave
- 2 days