Invest in Australia

Employment Law in Australia

Employees’ Compensation

All companies must have workplace health and safety insurance to operate in Australia.

Some forms of insurance are compulsory for Australian businesses, such as:

• Workers’ compensation – workers’ compensation insurance is mandatory if you have employees.
• Public liability insurance – public liability insurance covers you for third party death or injury. Certain types of companies must take out public liability insurance.
• Third party personal injury insurance – if you own a motor vehicle, you must pay for third party personal injury insurance. This is often part of your vehicle registration fee.

For more info on the type of insurance your business needs, please visit: https://business.gov.au/risk-management/insurance/business-insurance

Work Permits

It is the responsibility of all Australian businesses to employ legal workers.

A person is a legal worker if they are:

• An Australian citizen
• An Australian permanent resident
• A New Zealand citizen, or
• A foreign national with a visa with permission to work in Australia

Minimum Wages

From 1 July 2022, the national minimum wage is $21.38 per hour or $812.60 per 38 hour week (before tax). Casual employees covered by the national minimum wage also get at least a 25% casual loading.

Maximum Working Hours

An employer must not request an employee to work more than the following hours of work in a work week, unless the additional hours are reasonable

• for a full-time employee, 38 hours
• for an employee other than a full-time employee, the lesser of 38 hours or the employee’s ordinary hours of work in a week

The hours an employee works in a week must be taken to include any hours of leave or absence (paid or unpaid) that is authorised:

• by the employer or
• by or under a term of the employee’s employment or
• by or under a Commonwealth, State or Territory law, or an instrument in force under such a law.

An employee may refuse to work additional hours if they are unreasonable. Here is more information on maximum working hours in Australia.

Paid Annual Leave

The Fair Work Act 2009 in Australia states that all permanent employees are entitled to a minimum of 4 weeks annual leave per year, based on their hours of work. This accrues from the start date of the employee. Annual leave is paid out in full on termination of employment. See here for more information on paid annual leave.

Paid Sick Leave

The Fair Work Act 2009 in Australia states that all permanent employees are entitled to a minimum of 10 days personal leave per year, based on their hours of work. This accrues from the start date of the employee.

Part-time employees have pro-rata days of personal leave. See here for more information on paid sick leave.

Termination

An employer must provide an employee with written notice of the day of termination when ending their employment. Some exceptions apply (see below).

An employer may give notice to the employee by either:

• delivering it personally
• leaving it at the employee’s last known address
• sending it by pre-paid post to the employee’s last known address
• if the employee agrees, sending it electronically by email or text message

An employee may also need to give their employer notice of termination if their award or agreement specifies it. Here is a guide.

Long Service Leave

Each state has different legislation on Long Service Leave. Most employees’ entitlement to long service leave comes from long service leave laws in each state or territory. These laws set out:

• how long an employee has to be working to get long service leave (eg. after 7 years)
• how much long service leave the employee gets.

Employees

Benefits In Kind

Health insurance is not common practice in Australia and is not an obligation that employers need to cover.

Share Options

Share options are not commonly used as a benefit in Australia, but for more information please visit: 

https://www.moneysmart.gov.au/investing/shares/employee-share-schemes

New Employees

When hiring new employees, they must be supplied with the Fair Work Information Statement. They also need to complete the tax file number declaration and superannuation standard choice form. Check this link for more information: 

https://www.ato.gov.au/uploadedFiles/Content/IND/Downloads/TFN_declaration_form_N3092.pdf

Discrimination Laws

In Australia, it is unlawful to discriminate on the basis of a number of protected attributes, including age, disability, race, sex, intersex status, gender identity and sexual orientation in certain areas of public life, including education and employment. Australia’s federal anti-discrimination laws are contained in the following legislation:

• Age Discrimination Act 2004
• Disability Discrimination Act 1992
• Racial Discrimination Act 1975
• Sex Discrimination Act 1984.