1. Key Points in Employment Contracts
- Full-time/Part-time Employees: Employment Contracts
In Australia, both full-time and part-time employees are formal employees of the company and need to sign employment contracts.
The employment contract must be in English and clearly stipulate the employee’s job responsibilities, work location, working hours, salary, and benefits. It must also comply with the national employment standards stipulated in the Fair Work Act 2009. - Casual Employees and Interns: IC Contracts
The working hours of casual employees in Australia may vary according to the employer’s needs and there is no fixed work schedule. Even casual employees need to be provided with a written employment contract.
This contract will clearly state the casual employee’s salary, job responsibilities, work location, and other relevant employment terms. However, casual employees do not enjoy the statutory company benefits in Australia.
2. Overview of Local Statutory Welfare Systems
- Salary Payment
Normally, Australian employees’ salaries are paid every two weeks or monthly. The payment frequency should be clearly stipulated in the employment contract or relevant agreement. Employers must provide employees with a payslip after salary payment. - Monthly Minimum Wage
According to the announcement of the Fair Work Commission of Australia, since July 1, 2025, the national minimum wage will be increased by 3.5%, specifically:- The minimum hourly wage will be increased from AUD 24.10 to AUD 24.95.
- The minimum weekly wage for full-time employees is AUD 948.
- Probation Period
According to the Australian Labor Code, the maximum probation period is usually 6 months. Normally, the probation period lasts from 3 to 6 months. During the probation period, the employer has the right to dismiss the employee within a reasonable range. However, if the dismissal involves a violation of anti-discrimination laws or other legal provisions, it may lead to legal disputes. - Employer Costs
Employer costs are usually estimated to be 16.34 – 18.21% of the employee’s salary. However, the total cost may vary depending on the state where the employee resides.
Superannuation Guarantee Charge:
- From July 1, 2025, to June 30, 2026: 12%
Workcover Workers’ Compensation Insurance: 2%
Payroll Tax: 4.95 – 6.85%
If an employee enjoys medical benefits, they must pay Fringe Benefits Tax. The Fringe Benefits Tax is 47% of the health insurance premium multiplied by the total tax rate of 1.8868.
3. Salary Payment and Statutory Holiday Responsibilities
- Personal Income Tax
The personal income tax rate ranges from 0% to 45%. Income tax is calculated on a progressive basis. Various factors such as family status, number of children, location, age, and marital status may affect the overall tax rate. - Overtime Pay and Maximum Working Hours
The standard working hours are 7.6 hours per day and 38 hours per week (1967 hours per year). The standard working week is from Monday to Friday. - Statutory Holidays
Full-time and part-time employees are entitled to at least 20 days of paid time off (PTO) per year. PTO accumulates monthly, and employees can take annual leave after accumulating enough leave. - Treatment or Conversion Logic for Unused Annual Leave at the End of the Year
Unused annual leave must be accumulated. If an employee leaves the company, the employer must pay for all accumulated but unused annual leave. - Statutory Public Holidays
Australia celebrates 7 national holidays and several regional holidays depending on the employee’s location. The national public holidays include:
New Year’s Day
Australia Day
Good Friday
Easter Monday
Anzac Day
Christmas Day
Boxing Day
- Other Holidays
- Parental Leave (including Maternity Leave and Paternity Leave)
Employees who have worked for 12 months are entitled to 20 weeks of paid parental leave and up to 24 months of unpaid parental leave. These leaves can be taken together. For paid parental leave, eligible employees will receive the national minimum wage from the government during this period. - Sick Leave
Employees are entitled to at least 10 days of paid sick leave. During this period, employees will receive their normal salary, which is paid by the employer.
- Parental Leave (including Maternity Leave and Paternity Leave)
- Calculation Logic for Incomplete Attendance Salaries (including Absence or Unpaid Leave)
Deducted proportionally - Expatriate Employees
- Local Minimum Wage Required for Work Visas
Different work visa categories (e.g., Temporary Skill Shortage Visa 482, Employer Nomination Scheme Visa 186) have different salary requirements. The immigration department will refer to the market salary level to ensure that the salary paid by the employer to foreign employees is not lower than that of Australian citizens or permanent residents in equivalent positions. - Whether Local Social Welfare Can Be Withdrawn
You can apply to withdraw when you permanently leave Australia.
- Local Minimum Wage Required for Work Visas
- Dismissal (Legal Requirements and Best Practices)
- Notice Period
Less than 1 year: 1 week’s notice in advance
1 – 3 years: 2 weeks’ notice in advance
3 – 5 years: 3 weeks’ notice in advance
Over 5 years: 4 weeks’ notice in advance
In addition, employees who are 45 years old or above and have worked continuously for at least 2 years are entitled to an additional 1 week’s notice period.
*No notice period is required for fixed-term employees. - Severance pay
Depends on the employee’s service years. If there is a modern award, the modern award shall prevail.
< 1 year: None
≥ 1 year: 4 weeks’ salary
≥ 2 years: 6 weeks’ salary
≥ 3 years: 7 weeks’ salary
≥ 4 years: 8 weeks’ salary
≥ 5 years: 10 weeks’ salary
≥ 6 years: 11 weeks’ salary
≥ 7 years: 13 weeks’ salary
≥ 8 years: 14 weeks’ salary
≥ 9 years: 16 weeks’ salary
≥ 10 years: 12 weeks’ salary + full benefits of long-service leave
- Notice Period
4. Dismissal Rules and Compensation Arrangements
- Voluntary Resignation
Employees are allowed to resign at any time by submitting a signed letter of resignation. - Dismissal by Agreement
Common reasons
There may be disputes or lawsuits involving the employee.
Employees cannot be dismissed due to reasons or layoffs.
The employee has negotiated with the client to terminate the employment contract. - Dismissal for Cause
Reasons
Business restructuring
Reallocation of employee responsibilities
Automation of employee tasks
Bankruptcy
Compliance requirements
It must be due to the operational requirements of the employer’s business, and the employee’s job no longer needs to be performed by anyone.
Consultation on layoffs must be carried out in accordance with the applicable modern award or enterprise agreement.
If ≥15 employees are dismissed due to layoffs, the Department of Human Services must be notified in writing.
Statutory notice period
Depends on the employee’s continuous service years and age.
≤ 1 year: 1 week’s notice in advance
≤ 3 years: 2 weeks’ notice in advance
≤ 5 years: 3 weeks’ notice in advance
- Conversion of Annual Leave for Departing Employees
All unused annual leave must be converted into cash. - Official Website of Labor Laws
https://www.fairwork.gov.au/ - Incentive Policies
- The federal government invests in various skills and training programs to ensure that the workforce has the skills required by enterprises.
- Different state governments provide training support for specific enterprises to improve employees’ skill levels.
5. Analysis of Local Governments’ Incentive Measures and Policies for Opening Companies and Hiring Local Employees
- Employment Figures
You can visit the official website of the Australian Bureau of Statistics (http://abs.gov.au) to find the latest labor force statistics. - Unemployment Rate
You can visit the official website of the Australian Bureau of Statistics (http://abs.gov.au) to find the latest unemployment rate statistics. - Average Salary Trend
The average salary in Australia is affected by various factors, including industry, geographical location, work experience, and education level. According to the data released by the Australian Bureau of Statistics (ABS) in May 2024, the average weekly earnings of full-time adult workers are AUD 1923.40.
6. Human Resources Analysis and Employment Suggestions
- Employment Suggestions
In Australia, employers need to be familiar with the Fair Work Act 2009 and its relevant regulations to ensure that all employment practices comply with legal requirements. Understand and comply with relevant industry awards or enterprise agreements to ensure that employees enjoy their due rights and interests. - Language
English - Religious Customs
Australia is a multicultural country with various religious beliefs, including Christianity, Islam, Buddhism, Hinduism, and Judaism. Christianity is the largest religion in Australia, including denominations such as Catholicism and Protestantism. Many Australian traditions and festivals are related to Christianity. Freedom of religious belief is protected by law. - Business Culture
Australians value equality and respect, regardless of the other person’s background, gender, or position. In business negotiations, they usually express their views and opinions directly. Australia’s business culture is relatively casual and friendly. People usually communicate in a relaxed tone and pay attention to building good interpersonal relationships.