How to Hire in Australia - A Guide for Employers

Australia's thriving economy presents a wealth of job opportunities across diverse sectors, particularly in technology and innovation. The country's skilled labour shortage makes it an attractive destination for foreign talent, offering competitive salaries and clear pathways to permanent residency. With a strong emphasis on work-life balance and a multicultural society, Australia provides a welcoming and inclusive environment for professionals from all backgrounds.

Considering this, here’s an employer’s guide on how to hire in Australia.

How to Hire in Australia: Legal Considerations 

The first thing an employer must do when hiring employees is to comply with the relevant pieces of legislation. Adhering to these legal considerations is crucial for employers in Australia to create a compliant, fair, and inclusive workplace. Failure to comply with these laws can lead to legal disputes, financial penalties, and reputational damage.

The Fair Work Act and NES

The Fair Work Act 2009 is a central piece of legislation governing employment relationships in Australia. It provides a safety net of minimum entitlements for employees, known as the National Employment Standards (NES). The NES covers areas such as:

• Maximum hours of work per week
• Leave entitlements 
• Possibility to request for flexible working arrangements 
• Public holidays
• Notice of termination and redundancy pay

Employers must comply with the NES and ensure that employment contracts and workplace practices adhere to these standards.

Here’s a detailed guide on the Key Employment Laws in Australia. 

Awards, Enterprise Agreements, and Employment Contracts

In addition to the NES, employment terms and conditions can be further influenced by awards, enterprise agreements, and individual employment contracts.

• Awards: Awards are legal documents that outline the minimum pay rates and conditions of employment for specific industries or occupations. They provide a baseline for various aspects of employment, including wages, overtime, penalty rates, and allowances.
• Enterprise Agreements: Enterprise agreements are made between employers and a group of employees and can tailor employment conditions to the specific needs of a workplace. They must meet or exceed the standards set by the relevant award and the NES.
• Employment Contracts: Employment contracts are individual agreements between an employer and an employee. While not mandatory, they are recommended to clearly define the terms of employment, including duties, remuneration, and termination conditions. However, they cannot offer less than the applicable award or the NES.

Learn more about Awards, Agreements and Contracts here. 

Laws on Taxes and Super

Employers have tax obligations related to their employees' income. The Pay As You Go (PAYG) system requires employers to withhold income tax from employees' salaries or wages and remit it to the Australian Taxation Office (ATO). 

Employers must also contribute to their employees' superannuation (retirement savings) under the Superannuation Guarantee (Administration) Act 1992.

For more information on your tax, super, and other payroll obligations, you may read this guide on Setting Up Payroll in Australia. 

Anti-Discrimination

Australian law prohibits discrimination in employment based on various attributes, including age, sex, race, disability, religion, sexual orientation, and gender identity. Employers must ensure that their hiring practices, workplace policies, and treatment of employees are free from discrimination.

Decide on the Employee Types

Before you start the recruitment and hiring process, it's crucial to determine the type of employment that best suits your business needs and aligns with the nature of the work. 

In Australia, there are several types of employment arrangements, each with distinct characteristics and legal implications.

Full-Time/Part-Time 

• Full-time employees typically work an average of 38 hours per week, although this can vary depending on the industry and award. They are entitled to a range of benefits, including annual leave, sick leave, and parental leave.
• Part-time employees work less than 38 hours per week. However, they have the same benefits as full-time employees but on a prorated basis, which means their entitlements are proportional to the hours they work.

Fixed-Term

Fixed-term employees are engaged for a specific period or task. Their employment ends automatically when the term expires or the task is completed. They are entitled to the same minimum entitlements as permanent employees, but their rights may differ regarding notice of termination and redundancy pay.

Casual

Casual employees have no guaranteed hours of work and are not entitled to paid leave or other benefits like full-time or part-time employees. They receive a higher hourly rate (casual loading) to compensate for the lack of entitlements.

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Trainee or Apprentice

Trainees or apprentices are employed under a training contract and combine work with structured training. They are entitled to a training wage, which is generally lower than the minimum wage for other employees.

Employee vs. Contractor

It's important to distinguish between employees and independent contractors. Employees work under the direction and control of an employer and are entitled to the benefits and protections of employment law. Contractors, on the other hand, are self-employed individuals or businesses that provide services to clients under a contract. They are responsible for their own taxes and insurance and do not receive the same entitlements as employees.

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Why is Employee Classification Important?

Determining the appropriate employment type is crucial for compliance with the laws. Each employment type has specific legal requirements regarding pay, leave entitlements, and termination. Misclassifying employees can lead to legal disputes and financial penalties.

Furthermore, choosing the type of employment affects various aspects of the organisation, such as cost management (eg. an employee is entitled to benefits, unlike a contractor), workplace flexibility, and employee expectations.  

Recruit and Hire 

The next step on how to hire in Australia is to start with the recruitment and hiring processes. These include advertising the job post, conducting interviews, verifying credentials through background checks, and finally, deciding on who to hire. Here are some of the best practices to take:

Advertise Using Various Methods

To attract a diverse pool of qualified candidates, utilise various advertising methods. These can include online job boards, social media platforms, professional networks, and even traditional methods like newspaper advertisements. 

Consider partnering with recruitment agencies or using your company's website and social media channels to reach a wider audience.

Don't Discriminate in Any of the Steps

Australian law strictly prohibits discrimination in all aspects of employment, including recruitment and hiring. Several pieces of legislation protect individuals from unfair treatment based on their age, disability, sex, and race, respectively. 

Ensure that your job advertisements, selection criteria, interview questions, and hiring decisions are free from bias and comply with anti-discrimination laws.

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Check Their Right to Work, Particularly if You Are Hiring Foreign Employees

In Australia, only Australian citizens, permanent residents, and New Zealand citizens holding a Special Category visa have an unrestricted right to work. 

If you are hiring a foreign employee, it's crucial to verify their right to work in Australia. This typically involves checking their visa status and ensuring that their visa conditions permit them to work for your company in the specific role you are offering.

Learn more about Your Role as an Employer on Work Permits in Australia here. 

Conduct Thorough Background Checks

Background checks are an essential part of the hiring process, helping you verify the information provided by candidates and assess their suitability for the role. They can also help you mitigate potential risks, such as hiring someone with a history of misconduct or fraudulent behaviour.

Some of the most crucial background checks for employment in Australia include:

• Criminal Background Checks: These checks reveal any criminal history the candidate may have, ensuring workplace safety and security.
• Employment History Verification: Verifying a candidate's past employment helps confirm their experience and qualifications, ensuring they possess the skills and knowledge required for the job.
• Education Verification: This check confirms the authenticity of a candidate's educational qualifications, ensuring they meet the educational requirements for the position.
• Reference Checks: Contacting a candidate's references can provide valuable insights into their work ethic, skills, and overall suitability for the role.
• Right to Work Check: For foreign employees, this check verifies their visa status and eligibility to work in Australia.

Here’s more information on Background Checks in Australia.  

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Onboard New Employees

Once you've successfully recruited and hired your new employees, the next crucial step is onboarding. This process involves integrating them into your company culture, providing them with the necessary tools and information to succeed in their roles, and ensuring they understand their rights and responsibilities as employees.

During onboarding, you should:

• Provide an overview of your company's mission, values, and culture. This helps new employees understand the company's goals and how their role contributes to them.
• Introduce them to their team members and colleagues. This helps them build relationships and feel like part of the team.
• Provide them with the necessary training and resources. This ensures they have the skills and knowledge to perform their job effectively.
• Explain their employment contract, benefits, and entitlements. This ensures they understand their rights and responsibilities as employees.
• Complete any necessary paperwork, such as tax file number declarations and superannuation choice forms. This ensures compliance with legal requirements.

A well-structured onboarding process can significantly impact employee engagement, productivity, and retention. It sets the tone for a positive employment relationship and helps new employees feel valued and supported from day one.

The following resources contain helpful information on effective employee onboarding:

• A Guide to Employee Onboarding Software and Its Benefits
• Onboarding Guide For Employers: Must-Have Activities For Effective Onboarding
• Creating your Employee Onboarding Checklist
• Remote Onboarding Best Practices: A Guide for Employers    

Compliance - Fulfilling Your Obligations as an Employer 

Here’s a quick table explaining your legal obligations to your employees:

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For more information on your obligations to your employees, you may read this guide. 

Veremark Can Help You Find the Best Talent 

Veremark’s comprehensive background screening services ensure you're bringing on board trustworthy and qualified individuals, mitigating risks and fostering a secure work environment. 

From verifying employment history and qualifications to conducting thorough criminal checks, Veremark streamlines the hiring process, saving you time and resources. With our global reach and 24/7 support, we cater to diverse hiring needs, ensuring a seamless experience for both employers and candidates. Trust Veremark to be your partner in building a high-performing and compliant workforce.

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