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Payroll and Benefits Guide Australia

Last updated: Jan 03, 2021

Currency
Australian Dollar (AUD)
Employer Taxes
15.85%
Payroll Frequency
Bi-Monthly/Monthly
Employee Costs
%
Capital
Canberra
Date Format
dd/mm/yyyy
Fiscal Year
1 July - 30 June
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Contributions

Employer

Employer Payroll Contributions

New South Wales

15.85% Total Employment Cost
4.85% Payroll Tax
1.00% Medicare
10.00% Superannuation (capped at 21,002.06 AUD per year)

Employer Payroll Contributions

Victoria

15.85% Total Employment Cost
4.85% Payroll Tax
1.00% Medicare
10.00% Superannuation (capped at 21,002.06 AUD per year)

Employee

Employee Income Tax

Exempt Income up to 18,200 AUD
0.19 AUD for each dollar between 18,201- 45,000 AUD
5,092.00 AUD + 0.325 AUD for each dollar between 45,000- 120,000 AUD
29,467 + 0.37 AUD for each dollar between 120,000- 180,000 AUD
51,667 AUD + 0.45 AUD for each dollar over 180,000 AUD and over

Employer taxes

Highest
Lowest

Minimum Wage

General

As of July 1, 2021, the minimum wage in Australia increased to 20.33 AUD per hour (772.60 AUD per week).

MINIMUM WAGE (PER MONTH)

Highest
Lowest

Payroll

Payroll Cycle

Employees are paid weekly, bi-monthly, or monthly.   

There are no legal requirements to when an employee needs to be paid by, however, it is common to pay employees by the following schedule:

  • Monthly – By the 28th to the 30th of the month
  • Bi-weekly – Every second week on any agreed day (usually Wednesday or Thursday)
  • Bi-monthly – Every 15th and 30th

13th Salary

There are no provisions in the law regarding 13th salaries.

Authority Payments

Authority Payment  Dates Methods
ATO Small withholders up to AUD: 25,000 pa – 28 days from quarter end
Medium withholders AUD 25,001- 1000,000 pa- 21 days from EOM
Large withholders >100,000 pa – Monday/Thursday about 1 week from payment
EFT/BPAY/Australia Post – can use wire as well
AUD
Workers compensation Annually BPAY
AUD
Superannuation
Super Funds
Monthly or quarterly.
If quarterly, 28th day after the end of the each quarter
Direct Debit/EFT/BPAY
AUD
NSW Office of State Revenue
Payroll tax
7th of the following month.
21st of July if annual
Direct Debit/BPAY
AUD
VIC State Revenue Office
Payroll tax
7th of the following month.
21st of July if annual
Direct Debit/BPAY
AUD
QLD Office of State Revenue
Payroll tax
7th of the following month
14th of January of bi-annual
21st of July if annual
EFT/BPAY
AUD
TAS Office of State Revenue
Payroll tax
7th of the following month.
21st of July if annual
EFT/BPAY
AUD
Revenue SA
Payroll tax
7th of the following month.
21st of July if annual
EFT/BPAY
AUD
NT Office of State Revenue
Payroll tax
7th of the following month.
21st of July if annual
EFT
AUD

Working Hours

General

The standard workweek is 38 hours.

Overtime

Minimum employment conditions are outlined in the Fair Work Act, 2009 and Industrial Awards. Awards are either industry-based or occupation-based. Employees covered by Awards are generally paid overtime. Most Awards provide for overtime to be paid for time worked in excess of 38 hours per week, or in excess of 10 hours per day. Overtime or a penalty is generally paid to Award based employees for work performed on a weekend or a public holiday. 

If an employee is not an Award employee, they are considered to be “Award Free.” Award Free employees do not have a statutory right to be paid overtime. However, such employees do have the right to work only 38 plus reasonable additional hours per week. There is no formal definition of what is “reasonable additional hours,” however, such employees are generally expected to work overtime hours that are necessary to complete the job they are employed to do.  

Working Week

Monday-Friday

Leave

Paid Time Off

Full-time employees are entitled to 4 weeks of paid leave per year, while employees who work in shifts receive 5 weeks.

Vacation Days
Public Holidays
Highest
Lowest

Public Holidays

Public holidays vary by state.

Sick Days

Employees are entitled to 10 days paid leave per year which can be used if the employee is sick or if they need to care for a family member. 

Maternity Leave

Mothers are entitled to 12 months unpaid maternity leave after working for 12 months with the same employer. Some employers provide paid maternity leave.

In addition, employees can apply to the Federal Government scheme which provides payment for 18 weeks of maternity leave.

PAID MATERNITY LEAVE (DAYS)

Highest
Lowest

Paternity Leave

Fathers are entitled to 5 days unpaid leave at the time of the birth or adoption of a child.

Employees can also apply to the Federal Government scheme for additional leave.

Parental Leave

Parental leave includes maternity and paternity leave, as well as leave for when a child is adopted.  To be eligible, an employee must have completed at least 12 months of employment.

Parental leave is an unpaid leave that lasts for 12 months, and it is possible to request an additional 12 months from the employer.

Other Leave

Bereavement– 2 days’ paid leave

Termination

Termination Process

Reason for termination varies based on the number of employees an employee has and the length and type of service:

  • 15 employees
    Length of Employment: Up to 6 months
    Type of employees: Permanent
    Reasons for terminations: No specific reason is needed
  • Over 15 employees:
    Length of Employment: 6 months+
    Type of employees: Permanent
    Reasons for terminations: A valid reason is needed
  • 15 employees or less:
    Length of Employment: Up to 12 months
    Type of employees: Permanent
    Reasons for terminations: No specific reason is needed
  • 15 employees or less or less
    Length of Employment: 12 months +
    Type of employees: Permanent
    Reasons for terminations: A valid reason is needed
  • Casual employees:
    Length of Employment: N/A
    Type of employees: Casual
    Reasons for terminations: Once employed for 12+ months, there must be a valid reason

Employees dismissed in the first 6 months of employment (or 12 months of employment if employed by a small business) cannot make a claim of “unfair dismissal” to the Fair Work Commission. However, there are some exceptions to this known as General Protections matters where there is no minimum engagement period applying.

Unfair dismissal applications are heard in the Fair Work Commission – a specialist employment tribunal.

Notice Period

The notice period is determined by the amount of time the employee has been employed:

  • Less than 1 year of employment: 1 weeks’ notice
  • 1-3 years of employment: 2 weeks’ notice
  • 3-5 years of employment: 3 weeks’ notice
  • 5+ years of employment: 4 weeks’

If the employee is over the age of 45 and has been employed for at least 2 years, they are entitled to an additional week of notice.

Severance Pay

Severance pay is given based on a continuous period of service, and the pay rate is given for ordinary hours worked:

  • At least 1 year but less than 2 years: 4 weeks’ severance pay
  • At least 2 years but less than 3 years: 6 weeks’ severance pay
  • At least 3 years but less than 4 years: 7 weeks’ severance pay
  • At least 4 years but less than 5 years: 8 weeks’ severance pay
  • At least 5 years but less than 6 years: 10 weeks’ severance pay
  • At least 6 years but less than 7 years: 11 weeks’ severance pay
  • At least 7 years but less than 8 years: 13 weeks’ severance pay
  • At least 8 years but less than 9 years: 14 weeks’ severance pay
  • At least 9 years but less than 10 years: 16 weeks’ severance pay
  • At least 10 years: 12 weeks’ severance pay

Probation Period

The probation period is 6 months, however, if an employer has 15 employees, it is extended to 12 months. In addition, employers are able to shorten the minimum probation period. In doing so, however, the employer forgoes the benefits of a probation period.

VISA

VISA

Australia has a diverse range of Visas that are intended to suit various professions. Each visa is unique and has specific requirements.

  • Employer Nomination Scheme (ENS) visa: Employers nominate an employee to live and work in Australia. Under this scheme there are three subclasses:
  • Direct entry stream
  • Labour agreement scheme
  • Temporary residence transition stream.

Processing time for these visas can take anywhere from 6-17 months.

  • Temporary activity and specialist visas – Short stay work visa for specific types or highly specialized work.

Temporary Work Visas

  • Temporary Skill Shortage visa – sponsorship needed
  • Temporary Graduate visa
  • Skilled – Recognised Graduate visa
  • Skilled Regional (Provisional) visa
  • Business Innovation and Investment (Provisional) visa– Sponsorship needed

Permanent Work Visas

  • Regional Sponsor Migration Scheme – Sponsorship needed
  • Permanent Residence (Skilled Regional) Visa Open for applications November 2022
  • Employer Nomination Scheme visa– Sponsorship needed
  • Skilled Independent visa
  • Skilled Nominated visa – Sponsorship needed
  • Skilled Regional visa
  • Business Innovation and Investment (Permanent) visa – Sponsorship needed
  • Business Talent (Permanent) Visa – Sponsorship needed
  • Distinguished Talent visa – Sponsorship needed
  • Distinguished Talent visa – Sponsorship needed

Remote Working

General

The Australian government passed the “Secure Jobs, Better Pay” Act legislation that introduces the right for workers to request flexible working arrangements to include no just those who have a disability and those who are aged 55 and older but also to employees who are pregnant and those who have experienced family or domestic violence.

Employers will be required to meet with employees to discuss their flexible work arrangement requests. Employers will need to evaluate such requests and try to accommodate the requests including offering alternative arrangements. If the employer and employee cannot reach an agreement, then an employer is entitled to reject the request on reasonable business grounds. The employer should provide a written explanation of the reasons for refusal within 21 days of receiving the request.

Employees will be allowed to apply to the Fair Works Commission (FWC) to challenge an employer’s refusal or a failure to respond to a flexible work arrangement request. The FWC will have the power to conciliate and arbitrate, including ordering employers to provide additional explanation, granting the employee’s request, or ordering alternative arrangements to accommodate the request.

VAT

General

Goods and Service Tax (GST) is 10%.

For hiring in Australia without a local entity see our Australian PEO service

Stay up to date on payroll & employment law changes

Version History

July 1, 2021
Minimum wage increased to 20.33 AUD per hour (772.60 AUD per week)
Superannuation increased to 10.00%
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Questions & Answers

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Brianna Rockport
Brianna Rockport
3 years ago

Who can request flexible work arrangement? How does it work? 

Emily Kuhnert
Emily Kuhnert
3 years ago

Hi Brianna, thank you for your question! This applies to all employees that are covered by the National Employment Standard (NES). Parents of school-age children, caregivers, disabled employees, employees over the age of 55, an employee experiencing violence from a family member, and a few others can request flexible work arrangements. This could mean reduces working hours, change in schedule, location where work is conducted. To be eligible, the employee must have completed at least 12 months of employment. The employee must make a formal written request detailing the reason for the request, and the employer has 21 days to respond and must give reason if the request is denied. It is important to note that there is no obligation on the employer side to grant the request.

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Payroll and Benefits Guide
in Australia

What’s covered in this guide:

  • Employer/employee contributions
  • Minimum wage
  • Working hours
  • Visa requirements

And more...

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Public Holidays Calendar

Australia 2022
Download:
CSV
PDF
ICS
Day Date Holiday Notes
Saturday Jan-1 New Year's Day
Tuesday Feb-21 Australia Day
Tuesday Feb-21 Easter Saturday
Tuesday Feb-21 Easter Monday
Tuesday Feb-21 Easter Monday
Tuesday Feb-21 Christmas Day
Tuesday Feb-21 Christmas Day
Tuesday Feb-21 Day in Lieu of Christmas Day