Australian Legislation

Australian Legislation

AU01-644442-edited

Enjoying more than two decades of economic expansion, Australia is a vibrant free-market and is one of the wealthiest Asia-Pacific nations. Governed by an effective system, Australia's economy has been strong, unmarred by recession for more than 25 years. Ensuring your business in Australia is accurate, and up to standards is essential to keeping your business successful. To help companies prepare themselves for business, Links has created a legislative page of the main employment laws and best practices in Australia. Please note that all the information listed below are to be used as a general guideline, for more detailed accounts of laws and regulations, please visit the official governmental websites.

 
 
 

 

Company Setup


Company Registration

Companies looking to set up in Australia are required to fill out a form which is to be submitted to the Australian Securities and Investments Commission. Once the company is registered, they will be provided with a company number. For more details on this, you may visit the Australian Securities & Investments Commission (ASIC) site.

http://asic.gov.au/regulatory-resources/forms/forms-folder/201-application-for-registration-as-an-australian-company/

 

Tax Registration

In Australia you need to have an Australian Business Number to make tax payments and withhold PAYG from employees.

https://register.business.gov.au/

Bank Account set-up

To open a bank account in Australia, you need to be an Australian citizen with a tax file number or be in Australia with relevant ID and named as a director for the company that you are opening a bank account for.

 

Social Security & Mandatory Pension Schemes (Superannuation)

All companies that have employees need to have a default super fund, in the event that an employee does not have a super fund, or has not supplied the information for their fund by the time payment is made. The default super fund that you choose must have a “My Super” option, which is a low cost fund.

For a list of all “My Super” options currently available in Australia, please visit the following link: http://www.apra.gov.au/rse/Pages/default.aspx




 
 
 

Employment Law


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.

https://www.business.gov.au/info/run/insurance-and-workers-compensation

 

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

https://www.homeaffairs.gov.au/trav/work 

 

Minimum Wages

Current Min wage in Australia is $18.29 per hour, or $694.90 per 38 hours a week, before tax.

https://www.fairwork.gov.au/how-we-will-help/templates-and-guides/fact-sheets/minimum-workplace-entitlements/minimum-wages

 

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 or
  • 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.

https://www.fairwork.gov.au/how-we-will-help/templates-and-guides/fact-sheets/minimum-workplace-entitlements/maximum-weekly-hours 

 

Paid Annual Leave

The fair work act 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

https://www.fairwork.gov.au/leave/annual-leave 

 

Paid Sick Leave

The fair work act 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.

https://www.fairwork.gov.au/leave/sick-and-carers-leave/paid-sick-and-carers-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.

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

https://www.fairwork.gov.au/how-we-will-help/templates-and-guides/fact-sheets/minimum-workplace-entitlements/notice-of-termination-and-redundancy-pay


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.

https://www.fairwork.gov.au/leave/long-service-leave 

 
 
 
 
 

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 is 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 super choice form.

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:

https://www.ag.gov.au/RightsAndProtections/HumanRights/Pages/Australias-Anti-Discrimination-Law.aspx





 
 

Statutory Benefits


Maternity & Paternity Leave

Employees can get parental leave when a child is born or adopted. Parental leave entitlements include:

  • maternity leave
  • paternity and partner leave
  • adoption leave
  • special maternity leave
  • a safe job and no safe job leave
  • a right to return to old job.

https://www.fairwork.gov.au/leave/maternity-and-parental-leave  

 


 

Tax


Payment Summaries

Employers must supply employees with payment summaries at the end of the financial year, these must be supplied by the 14th of July each year.

The payment summary should show each payee how much is paid to them in the financial year, and how much is withheld from the payments.

https://www.ato.gov.au/business/payg-withholding/payg-payment-summaries/

 

PAYG

Each pay period, tax will be taken from the employees pay and paid to the government on behalf of the employee. These payments include:

  • payments to employees, company directors and office holders
  • payments to workers under a labour-hire agreements
  • payments under voluntary agreements
  • payments where an Australian business number (ABN) has not been quoted in relation to a supply.

https://www.ato.gov.au/Business/Business-activity-statements-(BAS)/Pay-as-you-go-(PAYG)-withholding/

  

Annual Employer Returns

At the end of the financial year, employers are required to submit tax information on their employees to the government. This is currently done using a PSAR file, and used to be called the EMPDUPE

https://www.ato.gov.au/Business/Business-Portal/Using-the-Business-Portal/Lodge-a-file/

 






Payments


Bank Accounts and Paying Salaries

Salaries can be made via direct credit to employee’s bank accounts, and payslips must be supplied within 1 working day of pay day, even if an employee is on leave.

https://www.fairwork.gov.au/pay/pay-slips-and-record-keeping/pay-slips

 

Bonus Payments

If the commission, bonus or similar payment relates to work an employee performed in a single pay period (for example, a week, a fortnight or a month) the amount is added to all their other earnings for the current period. Withholding is then calculated using the standard PAYG withholding tax tables.

https://www.ato.gov.au/Rates/Schedule-5---Tax-table-for-back-payments,-commissions,-bonuses-and-similar-payments/?page=2

 

 

 

Local Information


 Public Holidays 2018

This is the list of public holidays for each state and territory in Australia. Public holidays can be different depending on the state or territory you're in.

Find what the public holidays are in your state territory by selecting from the list below:

 

 
 
 
 
 
 
 
 

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