- Overview: Australia
- Global HR Compliance
- Global PEO and Payroll
- Work Permit for Hiring Foreign Talent with Global EOR
- Expand without a company set up
- Contractor vs. employee: which is better?
Global Employer of Record (EOR) in Australia
What Is a Global Employer of Record?
A Global Employer of Record (EOR) is a company that takes on the responsibility of being the legal employer of workers in foreign countries on behalf of another company. This allows businesses to expand their global reach and hire talent in different countries without setting up their own legal entity in each country, which can be time-consuming and costly.
When a company engages a Global EOR, they take care of all the legal and administrative tasks related to hiring and managing employees in a foreign country, such as payroll processing, tax compliance, benefits administration, and employment contracts. The employees work for the client company, but they are legally employed by the Global EOR. This arrangement allows businesses to expand their global workforce quickly and compliantly while minimizing their risk and administrative burden.
Global Employment Services in Australia by Acumen International
1. Recruitment |
2. Global Mobility |
3. Checks |
4. Onboarding |
5. Payroll Administration |
6. Working Time & PTO Processing |
7. Benefits Administration |
8. Tax Administration & Reporting |
Offboarding |
| Talent skilled in highly-specialized areas | Employee Work Visa and Work Permit sponsorship | Health checks | Employment Agreement drafting | In-country registration with statutory bodies | Working hours | Mandatory Benefits | Tax Reporting frequency and requirements; | Employment agreement termination: |
| Executive search | Dependent Visa | Criminal record checks | Compliant worker onboarding on your behalf | Day-to-day payroll management | Overtime | Health insurance | Employer taxes & contributions | Dismissal – by the employer |
| Contingency workforce | Visa extension | Background checks | Account setup in the payroll and HR system | Monthly pay slips or other pay frequency | Public holidays | Workers’ compensation | Employee taxes & contributions | Resignation – by the employee |
| Application for a sponsor license for a foreign national | Education checks | Employee data entry and records maintenance | Accruals | Annual leave | Unemployment insurance | Withholding tax | Termination by mutual agreement | |
| Relocation assistance | Managing probation periods | Allowances | Parental leave | Voluntary Benefits | Local tax payments and reporting to local authorities | Notice period handling | ||
| 13th and 14th salary | Sick leave | Share plans for executives | End of financial year reporting | Final settlement & severance payments | ||||
| Additional leave | Bonuses & Equipment provision | De-registration with statutory bodies | ||||||
| Expenses reimbursement & business trip processing | ||||||||
| Health insurance, dental treatment |
Benefits of using a Global Employer of Record (EOR) in Australia
There are several benefits of using a Global Employer of Record (EOR) in Australia, including:
1. Cost savings
Setting up a legal entity in a foreign country can be costly and time-consuming. By using a Global EOR, businesses can save on the expenses associated with establishing their own legal entity, such as legal fees, accounting costs, and compliance costs.
2. Compliance
Employment laws and regulations can vary significantly from one country to another, and keeping up with these regulations can be challenging. A Global EOR can ensure that businesses fully comply with local labor laws, regulations, and tax requirements, reducing the risk of non-compliance penalties and legal disputes.
3. The flexibility of Global Expansion Moves
Using a Global EOR allows businesses to hire and manage their workforce in different countries without committing to long-term investment. This allows businesses to test new markets, expand their operations, and adjust their workforce based on market demand.
4. Time-saving
Outsourcing employment administration and compliance tasks to a Global EOR frees up time and resources businesses can use to focus on their core activities.
5. In Country Employment Expertise
Global EORs have extensive knowledge and experience in managing employment compliance and administration across different countries, which can be invaluable for businesses that lack this expertise in-house.
17 Burdens a Global EOR Can Relieve for Your In-House HR Department in Australia
- Global expansion complexity
- Global payroll administration
- Employee benefits administration
- Drafting compliant employment contracts to adhere to local labor and tax regulations in 190 countries
- Lengthy onboarding
- Complex and risky offboarding
- Background checks
- Workforce compensation administration
- Compliance assistance
- Guidance on best practices of voluntary benefits provisioning
- Immigration and relocation support for your ex-pat workforce, such as visa sponsorship and securing work permits
- Lack of institutional knowledge.
- IP right protection
- Lack of local and international legal support
- Convert local contractors into full-time employees
- Business transitions: acquisitions, mergers, close-downs
- Need to deal with multiple global employment service providers.
A Global Employer of Record Can Support M&A Processes in Australia
Over the last couple of years, there has been a surge in M&A deals in Australia, totaling billions of dollars in transaction value. Australia witnessed a growing number of M&A transactions with dozens of billion in total transaction value. Statistics indicate a marked rise in the number of outbound mergers and acquisitions involving Australian companies, with the IT sector leading the way.
According to a recent report by Gilbert & Tobin, foreign investment in Australia has increased from North America and Europe. In 2022, deals involving foreign bidders accounted for $26 billion, which represents 58% of the aggregate transaction value of all public M&A deals. This suggests that Australia remains an attractive foreign investment destination, especially when considering the foreign bidder success rate, which was at 94%.
This trend of Western countries investing in Australian assets has risen in recent years, especially since the tightening of foreign investment regulatory oversight.
This trend may continue, especially since Australia remains an attractive destination for foreign investment.
The increase in foreign investment in Australia, particularly from North America and Europe, can open up new opportunities for global employment solution providers, with more foreign companies acquiring Australian businesses or expanding their operations into Australia.
A Global Employer of Recod can help foreign companies navigate local labor laws, develop HR policies that comply with Australian tax regulations, and provide hiring solutions that meet local market needs. This could include services such as recruitment, payroll, and benefits administration.
Additionally, with the increase in M&A activity, there may be a need for Global Employer of Record solution providers to support integration efforts between acquiring and acquired companies. This could include aligning HR policies, harmonizing employee benefits, and ensuring a smooth transition for affected employees.
Global Payroll Calculator: Accurate Global Employment Cost Estimation
- Do you know which country is the most cost-effective place to hire employees?
- What are the costs of entity establishment and legal representation?
- What are the payroll costs and management fees?
- What are your ongoing annual tax compliance costs?
- Are you fully aware of banking implications?
- Did you know that labor laws and hidden costs could make your company less efficient when choosing a country to run your business?
- Did you know that there could be a more cost-effective country to hire employees in and save up to 50%?
This is because countries have different labor laws, compliance, and tax regulations. What if, instead of limiting your company’s international expansion by cutting through the jungle of local regulatory compliance, tax, labor, and immigration requirements, you could have all the information of 190 countries at your fingertips?
Acumen International offers the Global Payroll Calculator to help businesses understand the compliance requirements for conducting business in a new country. Acumen’s research team tracks developments in 190 countries around the globe. It provides up-to-date data on local regulations related to tax, payroll regulations, benefits, hiring practices, compliance requirements, and other labor-related factors that impact an employer’s bottom line. This valuable information makes the Global Payroll Calculator an invaluable tool for businesses looking to expand internationally.
Global Payroll Calculator helps companies reduce labor costs by providing up-to-date information on hiring, compensation, and tax requirements. It is also an ideal tool for quickly locating employees in any country.
Global EOR (Employer of Record) Services: Save Up to 75-80% of Employee Management Cost
| Average Cost & Time | Our Solution * | |
|---|---|---|
| Time to Market | 10+ weeks | 72 hours |
| Legal Advisors Fees | $ 10 000 + | …………. |
| Official Employment & Benefits | $ 20 000 + | …………. |
| Incorporation & Liquidation Costs | $ 11 000 + | …………. |
| Bank Account Setup | $ 2 000 + | …………. |
| Maintenance costs and in-house staff to manage the foreign entity, payroll set up, and administration. | $ 25 000+ | …………. |
| The approximate total cost of new market entry** | $ 74 000 + | $ 15 000 |
* Per one Employee
** Costs vary from country to country
Spotlight on Australia
Australia (officially the Commonwealth of Australia) is the largest country in Oceania, the sixth-largest country globally, and the world’s smallest continent by total area. Australia comprises the mainland of the Australian continent, the island of Tasmania, and numerous smaller islands. Australia consists of 6 states and two territories.
- Capital: Canberra
- Official language: English
- Population: 26,068,700 (2023 estimate)
- Labor Force: 13.812 million (2023)
- Industries: The manufacturing industry is built around the food industry, machinery and equipment, mining, metal processing and metal goods, and the chemical and petrochemical industries. The services sector occupies a dominant position in the Australian economy; the biggest growth in this sector has been the rise of business and financial services, health care and social assistance, and travel services.
- Trading partners: Traditionally, Australia is an importer of finished goods. China, the United States, Japan, Germany, and Thailand are the main import partners. The agricultural and mining sectors are the most important for exports: Australia is a vast agricultural country and one of the world’s main exporters of wool, meat, wheat, and cotton. The export partners are China, Japan, South Korea, and India.
- Local currency: The Australian dollar is the currency of Australia, including its external territories (sign: $; code: AUD)
- Minimum wage: As of July 1, 2022, the minimum wage in Australia is 21.38 AUD per hour (812.60 AUD per week). The Fair Work Commission reviews the national minimum wage every year, and any increases in minimum wage take effect on the first full pay period on or after July 1. Employees not covered by the Fair Work Act are subject to their state minimum wage. Like the national minimum wage, state minimum wages are reviewed annually and according to State Wage Fixing Principles.
- Salary Currency: Industrial instruments may contain terms regarding the currency in which employees must be paid. If no currency is specified in an industrial instrument or employment contract, the rates specified will be presumed to be Australian dollars.
- 13, 14th salaries: There is no legal requirement for bonuses or 13th, 14th salary payments. Employers can pay bonuses at their discretion. Often, many employers provide bonuses in Australia as an incentive and for retention purposes.
Legally Onboard and Payroll your Employees in Australia with Acumen’s Global Employment Solution
Breaking into Australia’s market or engaging local talent companies could face additional taxes and penalties.
There are special tax rules around Personal services income (PSI). The PSI rules were introduced to prevent the shifting or splitting of income with other individuals or entities in an attempt to pay less tax. PSI applies to contractors working in Australia if their business is generating ‘personal services income’, and does not affect an employee receiving only salaries. But, if you are operating through an entity and are an employee of that entity, then the PSI rules may apply.
The penalties imposed for an individual or employer found guilty of hiring an unlawful employee is treated rather seriously under Australian law. Companies can be fined up to $66,000 for every illegal worker who is found to be working within the company and up to $165,000 for exploiting a migrant worker. Also it’s against the Australia’s law for a business to incorrectly treat their employees as contractors. Fine for misclassifying an employee as an independent contractor in Australia up to AUD $63,000.
Reduce your risks while expanding your business, without establishing your own legal entity in Australia. You can trust Acumen to handle the global employment and HR details of your workforce management in Australia to ensure full compliance with in-country employment laws.
Acumen’s Global employment services are designed to provide our clients with professional assistance to meet their global HR needs, such as:
- Global talent acquisition and retention
- Global expansion, to help you quickly enter new global markets without legal and HR compliance risks
With Acumen, you can rest assured that all legal requirements are met for compliant hiring and compensating your employees in Australia, and in 190 countries worldwide where we serve our international clients.
Acumen International offers a global PEO and payroll solution to handle all the payroll details while ensuring full compliance with in-country labor and taxation laws.
