Hiring is complex all over the world, but if it has the laws and regulations, you might need every legality to hire the employees. It makes HR responsible for most of the leg work. They have to organize their processes, have all the details, know the latest updates of changes in the laws, etc. To help business owners and their HR departments to have a smooth hiring process, we have compiled this short guide about legal hiring requirements in Australia 2022.
The Types of Employment in Australia
Employers in Australia can hire employees in a variety of ways. Many terms define the number of hours worked per week, the length of the employment commitment, and the benefits accordingly.
Full-time employees are employed on a permanent or fixed-term basis and work an average of 38 hours each week. Like permanent employees, you are entitled to paid time off, redundancy pay (based on length of service and company size), and reimbursement when you are absent on a public holiday (if the employee would normally work on that day).
Furthermore, businesses must offer permanent employees between 1 and 5 weeks’ written notice before terminating their employment. Permanent employees are entitled to the National Minimum Wage unless they are covered by a contemporary award. The National Minimum Wage is currently $20.33/hour as of 1 July 2021 and normally increases each July.
Part-time employees engage on a permanent or fixed-term basis and work fewer than 38 hours per week, on regular basis. A Part-time employee is also entitled to the same benefits as a full-time employee, but they are paid on a pro-rata basis.
They are employed on a project-by-project basis and are not hired for the long term. Casual workers’ schedules can vary from week to week, and they may be unable to work for extended periods. Moreover, casual employees are not eligible for paid leave like yearly leave, but they are eligible for unpaid leave like caregiver’s leave and compassionate leave. Long service leave is also available to casual employees.
Employees that are hired on a fixed-term basis are hired for a specific amount of time. Such as to work on a 6-month project or to cover another employee’s parental leave. Fixed-term employees have the same advantages as permanent employees and can be hired part-time or full-time.
Apprentices and trainees are employees who work for a company in order to obtain experience in their chosen industry while also studying. A registered training organization (RTO), such as a TAFE, trade school, or college, must be the education provider.
Independent contractors vs. employees
Probably, an independent contractor is a person who works for a specific job or amount of time under contract (e.g., a plumber hired to fix a leak).
Also, unlike an employee, an independent contractor does not work for an employer regularly; instead, they labor as needed.
Performs tasks on a regular basis under the direction and control of their employer. They usually work regular or established hours (note that the hours of a casual employee may fluctuate from week to week).
Their employer is required to pay superannuation contributions into a selected superannuation fund. They also have a right to the tools and equipment, as well as allowances for the tools.
Independent contractors vs. employee checklist
It might be difficult to tell if someone is an employee or an independent contractor. This is frequently determined by their individual job requirements.
An independent contractor:
- Determines how they will perform the task for which they get the job
- Each job has the potential to make a profit or a loss
- They are usually covered by their insurance
- They typically have their tools and are capable of working in a range of environments
- Does not have access to paid time off or other employment benefits
- They have complete control over their working hours
- Is rewarded for completing the job for which they were hired
- Sends an invoice to the person who commissioned the work
- They are solely responsible for their own taxes and retirement benefits
- They usually own and operate their own company
An employee:
- Executes their employer’s tasks in the manner that their employer directs
- Carries no financial risk (their employer is responsible for this)
- Work is usually done on the employer’s premises
- Typically, conventional or predetermined hours are worked
- Enjoys advantages such as yearly leave, personal leave, and other perks
- Is paid on a regular basis
- Has their employer managed their tax and superannuation
Employment contracts
An employment contract, according to the Fair Work Ombudsman, is an agreement between an employer and an employee that spells out the terms and conditions of employment. While employment contracts might be verbal, if you don’t document an employee’s terms and conditions in writing when you hire them, you’ll find yourself in a lot of trouble.
Written employment contracts can help you avoid costly and time-consuming conflicts by clarifying your and your employees’ legal rights and obligations. Work hours, leave rights, and salary must all be specified in your employment contracts, as well as which current award covers the employee (if relevant).
Termination of employment, the protection of confidential information and intellectual property, and post-employment constraints should all be shown in an employment contract.
Along with your workplace standards, it’s also a good idea to provide a list of responsibilities and a job description. As part of their onboarding process, new workers should sign off on workplace policies to ensure that everyone is on the same page.
Workplace policies
Workplace policies are written declarations that detail an organization’s rules and procedures for various aspects of its operations, ranging from day-to-day operations to compliance with labor laws. They should be dynamic instruments that articulate your organization’s values, culture, systems, and processes, not strange documents that wither away on dusty shelves. These policies and procedures assist in defining your company’s expectations for employee behaviour. If you’re asking whether your company requires properly defined workplace policies, the answer is a resounding ‘yes.’
Workplace policy checklist
- Explain the appropriate behaviour of employees as well as the repercussions of violating policies.
- Ensure that your workplace policies are easily accessible to all employees.
- Audit workplace policies on a regular basis to ensure that they are in compliance with applicable laws and other corporate rules and procedures.
- Ensure that all new hires review and acknowledge their awareness and grasp of your workplace policies as part of their onboarding process.
- Explain the expected behaviour of employees as well as the repercussions of violating policies.
Australia’s most important employment legislation
Fair Work Act 2009 16 National Employment Standards (NES)
The Fair Work Act of 2009 is perhaps Australia’s most important piece of labour law. It establishes the basic terms and conditions for most Australian employees covered by the national workplace relations system. The National Employment Standards (NES) are part of the Fair Work Act 2009, which established ten minimum rights for most private-sector workers.
However, it is not the only institute for Australia’s workplace relations legislation; other federal, state, and territory laws are a part of it, and it does not apply to every workplace. Western Australia, for example, has its own state-based workplace relations system that encompasses the private sector in the state to some extent.
Award interpretation 18 Complying with NES and Awards.
Modern awards establish minimum wages and conditions for employees in addition to those provided in the FW Act; therefore, you must determine which award(s) apply to your company and/or employees. Even if you are paying more than the award rate, an award may still apply. If an award applies to your company and/or employees, you must also follow additional rules, such as leave loading, working hours, penalty rates, breaks, and allowances.
There’s a lot to get right when it comes to compliance. Work remuneration varies depending on the age and employee type (permanent or casual). And also if they are a trainee or apprentice under current awards. Then there are adjustments based on the time of day, weekend and public holiday penalty rates, and overtime.
Knowing your complete duties ahead of time is the best way to avoid underpaying your employees. This means you’ll need to know everything there is to know about the terms and circumstances of each award that applies to your company.
Bottom Line
Ultimately, if you don’t want to overdo or underpay your staff, you need to know every legal hiring requirement in Australia. Secondly, apply the latest legal formalities in the company through HR processes. Besides, if you can get automated software; that can automatically comply with the awards and employment regulations, it can save your business from many troubles. If you have a problem understanding any of it or need guidance on the HR software, let the DHRP guide you through it.
