Considering doing business in Australia? Could be a good move. The country has the 13th largest economy in the world, is a major regional financial center, and its 5.8% unemployment rate means that there is still some slack in the workforce.
Having weathered the raw materials price slump caused by China’s industrial slowdown and ultimate rebalance, Australia’s economy continues to march forward with a 26-year growth streak and 3.1% increase in GDP. As the slump began to slow the country’s rapid growth, Australia let its currency depreciate, making exports, particularly food going to Chinese consumers, far more appealing. Making the most of every economic opportunity, Australia rode the wave of the biggest mining boom in history and as that winds down is capitalizing on the increase in tourism and housing construction. Australia’s geography and proximity to China may make the country “lucky”, but solid fiscal management has made Australia smart. Unlike Brazil and South Africa, Australia has continued to grow despite the raw materials slowdown.
Despite Australia’s sound fiscal management, continued growth and vibrant educated workforce, expanding there and making a legal hire isn’t simple, but we can offer you a few tips:
- When hiring in Australia, employers must follow the minimum statutory standards and conditions as listed in the Fair Work Act 2009. These National Employment Standards include a list of 10 entitlements that must be in all employee contracts:
- The basic rate of pay
- The type of employment (full-time, part-time or casual)
- Overtime rates
- Work arrangements such as varying hours or shifts
- Annual salary
- Information on leave and leave taking
- Information on settling disputes
- A flexibility term to allow negotiation to meet individual needs
- Australia also has a Pay As You Go tax system, where employers withhold employee taxes and pay them to the government.
- Fringe Benefit Tax: Australian employers are expected to pay a tax on behalf of their employees for fringe benefits. Reporting requirements vary depending on the amount of fringe benefits and the type of benefits. Examples of fringe benefits include:
- A car for work
- Use of a gym facility
- A cheap loan
- Free private health insurance
Laptops and mobile phones for business use are exempt from the fringe benefits tax.
- Australians are entitled to receive a pay slip within one working day of being paid.
- Annual bonuses are not required, but nearly one-third of Australian workers receive them. The average bonus is between 6% and 10% of annual pay. High level executives may receive up to one-half of their salary as an incentive bonus.
- Most full-time employees receive 25-30 days of vacation per year
Get cultural tips and more info on doing business in Australia by visiting our Countrypedia.
Questions? Contact us for answers here.