In today’s global employment landscape, Australia stands out for its highly structured and employee-focused legal framework. Governed primarily by the Fair Work Act 2009, Labour Laws in Australia ensure that employees receive fair treatment, while employers are given a clear guide to meeting legal and operational responsibilities. Whether you’re a local employer or an international business hiring employees in Australia, staying compliant is essential for sustainable growth.
This guide explores everything from national standards to modern awards, working conditions, termination rules, and how an Employer of Record in Australia can help simplify compliance.
Table of Contents
- Overview of Labour Laws in Australia
- National vs State Employment Regulations
- Key Employer Obligations in Australia
- Minimum Wage and Salary Requirements
- Working Hours, Breaks, and Overtime Pay
- Leave Entitlements and Public Holidays
- Termination Rules and Notice Periods
- Employee Protections and Anti-Discrimination
- Remote Work, Flexible Work Rights, and WHS Compliance
- Using an Employer of Record (EOR) in Australia
- Compliance Best Practices for Employers in 2025
- Conclusion
- FAQs
Overview of Labour Laws in Australia
Labour laws in Australia are centrally governed by the Fair Work Act 2009, which provides a consistent set of rules for most employees across the country. These laws cover essential aspects of employment, including minimum wages, working hours, employee rights, and dispute resolution mechanisms. The system is designed to balance the needs of workers and employers while offering a flexible and fair workplace environment.
National vs State Employment Regulations
Fair Work Act 2009
The Fair Work Act is the foundation of employment law in Australia. It includes the National Employment Standards (NES), which apply to all national system employees. These standards define minimum conditions such as annual leave, parental leave, public holidays, notice of termination, and redundancy pay. It also establishes rules for unfair dismissal, general protections, and workplace rights.
Role of the Fair Work Commission (FWC)
The FWC is the independent national workplace relations tribunal. It sets minimum wages, adjusts modern awards, resolves disputes, and enforces compliance. Employers can turn to the FWC for guidance on awards, enterprise agreements, and lawful termination practices.
Key Employer Obligations in Australia
Australian employers must adhere to a variety of responsibilities under both the Fair Work Act and other legislation like the Superannuation Guarantee and Workplace Health and Safety laws.
Employment Contracts and Modern Awards
Most employees are covered by a modern award that outlines minimum pay and conditions for specific industries or occupations. Even when individual contracts exist, these awards still apply unless the employee is earning above a threshold. Employment contracts must reflect or exceed these standards.
Payroll, Superannuation, and Tax Withholding
Employers are responsible for:
- Withholding PAYG (Pay As You Go) income tax
- Paying mandatory superannuation contributions (currently 11% in 2025)
- Reporting to the Australian Taxation Office (ATO) through Single Touch Payroll (STP)
Failing to comply with these obligations can lead to penalties, audits, and legal action.
Minimum Wage and Salary Requirements
Australia has one of the highest national minimum wages globally. As of 2025, the national minimum wage is AUD 24.10 per hour, with variations under modern awards. These awards may set higher pay rates based on industry, experience, skill level, or hours worked (e.g., weekends or holidays).
Employers must ensure they review award wage updates every July, when the FWC typically adjusts pay rates.
Suggested Read: Remote Employees Onboarding Checklist with EOR in Australia
Working Hours, Breaks, and Overtime Pay
The NES stipulates that full-time employees should not work more than 38 hours per week, unless reasonable additional hours are agreed upon. Modern awards provide further detail on:
- Overtime rates (usually 1.5x to 2x the base pay)
- Meal and rest breaks
- Rostering and shift arrangements
Employers must keep accurate records of hours worked and ensure employees are compensated for overtime and penalty rates as defined.
Leave Entitlements and Public Holidays
Employees in Australia enjoy generous leave entitlements under the NES, which apply regardless of the state or territory.
Annual Leave
Full-time employees accrue 4 weeks of paid annual leave per year. Shift workers may receive 5 weeks. Leave accrues progressively and can be carried forward if unused.
Sick and Carer’s Leave
Employees are entitled to 10 days of paid personal/carer’s leave each year, plus 2 days of unpaid carer’s leave per occasion.
Parental Leave
Eligible employees can take up to 12 months of unpaid parental leave, with the right to request an additional 12 months. Government-funded paid parental leave is also available to qualifying employees.
Public Holidays
Public holiday entitlements vary by state, but employees required to work on these days may receive penalty rates or substitute days off.
Termination Rules and Notice Periods
When terminating an employee, employers must comply with both contractual obligations and NES minimum notice periods.
Notice and Final Pay
Notice ranges from 1 to 5 weeks depending on the employee’s tenure and age. Final pay must include accrued leave and any redundancy or severance pay if applicable.
Unfair Dismissal Protections
Employees who have worked for at least 6 months (or 12 months in small businesses) are protected from unfair dismissal. Employers must follow a fair process, provide valid reasons, and allow employees a chance to respond.
Employee Protections and Anti-Discrimination
The Fair Work Act and separate state-based legislation prohibit discrimination based on race, sex, disability, age, religion, or other protected attributes. Employees are also protected from workplace bullying, harassment, and victimization.
Employers should implement clear anti-discrimination policies, train staff, and establish complaint procedures to mitigate legal risks.
Remote Work, Flexible Work Rights, and WHS Compliance
Flexible work arrangements are protected under Australian law. Employees with 12 months of service can request flexible working hours or remote work under the NES.
Work Health and Safety (WHS)
Employers must provide a safe work environment, including for remote workers. This includes:
- Conducting risk assessments
- Providing ergonomic equipment
- Offering mental health support
Failure to comply with WHS standards can result in regulatory action and penalties.
Using an Employer of Record (EOR) in Australia
An Employer of Record in Australia enables international companies to hire local talent quickly and compliantly—without the need to establish a legal entity or navigate complex regulatory frameworks on their own. The EOR acts as the official, legal employer of record for the employee, while the client company oversees the day-to-day work and performance.
This model is especially beneficial for startups, remote-first teams, and global enterprises looking to enter the Australian market without delays or administrative burden.
An EOR in Australia typically handles all core employment responsibilities, including:
- Drafting and issuing employment contracts that are fully compliant with Australian labour laws, including adherence to modern awards and the National Employment Standards (NES)
- Managing payroll and superannuation contributions, along with accurate tax withholding and ATO reporting through Single Touch Payroll (STP)
- Tracking employee leave balances, including annual, personal, and parental leave, and ensuring all entitlements are calculated and administered correctly
- Overseeing compliant termination processes, including notice periods, final pay, redundancy calculations, and unfair dismissal risk mitigation
- Maintaining compliance across multiple Australian states or territories, accounting for local variations in public holidays, payroll tax, and WHS obligations
Asanify, for example, offers robust EOR solutions that simplify the hiring process across Australia’s diverse regulatory landscape. Their services help businesses onboard employees in days—not months—while ensuring full legal and tax compliance. This allows companies to focus on growth and operations without being weighed down by legal complexities or HR overhead.
By leveraging an EOR, companies can access top Australian talent, remain compliant with evolving regulations, and scale confidently in a competitive hiring environment.
Compliance Best Practices for Employers in 2025
To maintain compliance with Australian labour laws, employers must adopt a structured and proactive approach across all areas of HR and payroll management. Non-compliance—whether intentional or accidental—can result in serious penalties, legal disputes, and reputational harm.
Here are essential steps for ensuring ongoing compliance in 2025 and beyond:
- Regularly review employment contracts and award updates to ensure all agreements reflect the latest legal requirements, including minimum entitlements, pay rates, and termination clauses.
- Provide training to HR teams and managers on Fair Work obligations, modern awards, anti-discrimination laws, and workplace safety to ensure they implement policies correctly on the ground.
- Maintain accurate payroll, leave, and attendance records to meet recordkeeping obligations under the Fair Work Act and ensure employees are paid correctly and on time.
- Stay informed of Fair Work Commission (FWC) decisions and legislative changes, as national minimum wage rates, award classifications, and employer obligations are reviewed and adjusted regularly.
- Partner with legal advisors or use an Employer of Record (EOR) when expanding into the Australian market to manage cross-state compliance and streamline payroll, benefits, and employment administration.
Taking these actions not only helps reduce the risk of fines and disputes, but also fosters a legally sound and employee-friendly workplace that supports long-term business sustainability.
Suggested Read: Employer of Record (EOR) vs. Entity Establishment in Australia
Conclusion
Australia’s labour laws offer strong protections for workers and clear guidance for employers. Understanding the balance between federal standards and state-specific nuances is essential for success in 2025.
Whether you’re managing local staff or hiring employees in Australia from abroad, staying compliant with working hours, wages, entitlements, and termination laws is non-negotiable.Leveraging an Employer of Record in Australia is one of the most efficient ways to navigate these complexities and ensure your business scales legally and responsibly.
FAQs
The Fair Work Act 2009 is the primary legislation governing employment in Australia and applies to most private-sector employees nationwide.
A modern award outlines minimum pay rates and employment conditions for specific industries or occupations and applies in addition to the National Employment Standards.
Full-time employees are limited to 38 hours per week under the NES, unless reasonable additional hours are agreed upon.
As of 2025, the national minimum wage is AUD 24.10 per hour, with higher rates often specified by modern awards.
While not legally required in writing, employment contracts are strongly recommended to define terms and reduce legal risks.
Employees are entitled to annual leave, personal/carer’s leave, unpaid parental leave, and public holidays, among others.
Yes, employees with at least 12 months of service have the right to request flexible or remote work arrangements.
Termination must follow legal notice periods, include valid reasons, and comply with unfair dismissal protections.
Employers must contribute at least 11% of an employee’s ordinary earnings to a registered super fund as of 2025.
They can partner with an Employer of Record in Australia to manage employment, payroll, and compliance on their behalf.
Not to be considered as tax, legal, financial or HR advice. Regulations change over time so please consult a lawyer, accountant or Labour Law expert for specific guidance.
