Employer of Record in Australia

General Information

• Currency: Argentine Peso (ARS)
• Employer Taxes: 26.00% – 29.00% +176 ARS
• Payroll Frequency: Monthly
• Employee Costs: 17%
• Capital: Buenos Aires
• Fiscal Year: 1 January – 31 December

Main Aspects of the Labour Code

Minimum Wage

General: The national minimum wage is 234,315 ARS per month

Payroll

Payroll Cycle: Payment terms are determined by the type of contract and governed by Sections 126 and 128 of the Argentina Employment Contract Law. Here’s how payments are structured:

• Monthly employees receive payment at the end of each calendar month.
• Employees paid on a daily or hourly basis must be paid weekly or bi-weekly.
• Personnel compensated per project basis are paid on a weekly or bi-weekly basis.

Employers are required to process payments within specific timeframes:

Payments for weekly employees must be completed within three working days.

Payments for monthly or bi-weekly employees must be completed within four working days.

13th Salary: According to Argentinean local law, employees are entitled to receive an additional month’s salary known as Aguinaldo, also referred to as the 13th-month salary. This payment is divided into two semi-annual installments, which must be paid before June 30th and December 18th each year.

The amount of each installment equals 50.00% of the highest monthly wage received during the previous 6-month period.

Working Hours

General

The National Employment Standards (NES) stipulate a maximum of 38 working hours per week for all employees covered by the national workplace relations system, regardless of any award, agreement, or contract.

Overtime

All overtime requests must be mutually agreed upon by the employee and employer. Employers are required to assess whether additional hours are “reasonable” before approving overtime. Typically, overtime rates are specified in the contract or awards, with the most common rates being 200% of the regular salary for the first 3 hours of overtime and 150% for subsequent hours.

However, employee agreements, contracts, or awards may stipulate additional allowances and higher overtime rates. These higher rates also apply for overtime work on weekends, public holidays, nights, or under challenging or unpleasant conditions.

Leave

Annual Leave (Vacation):

Under the National Employment Standards (NES) in the Fair Work Act 2009 (Cth), all employees (excluding casual employees) are entitled to paid annual leave. Generally, this amounts to a minimum of 4 weeks of paid leave per year, or 5 weeks for shift workers. Awards and contracts cannot offer less than this minimum, although they may provide additional leave days.

The NES also specifies that if an employee’s annual leave period overlaps with a public holiday or another type of leave (such as sick or personal leave), this time is not counted as annual leave. Annual leave is paid at the employee’s regular salary rate, but certain awards or contracts may include an additional annual leave payment of up to 17.50%.

Additionally, each state in Australia provides for extended service leave entitlements for employees.

Public Holidays

Employees are entitled to a minimum of 10 days of public holidays, which includes 7 national holidays plus additional state-specific holidays. If a holiday falls on a weekend, it is typically observed on another day. For details on specific public holidays, refer to the pages for each state’s calendar.

Sick Days

Under the NES, permanent employees are entitled to 10 days of paid sick leave and 2 days of paid compassionate leave (personal/carer’s leave) per year. Employees can use this leave if they are unable to work due to personal illness or injury, or to provide care or support to a member of their immediate family. This leave is funded by the employer.

Maternity Leave

See Parental Leave.

Paternity Leave

See Parental Leave.

Parental Leave

Paid parental leave provides financial support to eligible working parents of newborn or recently adopted children. This leave lasts up to 20 weeks and can be taken by either parent at the time of birth, adoption, or surrogacy. Each parent is required to take at least 2 weeks of leave. To qualify for parental leave under the NES, employees must have at least 12 months of continuous service or be a “long-term casual employee” who has worked regularly and systematically for at least 12 months.

Parental leave is paid by the government at the national minimum weekly wage rate. Starting from 1 July 2024, an additional 2 weeks of payment will be added to the Parental Leave Pay each year until 2026, extending the Paid Parental Leave scheme by 6 weeks from July 2026.

Employers may also offer paid parental leave through registered agreements, employment contracts, or workplace policies, which can be combined with the Australian government’s paid parental leave scheme without affecting eligibility.

Additionally, employees with over 12 months of service are entitled to at least 12 months of unpaid parental leave if they are responsible for caring for a child or adopted child under 16 years old.

From 6 June 2023, parents requesting unpaid leave for more than 12 months have a stronger right to request an extension of unpaid parental leave. If an employee has taken 12 months of unpaid leave, they can request an additional 12 months (totaling 24 months), provided their partner has not already taken 12 months of unpaid leave.

Initially, all salary payments are made by the employer and subsequently reimbursed by the government.

Other Leave

Under the NES, employees are entitled to be absent from work for three main types of community service activities:

1. Jury Service: Employees are entitled to paid leave for jury service. They receive jury service pay from the government, and employers must top up this amount to match the employee’s usual pay for up to 10 days, based on the rates set.
2. Voluntary Emergency Management Activity: This type of leave is unpaid. Employees are entitled to take leave for voluntary emergency management activities.
3. Community Service Activities: Other community service activities prescribed by regulations also qualify for unpaid leave.

The leave period includes reasonable travel and rest time before and after the eligible activity. Employees are expected to provide as much prior notice and information as possible regarding their absence.

Using an Employer of Record (EOR) service in Australia, such as that offered by Brain Source International, can be highly advantageous for companies looking to streamline their operations and ensure compliance with local employment laws.

Brain Source International provides comprehensive EOR services in Australia, handling various aspects of employment management on behalf of your company. Here’s how they can assist:

1. Compliance Management: Brain Source International ensures that all employment practices are compliant with Australian labor laws, including adherence to the National Employment Standards (NES), relevant awards, and agreements.
2. Payroll and Benefits Administration: They manage payroll, ensuring that employees are paid accurately and on time, including handling taxes, superannuation contributions, and any applicable leave entitlements.
3. Recruitment and Onboarding: Brain Source International can assist with recruiting and onboarding employees, ensuring that all processes meet Australian legal requirements.
4. Employment Contracts: They handle the creation and management of employment contracts, ensuring that they align with Australian regulations and industry standards.
5. Risk Mitigation: By acting as the legal employer, Brain Source International takes on the responsibility for employment-related risks, including compliance with workplace health and safety regulations and addressing any legal disputes.
6. Flexibility: Their services are particularly useful for companies needing to hire staff quickly without establishing a local entity or those employing independent contractors.

Partnering with Brain Source International as your EOR in Australia can simplify your expansion into the Australian market, providing peace of mind that all employment-related aspects are handled professionally and in compliance with local regulations.

Would you like to know the approximate cost of employment in Australia?