Employment in Australia is governed by the Fair Work Act 2009 and its 11 National Employment Standards (NES). Modern awards and enterprise agreements often add industry-specific minimums on top. Here is what employers need to know about leave, pay, tax and ending employment.
The NES sets minimum leave for all national system employees. Entitlements for part-time employees are pro-rata, and casual employees receive a 25% pay loading instead of paid annual and personal leave.
20 days a year for full-time employees, accrued progressively. 5 weeks for some shift workers. Unused leave carries over and is paid out when employment ends.
Paid sick and carer's leave at the normal rate of pay, paid by the employer. Accrues progressively and carries over year to year.
After 12 months of continuous service, with the right to request a further 12 months (up to 24 in total).
Funded by the government at the national minimum wage for eligible parents, usually paid through the employer. Super is paid on it too.
Australia has no separate statutory maternity or paternity leave. Both parents are covered by the same parental leave entitlements: unpaid parental leave from the employer under the NES, and government-funded Paid Parental Leave that parents can share. Many employers offer their own paid parental leave on top of this.
Set up each Australian leave type in IceHrm with its own accrual, carry forward and approval rules, including pro-rata entitlements for part-time staff. Employees see their live balance before they apply, and managers see who is away on a shared calendar. Leave management →
The Fair Work Commission reviews minimum wages every year, with changes taking effect on 1 July.
A$26.44 per hour for a 38 hour week, from 1 July 2026. Modern awards set higher minimums for many jobs.
For full-time employees, plus reasonable additional hours. Usually Monday to Friday, 7.6 hours a day.
Paid on top of the base rate to casual employees in place of paid leave entitlements.
Overtime, weekend and public holiday penalty rates are set by the applicable modern award or enterprise agreement rather than by the NES. Always check which award covers each role.
Capture attendance and overtime in IceHrm and feed the hours straight into payroll, so award rates and overtime reflect what was actually worked. Time & attendance →
Australia taxes personal income at progressive rates. Employers withhold tax from each pay (PAYG withholding) and report pay, tax and super to the ATO through Single Touch Payroll every pay run.
| Taxable income | Rate | Tax on this income |
|---|---|---|
| A$0 – A$18,200 | 0% | Nil |
| A$18,201 – A$45,000 | 15% | 15c for each $1 over $18,200 |
| A$45,001 – A$135,000 | 30% | $4,020 plus 30c for each $1 over $45,000 |
| A$135,001 – A$190,000 | 37% | $31,020 plus 37c for each $1 over $135,000 |
| A$190,001 and over | 45% | $51,370 plus 45c for each $1 over $190,000 |
On top of gross salary, employers pay superannuation and, depending on the state and industry, payroll tax and workers' compensation premiums.
Of each employee's qualifying earnings. Since 1 July 2026 (Payday Super) it must be paid with every pay run, not quarterly.
A state and territory tax, payable only once total Australian wages exceed the state's threshold.
Insurance is compulsory. Premiums depend on the state, industry and claims history.
Non-cash benefits such as company cars or private health insurance premiums paid for employees attract fringe benefits tax (FBT) at 47% of the grossed-up value of the benefit.
Build Australian pay the way you already structure it, with your own salary components, deductions and formula columns, such as a super contribution column. Want to know how well IceHrm handles payroll calculations for Australia? Contact us or see Payroll →
Employment in Australia is not "at will". Once an employee has completed the minimum employment period (6 months, or 12 months with a small business of fewer than 15 employees), they are protected from unfair dismissal. A dismissal must have a valid reason related to capacity or conduct, or be a genuine redundancy.
| Continuous service | Notice |
|---|---|
| 1 year or less | 1 week |
| More than 1 year, up to 3 years | 2 weeks |
| More than 3 years, up to 5 years | 3 weeks |
| More than 5 years | 4 weeks |
Redundancy pay applies when a job is no longer needed, not to every termination. Employers with fewer than 15 employees generally don't have to pay it under the NES.
| Continuous service | Redundancy pay |
|---|---|
| Less than 1 year | Nil |
| 1 year, less than 2 years | 4 weeks |
| 2 years, less than 3 years | 6 weeks |
| 3 years, less than 4 years | 7 weeks |
| 4 years, less than 5 years | 8 weeks |
| 5 years, less than 6 years | 10 weeks |
| 6 years, less than 7 years | 11 weeks |
| 7 years, less than 8 years | 13 weeks |
| 8 years, less than 9 years | 14 weeks |
| 9 years, less than 10 years | 16 weeks |
| 10 years or more | 12 weeks |
Final pay includes any unused annual leave and, depending on state law, accrued long service leave. Personal/carer's leave is not paid out.
Australia has 8 national public holidays. Each state and territory adds its own, such as Labour Day, Easter Saturday and Melbourne Cup Day, so entitlements depend on where the employee works.
Employees are entitled to be absent on public holidays without loss of pay for their ordinary hours. Employers can request work on a public holiday, but employees may refuse on reasonable grounds.
Leave groups give each state office its own holiday calendar, so a team split across New South Wales, Victoria and Queensland gets the right days off automatically. Holiday calendars →
Employees can be engaged on a full-time, part-time, casual or fixed-term basis. A written contract isn't strictly required by law, but it is strongly recommended, and it can never provide less than the NES or the applicable award.
There is no statutory probation period. Many employers use 3–6 months, which lines up with the 6 month minimum employment period for unfair dismissal protection. Fixed-term contracts are generally limited to a maximum of 2 years, including extensions.
Send contracts and information statements for e-signing, store them on the employee's record, and track onboarding with task lists so nothing is missed on day one. Documents & e-signing →
This guide is general information to help you plan HR processes, not legal, tax or financial advice. Employment law and rates change regularly and awards, enterprise agreements and state rules may give employees more than the minimums shown here. Always confirm current requirements with the official sources or a qualified adviser.
Configure leave types, accrual rules and public holidays for Australia, keep employee records and contracts in one place, and run payroll with your own salary components. Want to know how IceHrm handles payroll calculations for Australia? Talk to us.
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