Hiring in Australia: costs, rules and the best EOR providers

Labour-hire arrangements are regulated, with licensing obligations depending on location and the actual service. In Victoria, supplying even one worker to a host can bring a business within the licensing scheme. Check the employing supplier and the relevant state regime before treating an EOR agreement as ready to use.

An EOR covered by the national workplace system must provide the Fair Work Act’s National Employment Standards and the applicable award or enterprise-agreement entitlements.

A commercial EOR contract cannot waive that minimum. Confirm employment status, hours, leave, super, notice and any redundancy entitlement before the offer. The host’s day-to-day management must also respect those terms; putting payroll elsewhere does not make an underpayment lawful.

The provider generally needs the relevant labour-hire licence when the arrangement falls within Victoria’s or Queensland’s licensing law. As the client, use a licensed provider where required; buying an EOR service does not itself mean you need a provider licence.

Exclusions differ by state, so assess the actual arrangement and employing entity. Victoria changes its general definition from 1 October 2026; do not rely on an older exclusion analysis for later assignments.

The EOR withholds PAYG income tax from employee pay and pays the employer’s super obligation separately. From 1 July 2026, Payday Super generally requires contributions alongside wages, calculated at 12% of qualifying earnings, with receipt by the fund within seven business days unless an extension applies.

The quote should distinguish gross salary, employee tax deductions, employer super and the provider fee.

The super guarantee rate is 12% in 2026. From 1 July 2026, Payday Super applies to qualifying earnings and changes the payment timing to payday rather than the previous quarterly cycle.

For a straightforward A$100,000 annual salary fully within the contribution base, employer super is A$12,000. Eligibility, the maximum contribution base and the treatment of individual pay items still matter.

The Professional Employees Award is the starting point for a software engineer doing covered professional IT work, including covered labour-hire assignments. It is not decided by job title alone: duties, qualifications or equivalent experience, industry, another applicable award and managerial exclusions can change coverage.

Have the provider identify the award and classification in the offer review; paying a salary does not automatically make the role award-free.

Yes, NSW payroll tax can apply to EOR wages. Under the employment-agency rules, the agent is generally treated as the employer and taxable wages include employer super as well as salary.

Your own small team does not establish an exemption for the provider. Ask which employing entity bears the tax and how any threshold, grouping or valid client exemption affects the amount allocated to your invoice.

An illustrative NSW hire on A$100,000 salary costs A$118,104 before workers’ compensation, additional benefits and provider fees when full 5.45% payroll tax applies.

The arithmetic is A$100,000 salary + A$12,000 super + A$6,104 payroll tax on A$112,000. Adding an assumed A$800 monthly EOR fee gives A$127,704 before those remaining costs. This is a disclosed planning scenario, not a supplier quote or a claim that every employer pays the full rate.

Eligible EOR employees have the same unfair-dismissal protections as other employees in the national system. The usual minimum employment period is six months, or twelve months for a small-business employer with fewer than 15 employees; other eligibility tests also apply.

Count the actual employer under the statutory rules, not just your client team. Ending the client assignment does not by itself establish a fair reason or a compliant dismissal process.

Long service leave follows the applicable state law, industrial instrument or portable scheme, so an EOR cannot use one national default. Most Victorian employees can access it after seven years; the NSW statutory scheme ordinarily provides two months after ten years.

Earlier termination payments and interstate service need their own analysis. Preserve service records when changing provider or entity instead of assuming that a new payroll contract resets every entitlement.