US company hiring in Australia

On this page (7 sections)

Overview
United States and Australia at a glance
The differences that matter most
Common compliance traps
How an EOR works for US companies in Australia
FAQs
Sources

USDLocal currency

Washington, D.C.Capital

Six time zones from Hawaii to the East Coast, 14 to 19 hours behind SydneyTime difference

Overview and why companies expand from the United States to Australia

Australia is an English-speaking, high-income market with strong demand for US software and services.
An Australian team can cover Asia-Pacific business hours and support customers while the US sleeps.
Australian talent in tech, sales and customer success is well regarded and works in a familiar business culture.
Many US companies use Australia as a base before expanding into New Zealand and South-East Asia.

For US employers, the biggest adjustment is moving from a system built on at-will employment and employer-designed benefits to one built on statutory minimums. In Australia, paid leave, retirement contributions, notice and protection from unfair dismissal are set by law, and most employees are also covered by a modern award that sets their minimum pay and conditions.

The good news is that the rules are clear, well documented and consistent across the country for most employment matters. Payroll tax, workers' compensation and long service leave are the main areas where state rules differ.

United States and Australia at a glance

Summary only. Figures were checked against the official sources listed below on 2026-10-08. Many rules depend on the employee's award, contract, state or province.
Topic	United States	Australia
Employment contracts	Employment is "at will" in every state except Montana, so either side can usually end it at any time for any lawful reason. Written contracts are uncommon below executive level; an offer letter is the norm. Every new hire must complete Form I-9.	A written contract is not legally required but is standard practice. Employers must give every new employee the Fair Work Information Statement, plus the Casual or Fixed Term Contract Information Statement where relevant. A modern award or enterprise agreement usually sets minimum terms. Fixed-term contracts are generally limited to 2 years or 2 consecutive contracts.
Probation	No statutory probation. Because employment is at will, probation has little legal effect, except in Montana where a probationary period applies under state law.	No statutory probation. In practice the unfair dismissal "minimum employment period" works as one: 6 months, or 12 months for small businesses with fewer than 15 employees.
Working hours	No federal cap on adult working hours. Under the Fair Labor Standards Act non-exempt employees earn 1.5 times their regular rate after 40 hours in a workweek. Some states, such as California, add daily overtime.	Maximum 38 ordinary hours a week plus reasonable additional hours under the National Employment Standards. Awards set overtime rates. Employees have a right to disconnect outside working hours unless refusing is unreasonable.
Minimum wage	Federal minimum wage of $7.25 an hour. Many states and cities set higher rates, and the higher rate applies.	National Minimum Wage of $26.44 an hour ($1,004.90 a week) from 1 July 2026. Most employees are covered by a modern award with higher minimum rates for their classification.
Annual leave	No federal right to paid vacation. Paid time off is set by employer policy and is a key part of a competitive offer.	4 weeks paid annual leave a year for full-time employees (5 weeks for some shift workers), accruing progressively. Untaken leave is paid out on termination. Many awards add a 17.5% leave loading.
Sick leave	No federal paid sick leave requirement for most private employers, but a growing number of states and cities mandate it.	10 days paid personal/carer's leave a year for full-time employees, plus 2 days unpaid carer's leave and 2 days paid compassionate leave per occasion. All employees can also take 10 days paid family and domestic violence leave a year.
Parental leave	The Family and Medical Leave Act gives eligible employees of employers with 50 or more employees up to 12 weeks of unpaid, job-protected leave. Several states run paid family leave programmes.	Up to 12 months unpaid parental leave after 12 months of service, with the right to request 12 more. The government funds up to 26 weeks of Parental Leave Pay at the national minimum wage from 1 July 2026, paid through Services Australia rather than the employer.
Public holidays	There are 11 federal holidays, but private employers are not legally required to give them off or pay a premium for working them.	National public holidays such as New Year's Day, Australia Day, Good Friday, Easter Monday, Anzac Day, Christmas Day and Boxing Day, plus state and territory holidays. Employees who work on a public holiday are usually paid penalty rates under their award.
Retirement and social security	Social Security tax of 6.2% each for employer and employee on wages up to $184,500 (2026), plus Medicare of 1.45% each with no cap. No mandatory employer pension, although some states require access to a payroll savings scheme.	Superannuation Guarantee of 12% of qualifying earnings, paid by the employer on top of wages. Since 1 July 2026 super must be paid each payday and reach the fund within 7 business days (Payday Super). There is no separate employer social security levy.
Payroll taxes	Employers pay federal unemployment tax (FUTA) and state unemployment insurance, and withhold federal, state and sometimes local income tax. Registration is needed in every state where employees work.	Employers withhold PAYG income tax from wages. Each state and territory charges payroll tax once total Australian wages pass a threshold, for example 5.45% above $1.2 million in NSW and 4.85% above $1 million in Victoria. Workers' compensation premiums are also payable.
Notice periods	No statutory notice for individual at-will terminations. The WARN Act requires 60 days notice of plant closings and mass layoffs for employers with 100 or more employees.	Employer notice under the National Employment Standards: 1 week (up to 1 year of service) rising to 4 weeks (over 5 years), plus 1 week if the employee is over 45 with at least 2 years of service. Pay in lieu is allowed. Awards set employee notice.
Dismissal protection	At-will dismissal is allowed, but not for discriminatory or retaliatory reasons under federal laws such as Title VII, the ADA and the ADEA, or under state laws.	Unfair dismissal protection applies after the minimum employment period to employees covered by an award or agreement, or earning under the high income threshold of $190,100 (from 1 July 2026). General protections against adverse action apply from day one. Small businesses can follow the Small Business Fair Dismissal Code.
Severance	No federal severance requirement. Severance is often paid in exchange for a signed release of claims.	Statutory redundancy pay of 4 weeks (1 to 2 years of service) rising to 16 weeks (9 to 10 years), then 12 weeks at 10 years or more, when long service leave usually takes over. Small businesses with fewer than 15 employees are generally exempt.
Mandatory benefits	Workers' compensation and unemployment insurance are compulsory. Under the Affordable Care Act, employers with 50 or more full-time equivalent employees must offer affordable health cover or risk a penalty.	Superannuation, workers' compensation insurance (state-based and compulsory), paid leave under the National Employment Standards and long service leave under state and territory laws, usually after 7 to 10 years of service.
IP and restraint clauses	Non-compete enforceability depends on the state. California, Minnesota, North Dakota and Oklahoma largely ban them. A 2024 Federal Trade Commission rule banning most non-competes never took effect. Invention assignment agreements are standard.	Post-employment restraints are only enforceable if reasonable to protect a legitimate business interest. Employers generally own IP that employees create in the course of employment. The federal government has proposed banning non-compete clauses for employees under the high income threshold from 2027; this was not law at the last review.
Visas and right to work	Every hire needs I-9 verification. Sponsored routes include the H-1B (lottery-based) and the E-3 visa, which is reserved for Australian citizens in specialty occupations.	Every worker needs Australian work rights, which employers can check through VEVO. Sponsored skilled hires generally use the Skills in Demand (subclass 482) visa, which needs an approved sponsor. Some EORs can sponsor, many cannot.

The differences that matter most

No at-will employment

In the United States, most employment can be ended at any time for any lawful reason. In Australia, employers must give notice or pay in lieu under the National Employment Standards. Once an employee passes the minimum employment period (6 months, or 12 months for small businesses), they can bring an unfair dismissal claim if the dismissal was harsh, unjust or unreasonable. That means having a valid reason, warning the employee and giving them a chance to respond.

Awards, not just a minimum wage

The US federal minimum wage is $7.25 an hour, with higher state and city rates. Australia's National Minimum Wage is $26.44 an hour from 1 July 2026, but most employees are covered by a modern award with higher rates, overtime and penalty rates. Exempt and non-exempt classifications don't translate directly: an Australian salaried employee can still be award-covered and entitled to overtime.

Leave is a legal right

US paid time off is a matter of policy. In Australia, full-time employees get 4 weeks of paid annual leave, 10 days of paid personal/carer's leave and 10 days of paid family and domestic violence leave a year, plus public holidays. Unlimited PTO policies can work in Australia only on top of these minimums, and you must still track accrued annual leave because it is paid out on termination.

Super is on top of salary

The 12% Superannuation Guarantee is an employer cost on top of salary unless the offer clearly states a package including super. Make this explicit in offers to avoid disputes. Since July 2026, super must be paid each payday.

Benefits are different

Australia has a public health system (Medicare), so employer-sponsored health insurance is not expected, although some employers offer private health cover as a perk. There is no equivalent of COBRA, and no need for an ACA-style offer of cover.

Common compliance traps

Using a US offer letter. At-will statements, US governing law and PTO pools don't fit Australian law. Use an Australian contract.
Missing award coverage. Check the award before setting pay, even for well-paid roles.
Forgetting super in budgets. Budget 12% on top of salary.
Recording leave loosely. Accrued annual leave is a legal liability and must be paid out when employment ends.
Calling across time zones. The right to disconnect means late-night US calls should be scheduled reasonably and be part of the role's agreed expectations.
Restraint clauses. US-style non-competes face a high bar in Australia, and the government has proposed banning them for most workers.

How an EOR works for US companies in Australia

An EOR with an Australian entity becomes the legal employer of your hire. In practice:

You choose the candidate and agree salary, start date and role.
The EOR issues an Australian employment contract, identifies the award and classification and provides the Fair Work Information Statement.
The EOR runs payroll in AUD, withholds tax, reports through Single Touch Payroll and pays super each payday.
You receive a monthly invoice covering salary, super, payroll tax and insurance pass-throughs and the EOR fee.
You manage the employee's day-to-day work. Pay changes, leave approvals that affect payroll and any termination go through the EOR.

When your Australian team grows, you can register an Australian subsidiary and transfer employees across. See EOR vs setting up an Australian entity.

Frequently asked questions

Is there at-will employment in Australia?

No. Australian employees are protected against unfair dismissal once they complete the minimum employment period, and general protections against adverse action apply from the first day. Employers must give notice or pay in lieu, and follow a fair process.

Do I have to give Australian employees paid vacation?

Yes. Full-time employees are entitled to 4 weeks of paid annual leave a year under the National Employment Standards, plus paid personal/carer's leave and public holidays. Unused annual leave is paid out when employment ends.

What is superannuation and how is it different from a 401(k)?

Superannuation is Australia's compulsory retirement savings system. Employers must contribute 12% of qualifying earnings to each employee's fund, on top of salary unless agreed otherwise, and since 1 July 2026 must pay it each payday. Unlike a 401(k) match, it is mandatory and doesn't depend on the employee contributing.

Can I offer stock options to Australian employees?

Yes. Australia has employee share scheme tax rules, including a start-up concession for eligible companies. Get Australian tax advice before granting equity, as the timing of tax can differ from US rules.

Can a US company hire an Australian as a contractor?

Only if the person is genuinely running their own business. Australian law looks at the real substance of the relationship. A full-time "contractor" who works only for you, on your schedule, is likely to be an employee.

How does an EOR help a US company hire in Australia?

The EOR employs your hire under an Australian contract, runs payroll, withholds tax, pays super and holds workers' compensation insurance. You direct the work and pay a monthly invoice in USD or AUD, with no need to register an Australian entity.

Sources

Last reviewed: 2026-10-08

Figures on this page were checked against these official sources on 8 October 2026. Rates and thresholds change, often on 1 January, 1 April or 1 July, so confirm current figures before relying on them.

New to the model? Start with what an Employer of Record is, then compareEOR costs and pricing models.

Hiring in Australia as a US company