What do I have to do if I employ staff?

We are often asked what responsibilities businesses have when they employ staff. Below are the various responsibilities you are required to meet if you are in business and are employing staff. 

Pay and employees entitlements

The Fair Work Commission is responsible for the National Employment Standards and the national minimum wage. Employers must ensure that they are paying their employees correctly. Proper entitlements including sick leave, annual leave and long service leave need to be provided and tracked for the employees. More information on the employee’s entitlements can be found at the following website: https://www.fairwork.gov.au/employee-entitlements/national-employment-standards.  

It is also a legal requirement to provide employees with payslips for the relevant pay period.  

Safe Workplace

Employers are legally required to maintain a safe workplace and ensure the health and safety of their employees. This can sometimes be very difficult for employers to manage when the employees are working from home. The regulations are different in each state but there are penalties for not meeting your WHS obligations. For more information please go to https://www.safeworkaustralia.gov.au. 

Pay As You Go Withholding (PAYGW)

Employers must deduct PAYGW tax at source from employee’s wages and send the tax for all employees to the tax department (monthly if tax is over $25,000 pa, quarterly if < $25,000).  Payment summaries must be completed and given to employees within 14 days of year end or when they leave your employment. 

Payroll Tax

A state government tax levied on employers’ payrolls greater than $750,000 (in NSW).  Tax is 5.45% for every dollar of wages above $750,000 pa, usually charged monthly.  Contractors even set up as a company, can be included as “wages” for payroll tax purposes. Please note superannuation contributions are also included in wages for payroll tax purposes. 

Worker’s Compensation Insurance

All employees are required by law to be insured by the employer against injury occurring at work.  This should be organized through an insurance broker.  Rates vary depending on risk involved in the  job. 

Superannuation Guarantee

By law employers are required to pay superannuation on behalf of most of their employees.  At 1 July 2017 the rate to be paid is 9.5% of the employee’s wage.  From this date the contributions must be forwarded to the fund on a quarterly basis. 

Fringe Benefits Tax (FBT)

When an employer provides any benefit to their employee in place of salary or wages, FBT may be payable.  Common fringe benefits are motor vehicles, car parking, low interest loans and discounted goods.  There are some tax advantages available for certain concessionally taxed fringe benefits.  Most fringe benefits must be reported on an employee’s payment summary each year. 

Should you have any questions or would like to know more please do not hesitate to contact us.