Hiring employees in Australia has always required international companies to understand more than salaries and recruitment.
Employers also need to consider Australian payroll, tax withholding, employment conditions, superannuation and HR administration.
Since 1 July 2026, there is another important factor to include in that equation: Payday Super.
Under the new system, employers are required to pay Superannuation Guarantee contributions in connection with each payday rather than following the previous quarterly payment cycle. Contributions generally need to reach the employee's superannuation fund within seven business days after payday, subject to applicable exceptions. The Superannuation Guarantee rate is currently 12%.
For an international company planning its first Australian hire, the change raises an important question:
How should Payday Super be factored into the cost and structure of employing people in Australia?
Payday Super is Australia's new approach to the payment of compulsory employer superannuation contributions.
Before 1 July 2026, employers generally paid Superannuation Guarantee contributions quarterly.
Since 1 July 2026, employers must make super contributions in connection with each payday.
The reform is designed to give employees access to their super contributions sooner and improve the visibility of unpaid or incorrect contributions.
For employers, however, it also means that superannuation is now much more closely connected to the regular payroll process.
This matters particularly for international companies that are establishing an Australian workforce for the first time.
When an international company calculates the cost of hiring an employee in Australia, salary is only one part of the equation.
A company may also need to account for:
Payday Super does not necessarily create a new employment cost by itself. The Superannuation Guarantee already existed.
What changes is when the contribution is paid and how closely it needs to be integrated with payroll.
For an international company, this distinction is important.
The issue is not simply:
“How much will we pay our employee?”
It is:
“What will it take to employ and manage this person compliantly in Australia?”
The Superannuation Guarantee rate is currently 12%.
For example, if an employee has $100,000 of remuneration that is subject to the Superannuation Guarantee, the employer's super contribution would generally be $12,000.
That means the employer should understand whether the salary being discussed with a candidate is:
This distinction can significantly affect how an international company calculates its employment budget.
Suppose an international company plans to hire an Australian employee on a package described as:
$100,000 + super
The company would generally need to budget for the $100,000 salary plus the applicable 12% super contribution, before considering other employer costs.
That is different from a package described as:
$100,000 inclusive of super.
The precise treatment of remuneration should always be confirmed based on the employee's circumstances and applicable employment arrangements.
For international companies, one of the most useful ways to think about Payday Super is as part of the total employment cost.
Consider a company hiring a sales manager in Sydney.
The company might initially focus on:
Base salary: $120,000
But its employment budget may also need to consider:
Superannuation: 12% where applicable
plus:
This is why salary benchmarking alone is not enough when planning an Australian expansion.
An international company should understand the fully loaded employment cost before deciding how many people it can afford to hire.
For an Australian company with an established payroll team, Payday Super is primarily a process change.
For an international company operating its payroll from overseas, the challenge can be greater.
The company may need to coordinate Australian payroll with systems located in:
This can create questions around:
The more complex the approval chain, the more important it becomes to have a clearly defined local payroll process.
This is where the issue becomes particularly relevant for companies entering Australia.
Imagine a French company wants to test the Australian market.
It decides to hire one business development manager in Sydney.
The company may not yet have:
Yet it still needs to manage the employment correctly.
The company therefore has several strategic questions to answer:
Who will employ the person?
Who will run payroll?
Who will manage superannuation?
Who will handle local HR administration?
Who will ensure the appropriate Australian employment conditions are applied?
For a first hire, building all of this infrastructure internally may not be efficient.
This is one reason international companies consider an Employer of Record.
An Employer of Record can provide a local employment structure for international companies hiring in Australia.
Under an EOR model, the EOR is the legal employer of the employee and manages agreed employment administration, including payroll and applicable statutory employment obligations.
For the international company, this can simplify the operational side of employing an Australian worker.
Instead of establishing a complete local payroll infrastructure for one employee, the company can work with a provider that already operates within the Australian employment framework.
The exact services and responsibilities depend on the EOR agreement.
For international companies, the key benefit is not simply payroll processing.
It is having a local employment infrastructure in place from the beginning.
An EOR is not the only option.
If a company already has an Australian subsidiary, its employees can generally be employed directly by that local entity, subject to the applicable requirements.
In that situation, the subsidiary needs an appropriate payroll and HR setup capable of handling:
The company can manage these functions internally or outsource some or all of them to a specialist provider.
This means Payday Super can be relevant under both employment models:
EOR → local employment infrastructure managed through the EOR
Australian subsidiary → payroll and HR managed by or for the subsidiary
The question is therefore not simply whether Payday Super applies.
The more strategic question is:
Who is responsible for managing it?
For French companies, Australian expansion often begins with a relatively small local team.
The first hire may be:
At this stage, the company may still be assessing the market.
An EOR can allow the company to start hiring locally without immediately building a full Australian corporate and HR infrastructure.
As the Australian business grows, the company can then reassess whether establishing its own subsidiary is appropriate.
This creates a potential progression:
Market research → First local hire → EOR → Growing team → Australian subsidiary
The appropriate path depends on the company's commercial objectives and circumstances.
Payday Super does not change the fundamental objective of recruitment: finding the right person for the role.
But it reinforces the importance of understanding the complete employment package.
When comparing candidates, international companies should consider more than the headline salary.
For example:
$100,000 + super
$110,000 package inclusive of super
These figures cannot be compared directly without understanding what is included in each package.
For international HR teams unfamiliar with Australian compensation structures, local recruitment expertise can therefore be valuable.
The recruitment process should establish clearly:
This helps the company calculate its actual employment cost before making an offer.
A useful Australian hiring budget can be divided into several categories.
The employee's salary and other agreed compensation.
The applicable Superannuation Guarantee contribution.
The cost of running compliant Australian payroll.
Employee administration, policies, onboarding, leave and ongoing HR support.
Search, advertising, recruitment agency or local talent acquisition costs.
Depending on the employee and structure, this may include workers' compensation and other applicable employer obligations.
For companies operating through their own Australian entity, accounting, tax, corporate administration and other subsidiary costs may also apply.
This is why comparing an Australian employee's salary directly with the salary of an employee in France, the UK or India can produce a misleading picture of the total cost.
If an international company is outsourcing Australian payroll, it should understand exactly how its provider handles the new requirements.
Useful questions include:
Ask how the provider determines the applicable contribution for each employee.
Understand how the provider's payment schedule aligns with payday and the applicable fund-receipt deadline.
A payroll provider should have a clear process for identifying and correcting unsuccessful contributions.
Understand what information is reported and when.
Incorrect employee or superannuation fund information can create operational problems.
The company should have a clear understanding of which responsibilities sit with the employer and which are handled by the payroll provider.
These questions are particularly important when the company's finance team is located outside Australia.
For international companies, Payday Super should be considered within the broader employment strategy.
A business entering Australia needs to connect several decisions:
Where will we hire?
↓
Who will we hire?
↓
Who will legally employ them?
↓
How will payroll work?
↓
How will superannuation be managed?
↓
Who will manage HR?
↓
Do we need our own Australian subsidiary?
The answers can change as the Australian operation grows.
A company with one employee may have very different needs from a company with 20 or 50 employees.
That is why the employment model should be reviewed as part of the wider expansion strategy.
An EOR may be worth considering when a company:
An EOR can provide a bridge between international expansion and local establishment.
It does not necessarily mean the company will never create an Australian subsidiary.
For some businesses, the EOR becomes an initial market-entry solution while the company evaluates its long-term plans.
As an Australian operation grows, the company may decide that direct local operations make more sense.
Factors may include:
At that stage, establishing a subsidiary can provide the company with a direct Australian operating structure.
The subsidiary can then employ staff directly while the company builds its local HR, payroll, accounting and administrative infrastructure.
Payday Super is one part of a much broader question:
How do you build and manage an Australian workforce when your headquarters is overseas?
Expandys supports international companies across several stages of this process.
Find and recruit local Australian talent based on the company's role, sector and expansion objectives.
Employ Australian talent through an EOR structure when establishing a subsidiary immediately is not the preferred approach.
Support the ongoing administration of Australian employees, including payroll and HR processes.
For companies ready to build a permanent Australian presence, Expandys can support subsidiary establishment and the operational infrastructure required to run it.
This allows companies to approach Australian expansion as one connected process rather than managing recruitment, employment, payroll and corporate administration separately.
What is Payday Super? Payday Super is Australia's system requiring employers to pay Superannuation Guarantee contributions in connection with each employee payday.
When did Payday Super start? Payday Super commenced on 1 July 2026.
What is the superannuation rate in Australia in 2026? The Superannuation Guarantee rate is 12%.
Do employers have to pay super on the same day as salary? The system links superannuation to each payday, but contributions generally need to reach the employee's super fund within seven business days after payday, subject to applicable exceptions.
Does Payday Super increase the cost of hiring an employee? The Superannuation Guarantee itself is an existing employer obligation. Payday Super primarily changes the timing and administration of contributions. However, companies should include applicable superannuation and payroll administration in their overall employment-cost calculations.
Does Payday Super apply to international companies? If an international company has employees in Australia and has Australian Superannuation Guarantee obligations, Payday Super can form part of its Australian payroll responsibilities.
Can an EOR manage Australian superannuation? An EOR can manage agreed payroll and employment administration, including applicable superannuation obligations, as part of its service. The exact responsibilities depend on the EOR arrangement.
Does a company need an Australian subsidiary to hire employees? Not necessarily. An EOR can provide a local employment structure for companies that want to hire in Australia without immediately establishing their own subsidiary, subject to the applicable circumstances.
Should companies include superannuation when calculating Australian salary costs? Yes. Companies should understand whether a quoted salary is plus super or inclusive of super, because this affects the total employment cost.