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Australia has an excellent universal healthcare system called Medicare that is funded by the Australian government and through a Medicare levy taken from an employees salary annually. It is also possible for Australians to purchase private health insurance or have an employer contribute to one as a voluntary benefit.
Australia has a universal pension system which kicks in if an individual has not accrued a sufficient amount of superannuation over the course of their employment years. Employers in Australia are mandated by law to contribute an added 10.5% on top of an employee’s salary towards their superannuation fund. Public service workers are entitled to a higher rate of super contribution. It is possible for employees to organise a salary sacrifice arrangement with their employer in the case they want to contribute more on top of the mandated rate.
Disability contributions are not mandatory in Australia, however some companies do make contributions to different disability insurance schemes. The schemes include:
The average contribution will vary between companies with larger companies known to contribute higher rates towards one or a few of these schemes.
Employers also contribute a mandatory payment to the workers compensation scheme which covers employees that fall sick or get injured in the workplace. If an employee attains a disability from a workplace injury or illness, workers compensation will only cover up to a certain amount and timespan, then an employee will be eligible to receive payments either through Centrelink or through the National Disability Pension (NDP).
Employers and employees do not contribute to an unemployment payment. However, the Australian social security system provides income support to those who lose their job at any time, given they meet the eligibility requirements determined by the Department of Human services.
Hire borderless talent with Horizons
Your business can easily hire employees in Australia without opening a local entity. We handle local employment law, complex tax regulations, and international payroll in 180+ countries worldwide. All you need to do is focus on your business.
There are several mandatory employee benefits including Medicare, Superannuation contributions, workers compensation insurance for sickness or injury in the workplace.
Horizons can cover private health insurance contributions when hiring employees in Australia.
