As you start business operations in a new market, you may need to think about adding new, specialized skills to your existing team. Whether you’re aiming to increase your speed to market, conduct market research, boost sales in a new location, or need to complete multiple short-term projects, bringing on contractors is an effective solution. They can offer unique expertise to meet these goals, without requiring the time and commitment of making permanent hires.
Before you can begin your search for contractors, you have to know where to look. Australia is a promising talent hub. It boasts a strong education system and a highly skilled workforce, particularly in finance, tech, and engineering. Many professionals have international experience, making them particularly successful in global roles. Plus, Australia’s time zone is ideal for companies in Europe and North America because it allows workforces to stay operating around the clock.
While finding and hiring the right contractors can be challenging, making sure you pay them securely and compliantly can be even harder. However, it doesn’t have to be – managing these obstacles gets a lot simpler with G-P. Our G-P Contractor solution lets you easily hire and pay contractors compliantly. If you’re looking to quickly tap into Australia’s talent, we’ve got all the information you need to make contractor payments straightforward and simple.
Where can you find and hire skilled contractors in Australia?
Entering the Australian market with contractors can help you quickly tap into the country’s exciting opportunities. However, if you want to increase your speed-to-market, you’ll need to know where to look. Here are some of the top destinations to hire contractors in Australia:
- Many talented financial contractors can be found in Sydney. The city hosts about 80% of all international banks in Australia. Plus, over 60% of the country’s fintech companies are housed there too.
- Melbourne is Australia’s leading tech city, with more than half of the country’s top 20 tech companies based there. Boasting over 1,800 tech-based startups, the region has skilled workers in software development, cloud computing, and cybersecurity.
- Perth, the largest city in Western Australia, plays a key role in the country’s engineering sector. It’s often called the mining capital of Australia because of its abundant natural energy resources, which has helped attract professionals with specialized skills in the energy sector.
- Adelaide thrives in advanced manufacturing, defense, automotive, and food production. With a strong focus on industry 4.0 practices like automation and smart manufacturing, Adelaide has built a network of contractors who are focused on creating and practicing innovative techniques.
- Canberra, the country’s capital, boasts top IT and cybersecurity talent, particularly in government and national security. With federal agencies like the Department of Defence and the Australian Cyber Security Centre (ACSC) nearby, Canberra draws in specialists who are well-versed in handling complex projects.
What are the key legal considerations when hiring contractors in Australia?
The Australian Taxation Office (ATO) provides guidelines to distinguish between contractors and employees. The ATO looks at several factors to ensure compliant worker classification. For example, employees get paid for the hours they work, and their pay comes as a set salary on a regular schedule. In contrast, contractors are not on a salary, but earn their money based on the specific results or projects they deliver.
Misclassifying workers as contractors instead of employees can cause serious problems in Australia. Hiring contractors can benefit a company by eliminating the need to provide benefits, termination notice, or severance pay. This can incentivize companies to classify employees as contractors. However, employers should be aware that under the Fair Work Act 2009, this is considered as sham contracting, which is illegal. Misclassification can cost a company over AUD 450,000 in back taxes and benefits.
What are the key factors to consider when paying contractors in Australia?
Australia has a pay-as-you-go (PAYG) system, which makes it easier for individuals and businesses to handle their taxes throughout the year. Sometimes, companies need to withhold tax from payments they make to contractors and send that money to the ATO. Contractors must then include those withheld amounts when they file their own taxes.
When paying contractors, a written agreement that clearly outlines the payment expectations will ensure everyone is on the same page. While contractors can choose to turn down unfavorable contract terms like a 90-day payment schedule, bigger companies usually have more leverage in negotiations. Fortunately, Australia’s Fair Work Act 2009 lets contractors look for help without worrying about backlash. The Independent Contractors Act 2006 is another worker protection in Australia that defends contractors from unfair contract terms.
For instance, if a contractor feels their contract is too unreasonable, they can contact the Federal Court of Australia. If the court decides a contract isn’t fair, it can change the terms, cancel the contract, or even order compensation.
It is also important to understand exchange rates as this can affect how much pay contractors actually take home. If you pay them in a currency other than the Australian dollar, they might get less than expected. With G-P Contractor, you can lock in real-time guaranteed quotes at the time of payment to avoid exchange rate fluctuations.
What are some methods for paying contractors in Australia?
When managing payment methods for Australia-based contractors, companies often choose to leverage a solution like G-P Contractor, as this helps maintain on-time payments in a flexible, transparent manner. Let’s take a look at some of the possible payment options in Australia, including EORs.
Banks
If your business registers in Australia, you must set up a corporate bank account to pay contractors. The registration process can be drawn out and complicated.
Global wire transfers
If you want to send money internationally, consider using a global wire transfer service through your bank. It’s a straightforward way to connect with banks worldwide and send your payments quickly. However, it can get pricey, with high bank fees and exchange rates that add up.
International money orders
International money orders provide a reliable way to send money. That said, they can be a bit slow and less convenient because you have to physically buy them and deposit them, which can take extra effort on both sides.
Digital wallets
Digital wallets like PayPal offer a quicker and easier way to send money compared to international money orders. While they don’t work everywhere, if you’re in a country that allows it, you can use digital wallets to send money to your contractors in Australia.
Cryptocurrency
In Australia, you can use cryptocurrencies like Bitcoin, though they aren’t considered legal tender. The government sees cryptocurrency transactions as barter deals. If your company works with cryptocurrency, keep in mind that the unfamiliarity may present challenges when it comes to taxes.
An Employer of Record (EOR) partner
Partnering with an EOR helps you hire and pay your Australia-based contractors most effectively. The EOR helps ensure contractor payments are accurate and timely. For example, G-P Contractor has built-in Wise technology, meaning you can make instant payments in over 50 currencies to contractors in over 180 countries via a digital wallet, ACH transfer, bank transfer, wire transfer, or credit card. Simply approve the invoice, select the currency, review the payment quote, and finalize the payment.
Hire and pay contractors in Australia with G-P today.
Many companies hire contractors instead of full-time employees to quickly access skills vital for success in global markets. Australia is an ideal choice due to its skilled workforce with international experience.
While there are many ways to pay contractors in Australia, teaming up with an experienced partner that can offer a reliable payment system is essential to attract and retain talent. Contractors value companies that deliver easy and consistent on-time payments. With G-P’s Contractor offering, you can seamlessly facilitate smooth payments between your company and your talent.
Contact us today to learn how to hire and pay contractors compliantly.
