Industrial laws have created different types of employees. It is important that you hire the type of employee that best suits your business. Proper legal and accounting advice can assist you to decide.
Each type of employee is entitled to different pay and conditions and your ability to terminate each employee varies.
Different types of employees
The different types of employees are:
A permanent employee who works 38 hours per week. The employee is entitled to all leave entitlements detailed in the National Employment Standards and any award.
A permanent employee who works regular and consistent hours that are less than 38 hours per week. The employee accrues leave entitlements on a pro-rata basis.
A non-permanent employee who works sporadic and unpredictable hours. The employee can decline work or shifts and receives a casual loading in place of leave entitlements.
- Fixed term
A permanent employee employed for a fixed term, such as 12 months, or a fixed task, such as a project. Employment ends at the end of the term or task. During the fixed term, the employee accrues leave entitlements.
A permanent employee (either full-time or part-time) who works shifts and receives a shift work allowance according to an award. The employee is entitled to all leave entitlements.
- Daily hire/Weekly hire
A particular type of fixed term employee created by legal Awards.
A full-time or part time employee also studying a trade qualification.
There is also another arrangement for consideration which is an independent contractor arrangement. Independent contractors work for themselves, not you and can sometimes be referred to as freelancers or consultants. They Key features of being an independent contractor include that the person can work for multiple businesses at once, often works on a short-term or per-project basis, can sub-contract their work, negotiate their own fees, working arrangements and are responsible for paying their own superannuation and tax.
How do I know which type of employment is the right one?
Growing your business and hiring new staff can be an exciting time but you should carefully consider the correct structure. You can get help from lawyers & accountants, the relevant industry body, or by contacting Fair Work Australia: https://www.fairwork.gov.au/