How to choose an Employer of Record

Updated 23 October 2026 · 2 min read

1. Is it really employing in Australia?

Some global providers employ Australian staff through their own local company. Others use a partner. Both can work, but you should know who signs the contract. Ask for the legal name and ABN of the Australian employing entity, and check it on the ABN Lookup register.

2. Licences and insurance

• Labour hire licences for Victoria, Queensland, South Australia and the ACT, if your employee will work there and the arrangement is covered.
• A current workers' compensation policy in the state where your employee works. Ask for the certificate of currency.
• Professional indemnity and public liability insurance.

3. Award and pay expertise

Ask the provider which award it thinks applies to your role and why. A confident, specific answer is a good sign. "We will work it out later" is not. Underpaying an award employee is the most common compliance failure in Australia, and as host you want to know it is being handled.

4. Payroll and super

• Does it run payroll in-house or through a subcontractor?
• Is it reporting through Single Touch Payroll?
• Is it paying super with every pay under Payday Super?
• How does it handle pay errors, and how fast?

5. Contract terms to read twice

• Notice period for ending the service agreement.
• Transfer or conversion fees if you move the employee to your own entity.
• Non-solicitation clauses that stop you hiring the employee directly.
• Liability caps and indemnities, especially for underpayment claims and unfair dismissal costs.
• Intellectual property assignment from the employee to the EOR and from the EOR to you.
• Deposit terms: amount, when it is refunded and whether it earns interest.
• Price increases: how much notice and how often.

6. Pricing transparency

A good EOR will show salary, super, payroll tax, workers' compensation and its fee as separate lines, and explain any difference between the quote and the first invoice. Be wary of a single bundled monthly figure.

7. Service and experience

• Who is the employee's point of contact for pay and leave questions, and in which time zone?
• How quickly does it respond to the employee?
• Can it support visa sponsorship if you need it later?
• What does the employee see: a portal, payslips, leave balances?

Red flags

• It will not name the Australian employing entity.
• It suggests treating the worker as a contractor "to save costs".
• It cannot say which award applies.
• It has no workers' compensation certificate for the relevant state.
• The quote is far below others with no clear explanation.
• It wants you to handle dismissals yourself.

Ready to talk it through? Send us your question and we will point you in the right direction.

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