- 1
Scope and quote
You tell the EOR the role, location, salary and start date. The EOR identifies the right modern award (or confirms the role is award-free), estimates on-costs and sends a quote showing salary, superannuation, payroll tax, workers' compensation and its fee. Ask for every line item, not just a monthly total.
- 2
Service agreement
You sign a service agreement with the EOR. It covers fees, invoicing, any deposit, liability, intellectual property, confidentiality, notice periods and what happens if you want to move the employee to your own entity later.
- 3
Offer and contract
The EOR issues the employment contract in its own name. It must give the new employee the Fair Work Information Statement, and the Fixed Term Contract or Casual Employment Information Statement where relevant. You agree the contract terms with the EOR first, including title, duties, hours, probation and any bonus.
- 4
Checks and onboarding
The EOR confirms the person's right to work (for visa holders, usually through VEVO), collects a tax file number declaration and the employee's choice of super fund, sets up payroll and adds them to its workers' compensation policy. You handle equipment, system access and the induction into your team.
- 5
Monthly cycle
The employee works for you. You approve timesheets (if needed), leave and expenses. The EOR pays wages, sends payslips within one working day of payday, reports through Single Touch Payroll, pays super with each pay under Payday Super and invoices you for the month.
- 6
Changes
Pay rises, new duties, a move interstate or parental leave all go through the EOR, which updates the contract and payroll. A move to another state can change payroll tax, workers' compensation and public holidays.
- 7
Ending employment
If the employee resigns, the EOR processes the notice and final pay. If you want to end the role, talk to the EOR before saying anything to the employee. It will check the reason, the process, notice and any redundancy pay, then manage the termination and final pay, including untaken annual leave.
How long does it take?
For an Australian citizen or permanent resident, many EORs can issue a contract within a few business days of signing the service agreement. Visa sponsorship takes much longer and not every EOR can sponsor. Leave a buffer before the start date for the contract to be reviewed and signed, and for equipment to arrive.
What you pay and when
Most EORs invoice monthly, either in advance or in arrears. Many ask for a security deposit, often equal to one or two months of employment cost, because they carry the legal obligation to pay the employee even if a client stops paying. Ask whether the deposit is refunded when the arrangement ends and how quickly.
Keeping it clean
The arrangement works best when everyone respects the line between host and employer.
- Do not promise the employee pay rises, bonuses or changes to their contract before the EOR agrees.
- Do not discipline or dismiss the employee yourself.
- Tell the EOR straight away about workplace injuries, complaints or performance problems.
- Keep your own records of the work and any performance conversations. They will matter if a dispute arises.
Frequently asked questions
Can I hire someone who already works for me as a contractor?
Yes. The EOR will employ them on a new contract. Agree how their prior service is treated, because it can affect leave and notice.
How is probation handled?
Australia has no statutory probation, but contracts often include one. The unfair dismissal minimum employment period of 6 months (12 months for small businesses) is what really matters. An EOR is usually not a small business employer, so 6 months is the period that normally applies.
Who pays for the employee's laptop?
Usually the host provides equipment directly. Some EORs can buy and ship equipment and invoice you for it.
