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  • Squad 3: Taking on an employee

    This squad developed recommendations to help small business owners take on an employee.

    The priority problems we identified were that small business owners:

    • have to search many places to find the regulation that applies to them (no 'single source of truth')
    • lack confidence and certainty with awards
    • aren't certain whether a worker is an employee or contractor
    • aren't sure about what tax and super applies to specific payments.

    We've been working with various government agencies and intermediaries to implement the squad's recommendations. These are outlined in the table below.

    Squad recommendation


    1. Create a whole-of-government checklist covering the regulation requirements that apply when taking on an employee, including links to more information.

    Completed: Taking on an employee checklistExternal Link on

    2. Promote the pay and conditions tool to help users determine awards, classifications, rates of pay (including penalty rates and overtime), leave and termination entitlements, and add more functionality to the tool to make it even easier to choose an award and the right classification.



    3. Create a whole-of-government employee contractor decision tool to help small business employers find and meet the regulation requirements.

    Completed in part and closed: Work was already underway to include both PAYG withholding and superannuation guarantee in the one decision tool. The ATO's Employee/contractor decision tool now includes both of these elements.

    Relevant agencies are further exploring the possibility of aligning of employee/contractor definitions.

    4. Make it easier to find information about tax and super that applies to entitlements (for example, overtime meal allowance).

    Completed: Work out tax to withhold and super to pay.

      Last modified: 26 Apr 2017QC 47238