Hiring overseas employees from Australia

Can you hire overseas workers as a contractor from Australia?

Yes, you can engage someone overseas as an independent contractor, but the label on the contract won't decide it. For Fair Work purposes, most Australian companies have to judge the relationship by how it works in practice [1].

Since 26 August 2024, the Fair Work Ombudsman says, the test looks at "the real substance, practical reality and true nature" of the whole relationship [1]. Section 15AA of the Fair Work Act requires regard to how the contract is performed in practice, not only to its terms [2]. An ABN or invoices don't make someone a contractor on their own. The FWO weighs factors such as control over how the work is done, financial risk, who supplies the tools, the ability to delegate, hours of work and whether the work is expected to continue. Some sole traders and partnerships still use the older start of relationship test [1].

Two cautions. Telling a worker they are a contractor when the business doesn't reasonably believe it is sham contracting, and it is illegal. As listed by the FWO in October 2026, the maximum penalty is $546,000 per contravention for a business with more than 15 employees [3]. For tax and super, the ATO has its own guidance. It says the business is responsible for classifying the worker correctly [4], and that a contractor paid mainly for their labour is still owed super guarantee even if they quote an ABN [5].

The country where the person lives has its own rules too. Costa Rica's Labour Code, for example, presumes an employment contract exists between the person doing the work and the person receiving it, whatever the contract is called [6]. Get advice in both countries before you settle on a contractor arrangement.

Do super, PAYG and the Fair Work Act apply if your employee lives overseas?

Sometimes. It depends on where the person was engaged, where they do the work and whether they are an Australian resident [2] [5] [8], so check your own case with the ATO or a registered tax professional.

Fair Work Act. Someone employed by an Australian employer generally counts as an "Australian-based employee" wherever they are located. The Act carves out a person engaged outside Australia to perform duties outside Australia [2]. Where you hire someone and where they work can decide whether Australian workplace law reaches them.

Super. The ATO says you don't have to pay super guarantee for non-resident employees who work outside Australia. If you send an Australian employee to work overseas temporarily, you keep paying it [5]. Where super is owed, the rate has been 12% since 1 July 2025 [7], and from 1 July 2026 it is due for each payday [5].

PAYG withholding. For a foreign-resident employee working outside Australia, the ATO says withholding is unlikely unless the payments relate to entertainment, sports, construction or gaming junket activities. It can still be required in some cases, and the answer depends on the employee's own circumstances [8].

What is an employer of record in Australia, and how does it work?

"Employer of record" is a commercial term for a provider that employs a worker formally and runs their payroll while you direct the work. Fair Work Ombudsman guidance covers the closest Australian arrangement under the name labour hire [9].

In labour hire, the FWO says the labour hire business employs the worker and is responsible for their pay and entitlements, while the worker works for the host business [9]. The ATO says that when you take a worker through a labour hire firm, the firm is responsible for PAYG withholding, super and fringe benefits tax, and it will call your business the "host employer" [4]. The FWO also says businesses can be responsible if workers in their supply chain don't receive their minimum entitlements [9].

Those rules describe Australian labour hire firms. If a provider employs someone for you in another country, ask the provider and your own adviser which country's rules apply and who carries each obligation.

If you are weighing a contractor against an employer of record, settle first whether the role really is a contractor role (see the first answer). People First Advisory does not act as an employer of record, run payroll or supply staff. Katia finds and assesses the candidates. You choose the person and decide with your adviser how to engage them, directly or through a provider you pick.

Can we sponsor an overseas hire on the Skills in Demand (482) visa?

Possibly, if your business sponsors them and the role and the candidate meet the criteria. The Skills in Demand visa (subclass 482) lets an employer sponsor a skilled worker for a position it can't find a suitably skilled Australian to fill [10].

It replaced the Temporary Skill Shortage visa on 7 December 2024 [11]. There are three streams. Core Skills covers occupations on the Core Skills Occupation List, and the worker can work for the sponsor for up to 4 years [12]. Specialist Skills covers occupations outside ANZSCO Major Groups 3, 7 and 8 where the nominated salary meets the Specialist Skills Income Threshold [13]. Labour Agreement covers employers that have a labour agreement [14]. In each stream the candidate generally needs at least a year of relevant work experience [12] [13] [14]. The income thresholds are indexed, most recently from 1 July 2026 [12], so check the current figures with Home Affairs.

Sponsorship carries obligations. Home Affairs says you must keep the worker in the occupation you nominated, give them conditions no less favourable than an equivalent Australian worker, keep records, and pay all recruitment costs yourself, including recruitment agent and migration agent fees. A recruiter's fee is yours to pay, never the worker's [15].

In Australia, only registered migration agents and legal practitioners can lawfully charge for visa help [16]. Katia does not give visa or migration help. She can find and assess the candidate, and your migration agent or lawyer handles the visa.

Does Australia's Privacy Act apply when candidate details go overseas?

If your business is covered by the Privacy Act, yes. Before you send personal information to someone overseas, you must take reasonable steps to make sure they handle it in line with the Australian Privacy Principles, and you generally stay accountable if they don't. There are exceptions, set out in the OAIC's guidance on APP 8 [17].

Not every business is covered. The OAIC defines a small business as one with annual turnover of $3 million or less, and says most are not covered, though some are [18]. If you are covered, don't rely on the employee records exemption for recruitment. The OAIC says it doesn't extend to unsuccessful job applicants [19].

Katia works from San José, Costa Rica, so candidate details you share with her go overseas. Ask her, or any recruiter outside Australia, how candidate data is stored and who sees it, and get the answer in writing.

How many working hours does Sydney share with the Philippines, India or Latin America?

On a 9am to 5pm day at both ends, a Sydney team shares 5 to 6 hours a day with the Philippines, 2.5 to 3.5 with India, and 1 or none with Costa Rica in Central America. The figure moves with Sydney's daylight saving [20] [21] [22] [23].

Sydney and Melbourne run on AEST (UTC+10) and move to AEDT (UTC+11) from 2am on Sunday 4 October 2026 to 3am on Sunday 4 April 2027 [20] [21]. The Philippines is on UTC+8 all year and India on UTC+5:30, with no daylight saving [22]. Costa Rica is on UTC-6 all year [23].

• Philippines: 5 hours from October to April (noon to 5pm Sydney time) and 6 hours from April to October (11am to 5pm).
• India: 2.5 hours from October to April (2.30pm to 5pm Sydney time) and 3.5 hours from April to October (1.30pm to 5pm).
• Costa Rica: 1 hour from October to April (9am to 10am Sydney time, which is 4pm to 5pm the previous day in San José) and none from April to October.

Sydney's Monday morning is still Sunday afternoon in Costa Rica. A hire in Costa Rica for a Sydney team means working mostly asynchronously, or agreeing shifted hours on one side. Of these three, the Philippines fits a Sydney day best, and India gives you a shared afternoon. Katia recruits anywhere in the world, so the search can start from the hours the role needs.

Is Australia still short of skilled workers in 2026?

Yes, though less than in recent years. Jobs and Skills Australia's 2026 Occupation Shortage List, released on 21 October 2026, found 279 of 1,021 assessed occupations in national shortage, or 27% [24] [25].

That is down from 29% in 2025 and a peak of 36% in 2023. The gaps are uneven. Almost half of technician and trades occupations and 37% of professional occupations were assessed as in shortage, and 127 occupations have been in shortage continuously from 2021 to 2026 [24].

If your role sits in a shortage area, this page covers two options: hire someone who works remotely from another country, or sponsor someone to come here (see the visa answer above). Katia can run the search for either.

What does working with Katia look like for an Australian business?

You work directly with Katia, one to one, from the first call through to onboarding. Her background is in Human Resources, specialised in talent acquisition, and she recruits from junior to executive level anywhere in the world.

• She builds the role definition and candidate profile with you.
• She runs an active search, filters candidates and checks references.
• You get a shortlist of vetted candidates, not a pile of CVs.
• She supports you through the offer, negotiation and onboarding.

Roles she recruits include customer service, finance and accounting, IT and engineering, sales and marketing, human resources, operations and logistics, administrative, executive and leadership, and remote and nearshore roles. She works in English and Spanish.

Katia is based in San José, Costa Rica. At 9am in Sydney it is 4pm or 5pm the previous day there, depending on the season [21] [23], so an early Sydney call lands in her afternoon. The first conversation is free, and we usually reply the same day.

Sources

1. Fair Work Ombudsman, Whole of relationship test
2. Fair Work Act 2009 (Cth), ss 15AA and 35, Compilation No. 73 (Federal Register of Legislation)
3. Fair Work Ombudsman, Sham contracting
4. ATO, Difference between employees and independent contractors
5. ATO, When super guarantee is required
6. Costa Rica, Código de Trabajo, art. 18 (SINALEVI)
7. ATO, Super guarantee percentage
8. ATO, Withholding from a foreign resident employee
9. Fair Work Ombudsman, Labour hire and supply chains
10. Department of Home Affairs, Skills in Demand visa (subclass 482)
11. Department of Home Affairs, Temporary Skill Shortage visa (subclass 482), repealed
12. Department of Home Affairs, Skills in Demand visa, Core Skills stream
13. Department of Home Affairs, Skills in Demand visa, Specialist Skills stream
14. Department of Home Affairs, Skills in Demand visa, Labour Agreement stream
15. Department of Home Affairs, Sponsorship obligations for Standard business
16. Department of Home Affairs, Using a migration agent
17. OAIC, APP Guidelines Chapter 8: Cross-border disclosure of personal information
18. OAIC, Small business
19. OAIC, Employee records exemption
20. NSW Government, Daylight saving
21. IANA Time Zone Database, release 2026e, australasia
22. IANA Time Zone Database, release 2026e, asia
23. IANA Time Zone Database, release 2026e, northamerica (Costa Rica)
24. Jobs and Skills Australia, Occupation shortages continue to ease (21 October 2026)
25. Jobs and Skills Australia, 2026 Occupation Shortage List Key Findings Report