Taking on your first employee is a milestone, and it's also the moment your admin gets more serious. The moment someone works for you, a set of legal obligations kicks in, and getting them wrong is expensive.
Here's what actually changes.
You have to pay super
On top of wages, you're required to pay superannuation, currently 12 percent of your employee's ordinary earnings, into their nominated fund. It's not optional and the ATO enforces it. Budget for it from the start rather than treating it as an afterthought.
You have to withhold tax
You collect PAYG withholding from each pay and send it to the ATO on your employee's behalf. That means registering for PAYG withholding and reporting through Single Touch Payroll every time you run a pay.
You need workers compensation insurance
The moment you have staff, you're required to hold workers compensation cover. The rules and cost vary by state, but skipping it isn't an option.
Fair Work sets the floor
Minimum wages, leave entitlements, and conditions are set by law and the relevant award. You can pay more, but you can't pay less or contract out of the basics. Getting the award classification right matters.
The bottom line
Hiring is one of the best signs your business is growing, but the compliance side has real teeth. Setting up payroll properly from day one saves you from backpay claims and ATO trouble later. It's worth getting the structure right before the first payslip goes out, not after.
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