Contracts

Hurray and congratulations you've been hired! You did so well in impressing them they're going to throw money at you in exchange for you showing up and doing things.

You might encounter the 'Letter of Offer' and the 'Contract'. You need to read both of these carefully.

The 'Letter of Offer' spells it out formally that they're offering you a job and will include some basic information - all the stuff that you're interested in anyway - such as the salary, job title, where you'll be working etc. In Australia we work on a yearly salary basis so you'll see all the numbers relating to your salary calculated on a yearly basis. If you are only needed for a 6 month period then they'll adjust your pay according to what they would have paid you had you worked the full year.

Other terms we use could be Total Remuneration Package or $XX,XXX p/a (which stands for per annum).

The 'Contract' will include all the legal clauses and perhaps some company policy as well such as dress code or code of conduct.

It should list out your benefits and common scenarios and what will happen if they arise.

Contracts come in all different sizes and formats and funnily enough, not standard. Some companies write it up on a piece of paper, other companies have 20 page documents. Whether it's a small or a long contract, read every single word carefully.

You don't want to be taken advantage of and certainly not in a foreign country where you want to make a new life for yourself.

Anything that looks suspicious or something that doesn't sit right with you ask someone!

Ask the employer. Ask your friends. Ask us! (why not?)

TFN vs ABN

What are these acronyms and why are they important? Taxes, duh!

A Tax File Number is a number unique and personal to you that you give out to your banks, superannuation funds, employer and whoever collects taxes on your behalf. This lets them know the appropriate amount of tax to take out of your salaries so you should definitely give them this.

Don't have one? Well don't panic, you can easily get this online here.

But wait, has someone asked for your ABN? Then you might have just been hired as contractor or freelancer rather than an employee.

The difference between the two is the responsibility that the employer needs to take on when hiring you.

If you are an employee then you use a TFN and the employer does everything else.

If you're a contractor or freelancer and you use an ABN then you're invoicing your employer for the services you do. You're responsible for your own taxes, super and everything else under the sun because you are now operating as a 'sole trader' and thus self-employed. Generally you're paid more if you work as a contractor or freelancer to make up for the costs that you have to carry instead of your employer.

This ABN-freelancer-contractor route is common amongst smaller companies and for temporary foreign workers. This isn't illegal but you need to consider how the situation will affect you.

As an employee you are protected by employment and labour laws such as being fired, right to annual leave, right to sick leave etc. But as a freelancer contractor then you can get 'fired' at any time because technically you're a self employed person providing services. You're also not entitled to sick leave or annual leave.

ABN's can be obtained online here.

Bank accounts

If you're new to the country you're not expected to open up a bank account immediately, but at some point you might want to stop using your credit cards or bank cards to take money out. You will need a bank account to start receiving your Australian salary.

Setting up a bank account is extremely easy and can be done online with in-branch verification or go directly to a bank of your choice and set one up. Easy as pie!

Then give this to your employer so they know where to send all that hard earned cash.

Direct debit paid monthly or fortnightly into your bank account is common practice in Australia and you won't find too many, if any, still using cheques.

If your industry lends itself to it then you may be paid in cash. For example, hospitality or if you work in a bar and get the tips.

Superannuation funds

You might notice that jobs are advertised 'including super' or 'excluding super'. What is this 'super' that everyone speaks of? It's Australia's very own retirement and pension scheme. Every working Australian has a bit of their salary taken out and put in an account somewhere to save for a rainy day. Your employer is required by law to take out 9.25% of your pay and put it in an approved superannuation fund of your choosing.

So firstly, make sure the salary that you're getting distinguishes between including or excluding super.

Secondly, don't fret if you don't have a superannuation fund of your choosing. You're given the choice by law but employers also use their own companies for superannuation funds. If you don't have one in mind or don't want to choose then just go with the company that your employer uses. You always have the flexibility to change super funds, particularly as you can just rollover from fund to fund online.

And finally, don't worry about this money just yet, it's not a tax, its a giant savings account for you. When you leave Australia you'll get it back. Read our post on how to get your superannuation back.

Other news...

Have you checked out the Australian Partner Visa Guide?