Employee legal entitlements FAQs
Below are FAQs on legal entitlements. Your employees may have other legal entitlements. This is a complex area and you may need legal advice.
1. Do we need to pay superannuation?
Yes. Your organisation must make superannuation contributions for all employees (whether full time, part time or casual) aged between 18 and 69 and paid $450 or more (before tax) in a calendar month.
Your organisation may be required to make superannuation contributions for employees under 18 who work more than 30 hours per week under the Superannuation Guarantee Charge Act 1992 (Cth).
For more information go to:
2. What are our occupational health and safety obligations to employees?
Your organisation has a legal duty to take care to avoid exposing employees to likely risks of injury.
In Victoria, organisations that have at least one employee, trainee or apprentice, also have a duty under occupational health and safety (OHS) laws to provide a safe working environment and safe practices and systems of work.
If your organisation falls under these laws, you will owe that duty to all people at the workplace, regardless of their status there.
You must ensure that your workplace and any machinery and facilities used are safe, and that all workers have adequate training and supervision.
PilchConnect has produced comprehensive information on occupational health and safety:
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3. What sort of insurance do we need for our employees?
If your organisation's annual financial payroll is expected to be more than $7500 a year, you will be required to take out workers' compensation insurance to cover the organisation's employees.
For information on these obligations go to:
Depending on your activities and functions, your organisation may also be required to take out public liability and professional indemnity insurance to cover your own liability to employees, and the liability of your employees to other people.
PilchConnect has produced comprehensive information on insurance:
4. What are our tax obligations to employees?
You must provide a new employee with a Tax File Number declaration form, which you both need to complete. You must forward the completed original to the ATO within 14 days of the employee’s start date.
Your organisation, like any employer, must withhold income tax from wage payments to employees (PAYG withholding) each pay period. Your organisation must then provide this tax to the Australian Taxation Office (ATO).
For more information go to:
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You may wish to read the overview, complete the checklist and use the tax withheld calculator to work out how much tax you need to withhold from payments you make to your employees and other workers each pay period (week, fortnight or month).
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Other taxes, like fringe benefits tax, might also apply to your employees and, depending on the size of your organisation and the total remuneration paid in its payroll, you might also be liable to pay payroll tax to the State Revenue Office.
Beware: Some not-for-profit community organisations are eligible for an exemption from paying income tax. This means the organisation does not have to pay tax on any income that comes into the community organisation (for example, on money received as part of a grant).
This exemption only applies to the community organisation’s income tax liability - it does not mean that employees of the community organisation are exempt from paying income tax.
All employers are required to comply with the ATO's income tax withholding obligations in relation to payments of income to employees.
PilchConnect has more information on Tax and finance, go to:
5. What are our record keeping obligations?
You must make and keep accurate and complete records for all your employees, including the time worked and wages paid.
You must issue pay slips to each employee, you may wish to read the following:
PilchConnect has more information on document retention requirements, go to:
6. Are we legally required to protect employees from inappropriate behaviour (including bullying, sexual harassment and discrimination)?
Yes. Maintaining a workplace that is free from bullying, sexual harassment and discrimination is required by law and vital for the productivity and sustainability of your organisation.
The Equal Opportunity Act 2010 (Vic) applies to your organisation and its employees (including: full-time, part-time, casual and temporary employees and contract workers as well as job applicants, apprentices, trainees and those on probation).
The Victorian Equal Opportunity and Human Rights Commission (VEOHRC) has a self-audit tool and downloadable templates and checklists to help you implement equal opportunity good practice and manage specific employment issues. These toolkits focus on small businesses but apply to NFP community organisation too, go to:
7. Can our employees salary package because we are a not-for-profit organisation?
This depends on the tax status of your organisation.
Salary packaging arrangements are very attractive to employees because they allow the employee to have all or some of their salary paid in the form of benefits instead of salary. For example, an employee may choose to have their rent paid by their employer from their gross salary.
Your organisation will need the advice of a qualified accountant with FBT experience to review the FBT liabilities, if any, of your organisation and the salary packaging options available, if any, to your employees.
PilchConnect has produced information on fringe benefits tax, go to: