Which employment law changes in 2026 matter for businesses with offshore teams?
Most 2026 changes apply to staff working onshore, but three reach offshore teams: the contractor tests that decide classification, Payday Super for any Australian-based staff, and the wage rules in the countries where your team works. Check each against how your offshore people are engaged.
This is general information, not legal advice. Whether a rule applies depends on who employs the person, which law governs the engagement and where the work is done.
What changed in Australia in 2026?
Mostly wages, superannuation and thresholds from 1 July 2026, on top of the contractor test that has applied since August 2024. Table 1 sets out the changes and whether they touch an offshore team.
Table 1: Australian employment law changes in and around 2026, and whether they touch an offshore team
| When | Change | Does it touch an offshore team? |
|---|
| 1 July 2026 | National minimum wage up 6% to $1,004.90 a week ($26.44 an hour); modern award rates up 4.75% | Onshore employees. The Fair Work Act generally excludes workers engaged outside Australia to work wholly outside it (section 35(3)) |
| 1 July 2026 | Payday Super: super must reach the employee's fund within seven business days of each payday (up to 20 business days in limited cases); the super guarantee charge adds an administrative uplift of up to 60% of the shortfall | Applies to eligible Australian employees. The ATO position is that super guarantee is not payable for a non-resident employee who does all their work outside Australia, but a contractor paid mainly for labour can still attract it |
| 1 July 2026 | High income threshold $190,100 (from $183,100); maximum unfair dismissal compensation $95,050 (from $91,550) | Onshore employees |
| 1 July 2026 | Parental Leave Pay rises from 24 to 26 weeks; weeks reserved for the second parent rise from three to four | Onshore employees |
| 26 August 2024 (still the main test) | Section 15AA whole-of-relationship test; section 357 defence needs a reasonable belief the engagement was a genuine contract for services; penalties up to $93,900 (individual) and $469,500 (company) per contravention | Central to classifying offshore contractors engaged by an Australian business. PAYG withholding and superannuation use separate tests |
| Proposed, intended 2027 | Draft ban on non-compete clauses for workers earning below the high income threshold | Not law. Review restraint clauses in offshore agreements if it is introduced |
Source: Legal 500 (McCabes), 2 July 2026; Baker McKenzie, 29 June 2026; Alvarez and Marsal on Payday Super (Royal Assent 6 November 2025, start 1 July 2026); Fair Work Act 2009; Pear Tree compliance notes. The national minimum wage is $26.44 an hour on a 38-hour week; one secondary source misprints the hourly figure. General information, not legal advice.
The Fair Work Act generally does not apply to a worker engaged outside Australia to perform all their duties outside Australia (section 35(3)), which is why most of the wage changes above stay onshore. The risk for offshore engagements sits in classification, and the section 15AA test, the reasonable-belief defence and the separate PAYG and superannuation tests still decide it.
A worker can classify differently under the Fair Work Act, the ATO's PAYG withholding rules and the super guarantee, because each uses its own test, and an ABN does not settle the question. Payday Super adds a timing risk for anyone caught by the super guarantee, because the deadline now runs from each payday rather than from quarter end.
What changed in New Zealand in 2026?
The Employment Relations Amendment Act 2026 reshaped contractor and dismissal rules from 21 February, followed by wage, KiwiSaver, health and safety and leave changes. Table 2 sets them out.
Table 2: New Zealand employment law changes in 2026, and whether they touch an offshore team
| When | Change | Does it touch an offshore team? |
|---|
| 21 February 2026 | Employment Relations Amendment Act 2026: contractor gateway test with five criteria (written agreement, freedom to work for others, no set availability or freedom to subcontract, no penalty for declining extra work, reasonable opportunity to take advice) | Relevant to how a New Zealand business documents contractor engagements. Missing any one criterion falls back to the real nature of the relationship |
| 21 February 2026 | Same Act: employees earning $200,000 or more cannot bring an unjustified dismissal grievance (12-month transition for existing staff); remedies reduced or removed where the employee contributed; protection for discussing pay | NZ-based employees |
| 1 April 2026 | Adult minimum wage $23.95 an hour (from $23.50); starting-out and training wage $19.16 (from $18.80) | NZ-based employees |
| 1 April 2026 | Employer KiwiSaver default contribution 3.5%, rising to 4% from 1 April 2028 | NZ-based employees |
| 9 July 2026 | Health and Safety at Work Amendment Act 2026 (Royal Assent); Approved Codes of Practice provisions from 10 July 2026; remainder from 1 April 2027 | NZ workplaces |
| 6 August 2026 | Employment Leave Act 2026 (Royal Assent); replaces the Holidays Act 2003 on 6 August 2028, so employers follow the Holidays Act until then and still remediate underpayments | NZ-based employees |
Source: Holland Beckett, 18 October 2026 (updated 22 October); Employment New Zealand (minimum wage, 9 March 2026); MBIE Employment Leave Act page (updated 8 September 2026); Pear Tree compliance notes (KiwiSaver). General information, not legal advice.
The gateway test is the change most relevant to offshore engagements. A worker who meets all five criteria is treated as an independent contractor, and one who misses any falls back to the real nature of the relationship. Employers should document each criterion at engagement rather than rely on the label.
Pay discussions are also now protected. Employees can challenge disadvantage linked to a pay disclosure and the employer carries the onus of proof, so any pay secrecy clause in a New Zealand agreement needs reviewing. Existing staff above the NZ$200,000 grievance threshold have a 12-month transition.
What changed in the countries where your team works?
Wage floors and the 13th month pay deadline are the practical changes. Offshore staff are governed mainly by the law of the country where they work, and a legal employer such as an Employer of Record typically handles compliance there, so confirm who is responsible for tracking each change. Table 3 lists the ones in force or due this year.
Table 3: Wage and leave changes in the main offshore countries, 2026
| Country and region | When | Change |
|---|
| Philippines, Metro Manila | 26 September 2026 | Wage Order NCR-28: daily minimum for non-agriculture workers PHP 755, up PHP 60 from PHP 695; NCR-27 and its January 2027 step remain subject to litigation |
| Philippines, Central Visayas (Cebu) | 14 October 2026 | Wage Order ROVII-27: daily minimum PHP 582 in Class A areas and PHP 542 in Class B areas, up PHP 42 |
| Philippines, nationwide | 24 December 2026 | 13th month pay due under Presidential Decree 851 (one-twelfth of basic salary earned in the year); employer report to DOLE by 15 January 2027 |
| South Africa, nationwide | 1 March 2026 | National minimum wage R30.23 per hour |
Source: National Wages and Productivity Commission (NCR and Central Visayas orders); DOLE Revised Guidelines on the 13th Month Pay Law; Department of Employment and Labour, announced 5 February 2026. Pear Tree's earlier guides cover the Philippines orders in detail. General information, not legal advice.
For most professional roles these floors sit well below actual pay, so the direct cost effect is small. The 13th month pay deadline of 24 December is the one with a hard date. See our guides to the Philippines minimum wage orders and to 13th month pay for the detail.
What might change next?
Four things are worth watching, and none is law yet. The Australian Government's draft ban on non-compete clauses for workers earning below the high income threshold is intended to commence in 2027 if Parliament passes it. New Zealand votes on 7 November, and Lane Neave advises employers to plan for current law to remain unchanged through early 2027. The Philippine NCR-27 wage order, with its January 2027 step, remains in litigation. New Zealand's Health and Safety at Work Amendment Act 2026 takes full effect on 1 April 2027, although Labour has said it would repeal parts of it if elected.
How do you check your offshore engagements against these changes?
Start with classification, then the governing law, then the payroll. First, confirm whether each person is an employee or a genuine contractor, and keep the evidence. Second, confirm which country's law governs the contract and who the legal employer is. Third, confirm who pays and tracks statutory items such as wage floors and 13th month pay.
Pear Tree arranges engagements through Employer of Record or Contractor of Record cover, so the legal employer in the Philippines or South Africa handles local payroll and statutory compliance. Your engagement terms should still say who monitors each change and how any increase is funded. Review the agreements after the New Zealand result, and again if the Australian non-compete ban is introduced.
The bottom line for Australian and New Zealand employers
The 2026 changes mostly leave offshore teams alone, with classification the exception that deserves attention. Document the contractor tests, confirm who handles local payroll, and diarise the 24 December 13th month pay deadline. Pear Tree, with offices in Sydney, Auckland, Hawke's Bay, Cebu, Manila and Cape Town, has placed talent with 750+ Australian and New Zealand businesses on a direct-hire model, so use your next review to confirm each engagement still fits the rules above.
Frequently asked questions
Do Australian employment law changes in 2026 apply to offshore staff?
Mostly not. The Fair Work Act generally does not apply to a worker engaged outside Australia to perform all their duties outside Australia (section 35(3)), so wage, threshold and leave changes mainly affect onshore staff. The exception is classification: the section 15AA whole-of-relationship test and the sham contracting rules still decide whether an offshore worker is an employee or a contractor. This is general information, not legal advice.
What did Payday Super change and does it apply to offshore workers?
From 1 July 2026, superannuation must reach the employee's fund within seven business days of each payday, with up to 20 business days in limited cases, and late payment attracts the super guarantee charge with an administrative uplift of up to 60% of the shortfall. The ATO position is that super guarantee is not payable for a non-resident employee who does all their work outside Australia, but a contractor paid mainly for their labour can still attract it. Take advice on your own arrangement.
What is the New Zealand contractor gateway test?
Under the Employment Relations Amendment Act 2026, in force from 21 February 2026, a worker who meets all five criteria is treated as an independent contractor. The criteria are a written agreement, freedom to work for others, no set availability or freedom to subcontract, no penalty for declining extra work, and a reasonable opportunity to take advice before signing. A worker who misses any criterion falls back to the real nature of the relationship.
When does the New Zealand Employment Leave Act take effect?
The Employment Leave Act 2026 received Royal Assent on 6 August 2026 and replaces the Holidays Act 2003 on 6 August 2028. Employers must keep following the Holidays Act until then and still remediate historical underpayments. It is aimed at New Zealand-based employees.
Is the Australian ban on non-compete clauses law?
No. It is draft legislation that would ban non-compete clauses for workers earning below the high income threshold of $190,100, and it is intended to commence in 2027 if Parliament passes it. Until then, existing restraint clauses are assessed under current law. Review restraint clauses in offshore agreements if the ban is introduced.
About the author
Nick, Co-Founder of Pear Tree, leads sales, partnerships and business development. Pear Tree connects Australian and New Zealand businesses directly with vetted offshore professionals from the Philippines and South Africa, with no agency middleman.
.png)
.png)
