Australia’s regulatory environment is notoriously complex, with businesses spending a staggering $160 billion annually to meet compliance requirements, according to data from Mandala Partners. Despite this massive expenditure, hundreds of thousands of workers remain underpaid, and over half of audited businesses fail to comply with regulatory standards, as reported by the Fair Work Ombudsman.

Ben Thompson, CEO and Co-Founder of Employment Hero, highlighted the challenges faced by businesses trying to navigate this intricate system. "Most businesses aren’t failing at compliance because they’re careless or dishonest. They’re struggling because individual employers are trying to solve an extremely specialised regulatory problem while also running the business. The system has become too complex to manage manually," he explained.

HeroForce represents an AI-enabled evolution of co-employment models, centralising and automating employment complexities on a global scale. By becoming the legal employer, Employment Hero manages payroll, compliance, and HR administration, while businesses maintain operational control over their workforce. This approach not only reduces duplicated administrative costs but also addresses significant structural barriers that have long hindered Australian employers and employees.

Thompson elaborated on the potential of artificial intelligence to relieve the growing pressure on employers. "The average SMB spends $40,000–$80,000 a year just to stay compliant with employment law. Running a business in Australia increasingly means becoming an expert in payroll, modern awards, Fair Work compliance, and superannuation," he said. Employment Hero’s Hero AI can interpret modern awards, develop rosters, automate payroll calculations, and monitor compliance obligations across thousands of employment relationships simultaneously. "That fundamentally changes the economics of employment administration," Thompson added.

The current employment framework in Australia includes more than 120 modern awards, each with its own classifications, pay conditions, and compliance requirements. The regulatory burden continues to grow, with recent reforms and economic conditions exacerbating the challenges faced by businesses. According to the National Australia Bank’s Quarterly Business Survey, 59 per cent of organisations cite reducing operational costs as their primary challenge, while 49 per cent struggle to attract and retain talent.

Employment Hero’s data shows that casual employment is surging at 9.3 per cent year on year, more than double the rate of full-time roles. This trend reflects businesses’ need for flexibility amidst rising compliance pressure and wavering business confidence. The Australian Bureau of Statistics reports that 7.5 per cent of the workforce are independent contractors, further indicating a shift in the labour market.

Thompson emphasised the broader economic benefits of reducing employment administration friction. "By removing the friction that prevents employment, employment becomes cheaper and simpler, and as decades of historical evidence tell us, businesses will employ more people to build more, serve more, expand into new areas. Every hour reclaimed from repetitive administration is an hour redirected to work that actually grows economies," he said.

Analysis of Professional Employer Organisations (PEOs) in the US shows that user organisations experience twice the growth rate of comparable companies, 12 per cent lower employee turnover, and are 50 per cent less likely to go out of business. Organisations report an average 27.2 per cent return on investment, with a 3–5 per cent service fee unlocking fully-managed employment.

Thompson also highlighted the benefits for workers. "The last financial year saw 250,000 Australian workers underpaid, despite the huge investment in compliance. Of the businesses the Fair Work Ombudsman investigated, 56 per cent were found to be non-compliant. For years, I’ve seen businesses try and navigate the system to fall short due to its complexity rather than deliberate wrongdoing. These issues are frequently the result of fragmented compliance systems rather than bad intent," he noted.

HeroForce has been designed to operate fully within Australia’s regulatory framework, ensuring that workers engaged through the platform are employees under formal employment contracts and retain full protections under the Fair Work Act, including award wages, superannuation contributions, leave, and workers’ compensation.

Now available in Australia, HeroForce is also being launched in New Zealand, the UK, and Canada, bringing AI-powered efficiency to these high-complexity markets. Employment Hero aims to make employment easier and more valuable for everyone, addressing the challenges of compliance and administration on a global scale.