What Does an HR Consultant Do? A Plain-English Guide for Australian SMEs

An HR consultant is an independent workplace relations specialist who helps a business manage the employment side of running a company — hiring, contracts, pay compliance, performance management, workplace investigations, policies, and terminations — without the business needing to employ a full-time, in-house HR manager. For an Australian small or medium business, an HR consultant typically works on a project, retainer, or “fractional” basis, stepping in to handle specific issues (like a difficult termination or an award compliance check) or to provide ongoing, part-time HR support at a fraction of the cost of a full-time hire.

If you run a business with no internal HR department, this guide explains exactly what an HR consultant does, when to use one, what the law requires you to get right, and how to avoid the most common (and expensive) mistakes SME owners make when managing people without HR support.

The Short Answer: What an HR Consultant Actually Does

An HR consultant’s core job is to keep your business compliant, fair, and operationally sound on everything related to employing people. In practice, that usually falls into six areas:

Recruitment and onboarding — writing job ads, running interviews, drafting employment contracts, and setting up compliant onboarding processes.
Pay and award compliance — checking employees are classified and paid correctly under the relevant Modern Award or the National Minimum Wage.
Policies and procedures — building workplace policies (WHS, bullying and harassment, social media, leave) that meet Fair Work Act 2009 and work health and safety obligations.
Performance management and terminations — guiding managers through underperformance processes, warnings, and dismissals in a way that reduces the risk of an unfair dismissal or general protections claim.
Workplace investigations — independently investigating complaints of bullying, harassment, or misconduct.
Strategic people advice — remuneration structuring, restructures, redundancies, culture and engagement, and building the people processes a growing business needs as it scales.

An HR consultant is different from an employment lawyer (who represents you in disputes and litigation) and different from a recruitment agency (whose primary job is filling vacancies). A good HR consultant often works alongside both, but their focus is the ongoing, practical management of your workforce.

Why SMEs Use HR Consultants

Most small and medium Australian businesses don’t have the size or budget to justify a full-time HR manager, yet they carry exactly the same legal obligations under the Fair Work Act as a large corporate employer. A business with five employees has the same duty to correctly classify staff under a Modern Award, provide the National Employment Standards (NES), and follow a fair dismissal process as a business with 500.

This is the gap an HR consultant fills. Common triggers for engaging one include:

The business is growing and hiring for the first time, or hiring faster than the owner can manage
A difficult employee issue has arisen (underperformance, conduct, a complaint) and the owner isn’t sure how to handle it compliantly
The business has never had its award coverage or pay rates checked and wants assurance it isn’t underpaying staff
Managers need policies, contracts, and position descriptions that are currently missing or out of date
The business wants ongoing, part-time People and Culture support without the cost of a full-time executive — often called fractional HR, where a business essentially “shares” a senior HR consultant’s time across a few days a month rather than employing one person full-time

The Legal Framework an HR Consultant Works Within

A large part of an HR consultant’s value is knowing how the following interact — because getting any one of them wrong creates real legal and financial risk for a business.

The Fair Work Act 2009

The Fair Work Act 2009 is the primary piece of Commonwealth legislation governing employment in Australia. It sets the framework for the National Employment Standards, Modern Awards, unfair dismissal, general protections (adverse action), enterprise bargaining, and the powers of the Fair Work Commission (FWC) and Fair Work Ombudsman (FWO).

The National Employment Standards (NES)

The NES are minimum employment entitlements that have to be provided to all employees in the national workplace relations system, and no award, agreement, or employment contract can offer less than what the NES provides. They cover 11 entitlements, including:

Maximum weekly hours (38 hours per week, plus reasonable additional hours)
Requests for flexible working arrangements
Parental leave and related entitlements
Annual leave of four weeks’ paid leave per year, plus an extra week for certain shift workers
10 days’ paid personal/carer’s leave, plus compassionate, bereavement, and family and domestic violence leave
Community service leave, including paid jury service leave
Long service leave, public holidays, notice of termination and redundancy pay, and the Fair Work Information Statement

An HR consultant should be able to walk you through exactly how each of these applies to your business and your specific employees, including where casual employees receive a different (but not lesser) set of entitlements.

Modern Awards and pay rates

Most Australian employees are covered by a Modern Award relevant to their industry or role, which sets minimum pay rates, penalty rates, allowances, and classification structures on top of the NES. Getting classification wrong — even unintentionally — is one of the most common and costly compliance failures SMEs make, and it’s a core part of what a competent HR consultant checks early in any engagement.

Minimum pay rates change every year following the Fair Work Commission’s Annual Wage Review. As of 1 July 2026, the National Minimum Wage is $26.44 per hour or $1,004.90 per week for employees not covered by an award or agreement. Employees covered by an award are entitled to at least their award rate, which is reviewed each year and now generally sits at or above the National Minimum Wage. Because these rates change annually, an HR consultant should always confirm current rates against the Fair Work Ombudsman’s Pay and Conditions Tool rather than relying on last year’s figures.

Unfair dismissal and the Small Business Fair Dismissal Code

This is one of the areas where SME owners most often get into trouble without HR support. To be eligible to bring an unfair dismissal claim, an employee generally must have completed a minimum employment period — at least 6 months, or 12 months if they worked for a small business (defined as an employer with fewer than 15 employees at a particular time, counted on a simple headcount of all employees who are employed on a regular and systematic basis).

If your business meets the small business definition, the Small Business Fair Dismissal Code gives you a structured, lower-risk pathway for dismissals — a dismissal is not unfairly dismissed if the Fair Work Commission is satisfied it was consistent with the Code. But the Code still requires a fair, documented process; simply being a small business does not remove the need to follow it correctly.

The Fair Work Ombudsman and Fair Work Commission

These are two different bodies, and it matters which one you’re dealing with:

The Fair Work Ombudsman (FWO) is the regulator. Its role is to promote harmonious, productive, cooperative and compliant workplace relations, and to monitor, inquire into, investigate, and enforce compliance with Australia’s workplace laws. It handles underpayment complaints, provides free advice and templates, and conducts audits.
The Fair Work Commission (FWC) is the independent tribunal. It sets minimum wages and award rates through the Annual Wage Review, approves enterprise agreements, and hears unfair dismissal and general protections disputes.

An HR consultant should know which body to engage with — and when — depending on the issue at hand.

Practical Examples

Example 1 — A café hiring its first supervisor. A five-employee café owner in Victoria wants to promote a barista into a supervisor role and isn’t sure how to structure the pay increase, whether a new contract is needed, or what probation period applies. An HR consultant checks award coverage (likely the Hospitality Industry (General) Award), confirms the correct classification and minimum rate for the new duties, drafts a compliant employment contract with a probation clause, and sets up a simple onboarding checklist for the transition.

Example 2 — A trades business needing to manage underperformance. A 12-person plumbing business has an employee whose performance has declined over several months. The owner wants to issue a warning but has never done one and is worried about “getting it wrong.” Because the business has fewer than 15 employees, it is a small business employer for unfair dismissal purposes. An HR consultant runs the performance management process in line with the Small Business Fair Dismissal Code — documenting the issue, giving the employee a genuine opportunity to respond and improve, and keeping a clear paper trail — so that if the matter ultimately ends in dismissal, the business has followed a defensible, compliant process.

Common Mistakes SMEs Make Without HR Support

Assuming “everyone is on the award anyway” without ever checking classification, duties, or whether pay rates have kept pace with annual award increases
Using generic contract templates downloaded online that don’t reflect the correct award, NES entitlements, or the business’s actual state and industry
Verbal warnings with no documentation, leaving no evidence of a fair process if a dismissal is later challenged
Dismissing an employee on the spot for conduct or performance issues without following the Small Business Fair Dismissal Code or considering procedural fairness
Not knowing the minimum employment period and dismissing an employee incorrectly within it, or misunderstanding how the 15-employee small business threshold is counted
Treating a workplace complaint informally instead of running a proper, impartial investigation, which increases both legal risk and staff turnover
Confusing the Fair Work Ombudsman and Fair Work Commission, and going to the wrong body for advice or a dispute

Checklist: Do You Need an HR Consultant?

Use this quick checklist to gauge how exposed your business currently is:

[ ] We have written, up-to-date employment contracts for every employee

[ ] We know exactly which Modern Award (if any) applies to each role, and our pay rates are current as of the latest Annual Wage Review

[ ] We have core workplace policies in place (code of conduct, WHS, bullying and harassment, leave)

[ ] Our managers know how to run a documented performance conversation

[ ] We know whether our business currently meets the “small business” definition (fewer than 15 employees) for dismissal purposes

[ ] We have a clear, fair process for handling workplace complaints

[ ] Someone in the business is responsible for tracking changes to award rates and Fair Work obligations each year

If you ticked fewer than five boxes, an HR health check is likely to uncover real risk sitting in your business right now.

How HR Excellence Partners Supports SMEs

At HR Excellence Partners, we work exclusively with Australian small and medium businesses that don’t have — and often don’t need — a full-time, in-house HR department. Whether you need a single issue resolved (a tricky termination, a compliance check, a workplace investigation) or ongoing fractional HR support to build out your people processes as you grow, we plug in at the level your business actually needs.

That might mean a one-off project, a retainer for a few hours a month, or acting as your outsourced People and Culture function entirely. Either way, our job is to give you the confidence that your business is compliant with the Fair Work Act, the NES, and the awards that apply to your team — without the overhead of a full-time hire.

The best place to start is an HR Health Check — a practical review of your current contracts, policies, pay compliance, and people risk, with a clear action plan at the end.

Use code HEPFREE at checkout to have the cost of your HR Health Check waived.

📧 vas@hrexcellencepartners.com.au 🌐 hrexcellencepartners.com.au 📞 +61 432 244 744

Vas Papadopoulos
Founder & Principal HR Consultant
HR Excellence Partners
vas@hrexcellencepartners.com.au
hrexcellencepartners.com.au
+61 432 244 744

References

Fair Work Ombudsman, About the Fair Work Ombudsman — https://www.fairwork.gov.au/tools-and-resources/fact-sheets/about-us/about-the-fair-work-ombudsman
Fair Work Ombudsman, National Employment Standards — https://www.fairwork.gov.au/employment-conditions/national-employment-standards
Fair Work Ombudsman, Introduction to the National Employment Standards fact sheet — https://www.fairwork.gov.au/tools-and-resources/fact-sheets/minimum-workplace-entitlements/introduction-to-the-national-employment-standards
Fair Work Commission, National Employment Standards — https://www.fwc.gov.au/work-conditions/minimum-wages-and-conditions/national-employment-standards
Fair Work Ombudsman, Minimum wages — https://www.fairwork.gov.au/pay-and-wages/minimum-wages
Fair Work Ombudsman, Minimum wage increase starts today (1 July 2026 media release) — https://www.fairwork.gov.au/newsroom/media-releases/2026-media-releases/july-2026/20260701-minimum-wage-increase-media-release
Fair Work Ombudsman, Unfair dismissal — https://www.fairwork.gov.au/ending-employment/unfair-dismissal
Fair Work Ombudsman, Ending employment fact sheet — https://www.fairwork.gov.au/tools-and-resources/fact-sheets/minimum-workplace-entitlements/ending-employment
Fair Work Commission, What is the Small Business Fair Dismissal Code? — https://www.fwc.gov.au/what-small-business-fair-dismissal-code
Fair Work Commission, Dismissal rules for small business owners — https://www.fwc.gov.au/about-us/education-and-engagement-activities/small-business-hub/dismissal-rules-small-business
Fair Work Ombudsman, Difference between the Fair Work Ombudsman and the Fair Work Commission — https://www.fairwork.gov.au/about-us/our-role-and-purpose/difference-fair-work-ombudsman-and-fair-work-commission
Federal Register of Legislation, Fair Work Act 2009 — https://www.legislation.gov.au/C2009A00028/latest/text

What Does an HR Consultant Do? A Plain-English Guide for Australian SMEs

The Short Answer: What an HR Consultant Actually Does

Why SMEs Use HR Consultants