Employment Hero has launched a new AI-powered system it says will reduce complexity for small businesses, while handing responsibility for payroll, award compliance, and superannuation to Employment Hero itself.
The Australian workforce management platform on Wednesday debuted HeroForce, its updated take on the traditional employee of record (EOR) system.
Under the EOR system, businesses recruit partner organisations to handle key elements of the employment relationship, from contracts to benefits and compliance with local industrial relations laws.
The original business is left to handle its day-to-day operations, allowing it to focus on its goals and targets without building in-house HR functions.
Employment Hero CEO Ben Thompson said the HeroForce launch comes in response to rising complexity facing small businesses.
“Most businesses aren’t failing at compliance because they’re careless or dishonest,” he said.
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“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.”
The average SME spends the equivalent of between $40,000 and $80,000 each year to stay compliant with workplace laws, according to Thompson.
Compartmentalising those costs in HeroForce “fundamentally changes the economics of employment administration,” he added.
Beyond simply managing employment for workers based in Australia, Employment Hero also says its HeroForce platform is capable of hiring global talent.
The business boasts access to workers in 180 jurisdictions, without the difficulty of first establishing a local hiring entity.
Putting faith in a ‘hire’ power
Employment Hero has long offered an EOR service, providing what it calls “co-employment” opportunities to Australian businesses.
It says HeroForce is different, pointing to the introduction of AI tools that can “interpret modern awards, develop rosters, automate payroll calculations and monitor compliance obligations” for thousands of employees at any one time.
The platform says it operates three AI agents on the system: a recruitment tool capable of mass candidate matching, a payroll tool to interpret modern awards, and an HR bot providing guidance for everything from hiring to firing.
Employment Hero is just one of many businesses and regulatory bodies across Australia investigating how artificial intelligence could help workers and employers navigate complex rules and obligations.
But not all AI tools are perfect for the job: the Fair Work Commission, for example, is swamped by AI-generated unfair dismissal claims with little to no merit.
Assuaging fears that client businesses could be on the hook for errors produced by HeroForce, Employment Hero confirmed that as the legal employer, it bears responsibility for the employment relationship.
“Employment Hero takes full responsibility for pay compliance and award compliance,” a spokesperson said, including in the “unlikely event” of mismanaged entitlements.
It is also responsible “for the defence of employment-related claims, including discrimination,” they added.
“That said, there is nuance: where the underlying conduct that gives rise to a claim originates with the client’s business, for example, a manager’s behaviour, Employment Hero may be drawn into proceedings relating to conduct it didn’t have prior visibility of.
“That is precisely why HeroForce has clear processes for escalation and grievances that involve direct engagement with the client’s business where relevant.”
Employment Hero also claims HeroForce’s HR AI agent operates on a human-in-the-loop model, allowing specialists to step in should errors occur.
Employment Hero is perhaps the largest Australian payroll platform to introduce AI to its EOR system, but it is not alone in this sphere.
Local startup MyGig in November secured a $1 million pre-seed funding round to develop its AI-enabled EOR system for casual workers.
