An Australian Referral Agreement (also called an introducer agreement or referral fee agreement) is a contract between two parties — a Company and a Referrer — under which the Referrer agrees to introduce potential customers to the Company in exchange for a referral fee or commission for each successful introduction. The Referrer acts as a business introducer, leveraging their existing relationships and networks to direct new customers to the Company. Unlike an agency arrangement, a referrer typically does not negotiate or enter into contracts on behalf of the Company — their role is limited to making the initial introduction.

Referral agreements are widely used across Australian industries. Professional service firms (accounting, legal, financial planning, IT consulting) frequently enter into cross-referral arrangements with complementary practices, referring clients to each other and paying a fee for successful introductions. Software companies, insurance brokers, mortgage brokers, real estate agents, and recruitment firms also commonly operate referral programs under which business contacts or existing customers are incentivised to introduce new clients.

From a legal perspective, a referral arrangement in Australia is governed by the common law of contract. The key elements of an enforceable referral agreement are: offer and acceptance (the Company offers to pay a referral fee; the Referrer accepts by making referrals); consideration (the referral fee is the Company's consideration; the referral is the Referrer's consideration); certainty of terms (the definition of a qualifying referral, the fee amount, and the payment timing must be certain); and intention to create legal relations (presumed in commercial contexts).

Regulatory overlays apply in certain industries. Financial product referrals may require AFSL licensing. Credit referrals may require ACL authorisation. In all cases, Privacy Act 1988 (Cth) compliance is required when sharing personal information about prospective customers.

A Referral Agreement is needed whenever a business wishes to reward third parties for introducing new customers or clients. Common scenarios in Australia where a formal Referral Agreement is essential include the following.

Professional services cross-referrals: An accounting firm and a legal firm entering a mutual referral arrangement to introduce clients to each other, with a fee paid for each introduction that results in a completed engagement.

Software and SaaS businesses: A software company engaging consultants, integrators, or industry influencers to introduce new users or clients to their platform, paying a fixed fee or percentage commission on the first subscription payment or annual contract value.

Real estate and mortgage referrals: Real estate agents referring clients to mortgage brokers (and vice versa), with a referral fee paid on settlement of the home loan or property transaction.

Insurance referrals: Financial planners or accountants introducing clients to insurance brokers, with a referral fee or trailing commission payable on premium income.

Recruitment and HR: Businesses paying referral fees to individuals or entities who introduce candidates who are successfully placed in a role.

Trade and building services: Trade contractors referring residential or commercial clients to other trades or suppliers, with a fee for each successful engagement.

Health and wellness: Allied health practitioners or gyms entering referral arrangements with complementary service providers.

A written Referral Agreement is essential in all these scenarios to define the qualifying referral, the fee payable, the payment process, and to provide non-circumvention and confidentiality protections for the Referrer.

A well-drafted Australian Referral Agreement should address the following key elements.

Services Being Referred — The agreement must clearly define the Company's services or products for which the Referrer is authorised to make introductions. This limits the Referrer's authority and avoids disputes about whether a particular referral falls within scope.

Definition of a Qualifying Referral — This is the most critical clause in the agreement. It must clearly define what actions the Referrer must take, and what conditions the referred customer must satisfy (e.g. signing a contract, making a first payment) before a Referral Fee becomes payable. Ambiguity in this definition is the most common source of referral fee disputes.

Referral Fee Structure — The agreement must specify the fee payable — whether a fixed dollar amount (AUD) or a percentage of revenue, contract value, or first payment — and confirm whether the fee is inclusive or exclusive of GST.

Payment Timing — When does the Referral Fee become due and when must it be paid? Common triggers are: first payment received from the customer, execution of the customer contract, or monthly in arrears.

Exclusivity — Is the arrangement exclusive (the Referrer can only introduce customers to the Company) or non-exclusive (the Referrer can also work with other businesses)? Exclusivity should be carefully negotiated, as it restricts the Referrer's freedom to engage with other companies.

Non-Circumvention — A non-circumvention clause prevents the Company from bypassing the Referrer to deal directly with a referred customer without paying the fee. This is a critical protection for the Referrer.

Privacy Compliance — The Referral Agreement should address how the Referrer will obtain the prospective customer's consent before sharing their personal information with the Company, in compliance with the Privacy Act 1988 (Cth) and the Australian Privacy Principles.

Independent Contractor Status — The agreement must make clear that the Referrer is an independent contractor, not an employee, agent, or partner of the Company. This affects tax, superannuation, and WorkCover obligations.