It's not illegal to hire people in Australia
However, since this is a revenue-generating property, you are a "person conducting a business or undertaking" under your state's Work Health and Safety laws. That means you are responsible for their health and safety. If they injure or kill themselves doing the work, you can be fined or jailed if you failed to take reasonable care. This is in addition to any liability you might have to them or their family for their loss. If the work they are doing is construction work under the Act (or high-risk construction work), which both painting and gardening might be, then there are additional obligations. Note: this obligation exists whether they are being paid or not.
If you are hiring your friend in a way that corresponds with an actual business they run (e.g. they operate a painting, gardening, or handyman business), then it would be no different than hiring a business not run by a friend.
If not, this relationship is unlikely to be considered an employer-employee relationship since no ongoing contractual relationship is intended. As such, your friend is likely to be treated as an independent contractor. However, the decision is ultimately a matter for the court and will depend primarily on the contract you entered. So, a verbal contract would be ... unwise.
If they are an employee, then all the normal baggage is triggered: workers' compensation insurance, withholding tax, superannuation, redundancy, minimum wage laws, having to pay in cash rather than beer, etc.
If you have an Australian Business Number (ABN), which you would be required to have if your revenue from the rental business exceeds $75,000 pa, and they don't, you are required to withhold 48.5% tax from their remuneration (cash plus beer value) and remit that to the Australian Tax Office (ATO). Either way, they need to declare their remuneration as income on their tax return, and you can claim it as either a capital improvement or revenue expense on yours, depending on what the "work" actually is.
You should check that your landlord's insurance covers any acts or omissions they might make while working for you and any injuries they might suffer.