On the 19th June the Fair Work Commission announced a 1.75% increase to minimum wages effective 1 July 2020. The increase applies to employees that are on the minimum pay rate which will mean more than 2.2 million Australians will get an increase.
The minimum wage in Australia is now $19.84 per hour ($753.80 for a 38-hour week), this will mean a $13 increase per week. Most employees however, are covered by an award. An award sets the minimum wage for an employee based on the industry they work in and what role they have within that industry. You can work out what you need to pay your employees according to your industry award here.
The increase to the awards is in 3 groups on 3 separate dates.
Group 1 (From 1 July 2020)
- Frontline Heath Care & Social Assistance Workers
- Teachers and Child Care
- Other Essential Services
Group 2 Awards (From 1 November 2020)
- A range of other industries
Group 3 Awards (From 1 February 2021)
- Accommodation and Food Services
- Arts and Recreation Services
What this means for businesses
Employers must satisfy the new minimum payment obligations according to the date based on industry and group. The increase applies from the first full pay period on or after the wage increase start date.
If you have employees on the National Minimum Wage you will need to pay them in accordance with the new minimum rates.
If you have employees on the Modern Award rates, you will need to ensure that they are paid in accordance with the new minimum award rates.
These increases also apply to businesses that are on the JobKeeper subsidy.
Ensure that you carefully review your wage arrangements and implement the necessary increases accordingly. We recommend that you speak with your Employment Lawyer to confirm that you comply with the new regulations.
If you have any questions, please call us on 03 8419 9800.