The Fair Work Commission’s annual wage reviews have determined that the National Minimum Wage and modern award minimum wages will increase by 1.75% and the National Minimum Wage will increase to $753.80 per week (up from $740.80 per week) or $19.84 per hour (up from $19.49 per hour).

While the National Minimum Wage will increase from 1 July 2020, the modern award increases will be rolled out in stages to reflect the effect of the COVID-19 pandemic on different areas of employment to consider the likely impact the increase may have on the economy.

The three-stage process, beginning with economic sectors assessed as being less affected by the COVID-19 pandemic, is:

• Frontline health workers, social assistance workers, teachers and childcare workers and other essential services such as funeral, cleaning and banking workers will receive their increase from 1 July 2020
• Construction, manufacturing and similar industries will receive the increase from 1 November 2020.
• Accommodation and food services, aviation, retail and tourism industries will receive the increase from 1 February 2021.

Employers who pay their employees the National Minimum Wage and under certain industrial instruments will need to increase their employees’ pay in the first pay period on or after 1 July 2020.

Employers who pay minimum wage rates under a modern award and certain industrial instruments, will have to increase their employees’ pay in the first pay period on or after 1 July 2020, 1 November 2020 or 1 February 2021, depending on which modern award applies.

Employers who pay their employees under an industrial instrument such as a collective or enterprise agreement should review the rates under those instruments to ensure that they are equal to or above the minimum wage rates.

Employers who pay their employees above the minimum wage rates may absorb the increases, making no changes.

 

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Please note that this article has been prepared by Margaret Miller, partner of Bell Legal Group, for information purposes only. It is not legal advice nor should it be relied upon as such.