In big news affecting many employers across the country, the Fair Work Commission (FWC) last week voted to increase the National Minimum Wage, together with all Modern Award minimum rates of pay, by 1.75%. This translates to a full-time wage of $753.80 per week, or a $19.84 hourly rate.

The FWC’s Minimum Wage Panel heard petitions from employer and industry groups (who recommended to not increase rates, or delay an increase while so many employers have been affected by the latest economic downturn) as well as the ACTU, who pushed for a 4% increase, to support low-paid workers and also help stimulate the economy. The FWC Panel advocated for a cautious approach to pay rises, with the increase being spread over three stages.

Who will be affected, and when?

The first scheduled wage increase comes into effect on July 1st 2020, and will effect the following groups:

  • Frontline health care and social assistance workers
  • Teachers and childcare workers
  • Other essential services

Group 2 is scheduled for increase on 1st November 2020. This group includes:

  • Construction
  • Manufacturing
  • A range of other industries

The third group will receive their wage increase on 1st February 2021, and will affect:

  • Accommodation and food services
  • Arts and recreation services
  • Aviation
  • Retail trade
  • Tourism

What about Annualised Salaries and Individual Flexibility Agreements, or other agreements?

If you have a written agreement with your employees, either an IFA or an annual salary agreement, you’ll need to make sure that they remain ‘better off overall’ when compared to the new award rates. Assurance HR can help you run the appropriate testing on this, and ensure your pay rates are compliant.

Assurance HR fully appreciates the challenging economic environment we’re all facing, and we’re here to help you understand how this decision affects your business. If you need help unpacking the ruling, auditing and calculating pay rates, or any other flow-on effect, contact us today! Call us on 1800 577 515, or book an appointment directly here.

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