- 5.2% Increase to National Minimum Wage (NMW)
- 4.6% Increase to Award Wage (subject to a minimum increase of $40 per week for adults)
The Fair Work Commission (FWC) has announced a 5.2% increase to the national minimum wage and a 4.6% increase to award minimum wages (subject to a minimum increase of $40 per week for full time adult employees) following its 2021-2022 annual wage review.
The commencement of the increase will apply from the first full pay period starting on or after 1 July 2022, with the exception of certain awards in the aviation, tourism and hospitality sectors.
Relevantly, increases for the Vehicle Repair, Services and Retail Award, Clerks Private Sector Award and Manufacturing and Associated Industries and Occupations Award will operate from 1 July 2022.
Employer Assist will provide members with access to updated pay guides once the FWC publishes the variation determinations. The Fair Work Ombudsman will also release updated pay guides in due course.
If you are already paying your employees more than the minimum award rate, you may be able to absorb the increase depending on the particular employment arrangements.
Members can contact Employer Assist for specific advice on whether absorbing an increase is possible based on individual circumstances.
If a registered agreement applies to the workplace, you will need to ensure the minimum base rates in the agreement remain at least equal to the base award rates.
If not, the agreement rates will need to be increased to at least match the base award rates.
Award Free Employees
The new national minimum wage that will apply from the first full pay period starting on or after 1 July 2022 will be $812.60 per week or $21.38 per hour.
This constitutes an increase of $40 per week for full time (38 hours) employees. The national minimum wage applies to employees who aren’t covered by an award or registered agreement.
The Superannuation Guarantee (SG) rate is set to increase to 10.5% on 1 July 2022. Also, employees will be eligible for SG, regardless of how much they earn.
This is because the $450 per month eligibility threshold for when SG is paid is being removed. You only need to pay super for employees under 18 when they work more than 30 hours in a week.
Members should keep an eye out for updated pay guides. In the meantime, you can start reviewing your current wage arrangements to determine whether the increase can be absorbed or if you need to budget for the increase.
Now is a good opportunity to review existing employment contracts or if there are no existing employment contracts, implement new employment contracts.
Employer Assist can review existing employment contracts and provide members with advice on any amendments required or improvements that can be made.
Employer Assist can also provide members with template employment contracts tailored to suit any individual requirements.
If you require assistance, contact Employer Assist on (07) 3376 6266 or firstname.lastname@example.org.
This article is intended for information purposes only and should not be regarded as legal advice. Please contact Employer Assist for advice.
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