Minimum Wage Increase
The Fair Work Commission has announced that a 5.2% increase will apply to the minimum wage and a 4.6%, increase to Modern Award minimum wages with effect from the first pay period in July 2022.
The following will apply:
The legislated minimum wage will increase by $1.05 to $21.38 per hour ($812.60 per week) for adult workers. This rate applies to workers not covered by a Modern Award.
Wages for workers covered by Modern Awards that are above $869.60 per week will be increased by 4.6%. Pay rates below this figure will be adjusted by $40 per week.
The new rates apply to the majority of Modern Awards from 1 July 2022, with the exception of modern awards in the aviation, tourism and hospitality sectors. The variation within these industries will only be applicable from 1 October 2022.
What must employers do right now?
Employers covered by Modern Awards or with employees receiving payments based on the national minimum wage, must review wages to ensure that employees are paid correctly.
Remuneration paid to employees on an enterprise agreement (if applicable) must be reviewed to ensure they remain compliant with the terms of that enterprise agreement.
Employers may absorb the increases if workers are paid over the resultant minimum rates pertaining to their Modern Award classification level. We recommend that employers review the salary packages of those employees on annualised salaries or loaded salaries to ensure they meet the minimum wage better off overall test (BOOT).
Advise employees of the changes that apply to them.