Minimum wage to increase by 1.75% but at different times for different awards
19 June 2020
The Fair Work Commission Expert Wage Panel has today handed down its decision to increase the National Minimum Wage and all Modern Award minimum rates of pay by 1.75%.
The decision will increase the National Minimum wage to $753.80 per week (an increase of $13) from the first full pay period on or after 1 July 2020, calculated on the basis of a week of 38 ordinary hours, or $19.84 per hour.
However, the operative date of the increase to Modern Award rates of pay will vary depending on the industry, as follows:
The decision takes into account the impact of the COVID-19 pandemic on the Australian economy. Please note, for most CCER members, relevant awards will be in Group 1. For details of which Modern Awards fall into which Group click here. The decision can be accessed here.
How to ensure you comply with the decision:
- If your employees are covered by a Modern Award, the 1.75% increase will apply to all of the current Modern Award rates from the relevant effective date. CCER will shortly be releasing new pay schedules to reflect these increases and the operative date. CCER will also release a transitional pay schedule for the Social and Community Services employees of the Social, Community, Home Care and Disability Services Industry Award 2010.
- If your employees are covered under an Enterprise Agreement, you must ensure the minimum rates of pay are no less than the increased rates set out in the applicable Modern Award, from the relevant effective date.
- For employees who are not covered by an award/agreement, the new National Minimum Wage will apply from the first full pay period on or after 1 July 2020.
- If you are paying above the new National Minimum Wage or Modern Award rates, you are not obliged to increase rates of pay unless you have agreed to do so.
- The increase also applies to rates for junior employees, apprentices, trainees and employees engaged through the Supported Wage System Schedule.
CHECKLIST: What do employers need to do?
- Identify which award(s) apply to your organisation and when the increase is scheduled to take effective. For most CCER members, relevant awards will be in Group 1 with increases due from the first full pay period on or after 1 July 2020 ;
- Check that all employees are receiving at least the minimum rates of pay in line with the above; and
- Review all annualised salary arrangements to ensure that those employees are still receiving, at least, the minimum amounts in the Modern Award.
Updated pay schedules will be released by CCER in the coming weeks.
Disclaimer: CCER does not give legal advice and this information should not be taken as such.