The new financial year always brings with it a raft of changes for business owners and this year is no exception. Your most important asset as an employer is meeting your legal obligations to your employees, especially when it comes to paying them correctly and from 1 July there was an update to the minimum wage that you need to ensure you have passed on to your employees.
On May 31 this year, the Fair Work Commission Expert Panel completed its review of the national minimum wage and ruled for an increase to the national minimum wage and award classifications.
The ruling called for an increase to award covered employees of 2.4% of the weekly wage, to be rounded to the nearest 10 cents. This equates to an increase to the national minimum wage to $672.70 per week, or $17.70 per hour and covers all employees from 1 July.
In deciding to rule on an increase to the national minimum wage the Fair Work Commission Expert Panel considered the following factors:
- Inflation and wage growth in Australia remain at historically low levels.
- There was an increase in company profits for those in the non-mining sectors in 2015.
- Australia is currently benefiting from an improved economic environment, with stronger labour market conditions.
- There has been a deterioration in the relative position of those working on the minimum wage, with the majority of these employees living in low income households and suffering from lower living standards.
- The gender pay gap is still wide and women are over-represented amongst minimum wage employees.
- Australia’s economy is still experiencing positive growth.
These were just a few of the factors that sat behind the Panel’s thinking in ruling for a wage increase.
If you are an employer with employees covered by an award it is vital that you review the updated modern award classifications to ensure you are meeting the higher pay rate for minimum wage employees.