National Minimum Wage and Award Rates to Increase by 1.75%  

The 2020 Annual Wage Review has resulted in a decision by the Fair Work Commission (FWC) to increase the  national minimum wage and the minimum award rate by 1.75% 

national minimum wage review

The new national minimum wage, which applies to all full-time  and part-time employees who are not covered by an award or  agreement, will increase to $753.80 per week or $19.84 per hour (before tax) from 1 July 2020.

The Fair Work Commission has also increased minimum pay rates in the modern awards by 1.75%. 

This is a significantly lower increase from the FWC, in comparison to recent years. Although employer groups argued for a wage freeze, the FWC took into account the effects that COVID-19 has had on the Australian economy, and therefore decided on a phased implementation of the increase across different groups of awards.  

When does the change come into effect? 

Award Group Operative Date
Group 1 Awards 1 July 2020
Group 2 Awards 1 November 2020
Group 3 Awards 1 February 2021

 

The Awards in each group are listed here

Which employees will receive this increase? 

Employees whose minimum wage entitlements are set by:  

  • The national minimum wage  
  • A modern award   
  • A registered agreement (in some circumstances)  

It is important to note that if you have employees on a salary which will already be above the national minimum wage, you are not obliged to increase their salary, however you could consider the 1.75% increase at their next salary review meeting.  

What do employers need to do? 

  1. Check whether your employees are covered by the national minimum wage, or a modern award. 
  2. Should a modern award apply to your employees, ensure you have correctly classified employees  under the relevant award, and confirm the minimum rates of pay that will apply.  
  3. Review  the  current rates of pay  for your employees  and, if  required, adjust their  pay rates from their first full pay period starting on or after the appropriate date as it applies to your modern award.  

Need help?

We have been assisting many businesses with their application of the relevant awards and the minimum rates of pay for their employees. Our team at Allan Hall Human Resources can assist you to navigate this process smoothly and efficiently. Please do not hesitate to contact us should you require assistance or have any further questions.

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