National Minimum Wage to rise by 2.5%
In its decision on 16 June 2021, the Fair Work Commission increased the national minimum wage to $772.60 per week or $20.33 an hour.
Unions had sought an increase of 3.5% on the basis that pay growth is crucial to stimulate post-pandemic economic recovery, while some employer groups called for no increase due to the impact of the pandemic on businesses.
When does the change come into effect?
The new national minimum wage will apply from 1 July 2021. However, the award increase has been delayed in sectors most affected by the COVID-19 pandemic and will therefore take effect in 3 stages.
Most awards will increase from 1 July 2021. Wages in the Retail Award will increase from 1 September 2021 and the rates in 21 other awards where the FWC deemed there were exceptional circumstances will increase from 1 November 2021.
The awards that will increase from 1 November 2021 are listed here.
- Pilots Award
- Cabin Crew Award
- Airline Ground Staff Award
- Airport Award
- Alpine Resorts Award
- Amusement Award
- Dry Cleaning and Laundry Award
- Fitness Award
- Hair and Beauty Award
- Hospitality Award
- Live Performance Award
- Models Award
- Marine Tourism and Charter Vessels Award
- Nursery Award
- Racing Clubs Events Award
- Racing Ground Maintenance Award
- Registered Clubs Award
- Restaurant Award
- Sporting Organisations Award
- Travelling Shows Award
- Wine Award
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 non-Award covered employees on a salary which is above the national minimum wage, you are not obliged to increase their salary, however you could consider an increase at their next salary review meeting.
What do employers need to do?
- Check whether your employees are covered by the national minimum wage, or a modern award.
- 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.
- 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.
We assist many businesses with their application of the relevant awards and the minimum rates of pay for their employees to ensure businesses remain legally compliant. 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.