New financial year, new award wage increases
Now is the time to re-focus your team for success and review award changes effective from July 2021.
The new financial year is upon us and, from July 2021, minimum wages will increase in most modern awards from the first full pay period commencing on or after 1 July 2021.
Now is the perfect time to set out your business priorities, review upcoming changes to award wages and your human resource management systems to re-engage employees and recalibrate a team focused clearly on success.
Similarly, the new financial year is the perfect time to ensure your policies, employment agreements and employee records are legally compliant and tailored to meet your business needs.
Some points from the Fair Work Commission (FWC) decision includes:
- A national minimum wages for juniors, employees under training arrangements, and employees with a disability;
- A 2.5% applies to:
- minimum wages in modern awards
- national minimum wage, raising it by $18.80 to $772.60 per week, or $20.33 per hour;
- The increases will apply in three stages with the rates in most modern awards increasing from the first full pay period commencing on or after 1 July 2021.
- The increases in some awards will be deferred to the first full pay period commencing on or after 1 September 2021 or 1 November 2021.
The first round of Fair Work Commission award wage increases for this financial year will become effective from the first full pay period on or after 1 July 2021 as set out below:
MODERN AWARD COVERED EMPLOYEES & MINIMUM WAGES:
The minimum rates of pay for adult employees covered by a modern award are to be increased by 2.5%. The weekly wages will be rounded to the nearest $0.10.
The increases will flow through to junior employees, employees to whom training arrangements apply in modern awards (including the rates under the National Training Wage Schedule), employees with a disability and piece rates.
EFFECTIVE DATES:
The FWC has again decided to stagger the award wage increases, albeit to a lesser extent than during COVID-19.
- The minimum wages will increase in all modern awards from the first full pay period commencing on or after 1 July 2021,
EXCEPT FOR:
- the General Retail Industry Award 2020, where the increase will come into effect from 1 September 2021; and
- the following modern awards, where the increase will come into effect from 1 November 2021;
- Air Pilots Award 2020
- Aircraft Cabin Crew Award 2020
- Airline Operations –Ground Staff Award 2020
- Airport Employees Award 2020
- Airservices Australia Enterprise Award 2016
- Alpine Resorts Award 2020
- Amusement, Events and Recreation Award 2020
- Dry Cleaning and Laundry Industry Award 2020
- Fitness Industry Award 2020
- Hair and Beauty Industry Award 2010
- Hospitality Industry (General) Award 2020
- Live Performance Award 2020
- Mannequins and Models Award 2020
- Marine Tourism and Charter Vessels Award 2020
- Nursery Award 2020
- Racing Clubs Events Award 2020
- Racing Industry Ground Maintenance Award 2020
- Registered and Licensed Clubs Award 2020
- Restaurant Industry Award 2020
- Sporting Organisations Award 2020
- Travelling Shows Award 2020
- Wine Industry Award 2020
AWARD/AGREEMENT FREE EMPLOYEES – MINIMUM WAGES:
Award/agreement free adult employees are covered by the national minimum wage. This will be increased by $18.80 to $772.60 per week (or $20.33 per hour) from the first full pay period on or after 1 July 2021.
Casual award/agreement free employees are also covered by a default casual loading which remains at 25%.
The increase will flow to award/agreement free junior employees and employees to whom training arrangements apply. These wages will continue to be set by reference to the Miscellaneous Award 2020.
The increase will also flow to award/agreement free employees with a disability. Where the disability effects their productivity, these employees will continue to be paid in accordance with an assessment under the Supported Wage System Schedule. The minimum weekly payment for these employees (currently $89) was not increased as part of the annual wage review but is expected to be reviewed prior to 1 July 2021.
Akyra’s key takeaways
With high-profile underpayment and record-keeping cases receiving more media and legislative attention than ever including new, higher penalties for serious contraventions of the Fair Work Act, it is now more important than ever to ensure you are meeting your legal requirements.
You should ensure your employees who are paid in accordance with a modern award or the national minimum wage receive the appropriate pay increase by the relevant effective date.
Where you pay above the relevant Modern Award, you will need to ensure the wage rate / salary / flat rate you pay your employees satisfy all of your obligations under the relevant award/minimum wage once the increases apply.
If you pay in accordance with an enterprise agreement, you should ensure the base rates of pay under the agreement are no lower than the increased modern award rates of pay, particularly if the agreement was made a number of years ago.
Additionally, it is suggested you utilise the new financial year as an annual business health check-up to ensure you are compliant with any new legislation requirements and the abovementioned award wage obligations; especially any documentation that is associated with employment – e.g. employment agreement templates and/or policies.
The new financial year is also a good opportunity to schedule team and individual training and development for the year ahead.
NEED MORE INFORMATION?
Akyra can help your business to assist and support all your questions and concerns related to wage obligations. Please contact Akyra on 07 3204 8830 or book a free 30-minute consultation for an obligation-free conversation.
Disclaimer – Reliance on Content
The material distributed is general information only. The information supplied is not intended to be legal or other professional advice, nor should it be relied upon as such. You should seek legal or professional advice in relation to your specific situation.
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