Prepare for a 2.5% increase to minimum wages.
The Fair Work Commission (FWC) announced yesterday its annual wage decision in another split minimum wage decision, similar to last year where it was deemed that some industries warrant a deferral of the commencement date due to the impact of Covid-19.
The National Minimum Wage will increase by 2.5% per cent to $20.33 per hour, a $0.49 hourly rate rise. A full-time adult employee will receive $772.60 per week, an increase of $18.80 per week.
The FWC has determined that Modern Award increases will be rolled out in stages to recognise that the impact of the COVID-19 pandemic has not been consistent across all sectors of industry. Modern Awards have been grouped into three ‘clusters’, being lagging recovery, almost recovered, and fully recovered. This approach is intended to lessen the impact on the industries most affected by the pandemic.
For the vast majority of Awards, the 2.5% minimum wage increase comes into effect in the first pay period on or after 1 July 2021 at the same time as the 0.5% increase to the superannuation guarantee rate.
However, general retail will be delayed until the first full pay period on or after 1 September 2021. Workers covered by more than 20 Awards, including tourism, hospitality, restaurant, fitness, hair and beauty, and aviation will increase on 1 November 2021. See table below.
Next Steps for Employers
- Employers who pay minimum wage rates under a Modern Award will be required to increase employees’ rates in the first pay period on or after 1 July 2021, 1 September 2021 or 1 November 2021 depending upon which modern Award applies.
- Check the table below to see which implementation date applies to Awards in your business.
- Should your business pay above the minimum wage rates you may be able to absorb the increases without making any changes.
List of Award Clusters
|
Implementation Date |
Award |
|
1 July 2021 |
All Modern Awards except those below |
|
1 September 2021 |
General Retail Industry Award 2020 |
| 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 |
Contact us if you need assistance in reviewing your pay rates and penalty rates. Stay tuned for further updates on Awards, allowances and thresholds as we approach the end of this financial year