Minimum wage rises effective 1 July 2019
The Fair Work Commission’s Wage Review Panel handed down its 2018/19 minimum wage review on 30 May, awarding a 3% increase in the minimum wage and in modern award rates of pay effective from 1 July 2019
New national minimum wage
The national minimum wage (NMW) will increase to $19.49 per hour or $740.80 per week (previously $18.93 per hour or $719.20 per week), a rise of $21.60 per week.
It is understood that 21% of Australians will be affected by this rise:
- The National minimum wage is set to increase to $740.80 per week or $19.49 per hour (up 3%);
- Modern Award minimum wages will increase by 3%;
- The National Training wage will increase by 3%; and
- Modern Award minimum wages for those employees with a disability, and for those with training arrangements will increase by 3%.
Employers – Who is affected, what do they need to do and when?
Employers will be required to review the employment contracts of any employees that are:
- paid wages at the minimum wage (or within 3% of that);
- are under a modern award; or
- other industrial instrument such as an Enterprise Agreement.
When do the new rates take effect?
They apply from the first full pay period commencing on or after 1 July 2019. So, if your pay week is from Wednesday to Tuesday, the new rates take effect on Wednesday 3 July.
Other Modern Award changes to apply from 1 July
Casual loading increase: Business Equipment Award 2010
From 1 July 2019, the casual loading in the Business Equipment Award 2010 will be 24%. A decision by the Fair Work Commission in 2016 resulted in an incremental increase to the casual loading in the award by 1 per cent from 1 July 2016 and, each subsequent year until it reaches 25 per cent by 1 July 2020.
Base rates of pay, Allowance increase: Pharmacy Award 2010 As part of its four-year review of modern awards, the Commission recently announced a 5% increase to base pay rates in the Pharmacy Award 2010 for some employees. The increase will be in addition to the recent Annual Wage Review decision. In addition, from 1 October 2019, an additional allowance of $106.40 per week will be paid to an employee classified as a Pharmacist, Experienced Pharmacist, Pharmacist in Charge or Pharmacist Manager who is required by the employer to perform Home Medicine Reviews or Residential Medication Management Reviews. The 5% wage increase will be introduced in two stages – 1 July 2019 and 1 October 2019. A 2.5% increase will happen at each stage, to help employers adjust to the changes. The wage increases apply from the first full pay periods commencing on or after 1 July 2019 and 1 October 2019. The new allowance will apply from the first full pay period starting on or after 1 October 2019. Businesses affected by the decision will be required to pay the 5% wage increase as well as the 3.0% Annual Wage Review increase.
How the increase in the national minimum wage will impact enterprise agreements
Employers who have an enterprise agreement in operation (including those that have passed their nominal expiry date) must ensure that the base rate of pay in the agreement does not result in any employee being paid less than the relevant modern award pay rate or, if no award applies, the NMW.
Where do I get the new rates?
The Fairwork Ombusdman provides a handy Pay and Conditions Tool. Just remember to set the date to 1 July.
You can also get the new award rates from updated downloadable pay guides which have the minimum pay rates for full-time, part-time and casual employees in an award.
If you have any questions regarding the minimum wage increase, how the increase may impact wage rates in your enterprise agreement, or about any of the information above, you can contact the Fairwork Ombudsman or the friendly team here at Business Wise for assistance.