Minimum Wage Increased by 8.65% & Award Wages Increased by 5.75% from July 1.

The Fair Work Commission has decided to increase the National Minimum Wage by 8.65%, and Modern Award wages by 5.75% from the first full pay cycle after 1 July 2023.

That means, for Non-Award employees, an increase from $812.60 per week or $21.38 per hour to $882.80 per week or $23.23 per hour.

For Award based employees, their minimum wages payable will increase by the 5.75% value.

Good to know, but what’s next?
The increase to the minimum wage and to modern awards will operate from 1 July 2023.

That means, from the beginning of your first full pay cycle on or after 1 July 2023, you’ll need to ensure you’ve applied the increases to any employees who are due to receive one.

Who gets an increase, and who doesn’t?
If your people are the subject of a modern award and you don’t know which modern award and/or minimum rate you need to be paying, contact us for assistance. While we’re at it, we can review your wage rates to see which of your employees’ pay rates can simply absorb the minimum increase into your existing pay arrangements, and which employees will fall below the minimum lawful payable wage.

Any employee who’s wages are not sufficiently high enough to absorb the increase will need to have their remuneration adjusted accordingly.

Please – be cautious here, wage theft criminalization is just around the corner with the intended penalties harsh enough to significantly impact your business, and Directors, personally.

A reminder for enterprise agreement covered employers – the rate increase may also affect you. Specifically, enterprise agreement-based employees cannot be paid less than the minimum base rate that they would be paid under an applicable modern award.

You should review the base rates in your agreement and compare this to the rate each employee would receive under the relevant modern award after the July 1 increases are considered.

You should be aware of all the mechanisms around wage increases in your agreement, also – there may be cause for amendments that we haven’t thought about as part of the commission decision.

The Workplace AS team can assist you with this process.