3.5% increase to National Minimum Wage

The Fair Work Commission has conducted its annual review of the National Minimum Wage, resulting in an increase of 3.5 per cent. The increase will see minimum wages rise by $24.30 a week for over two million workers.

The new National Minimum Wage, and commensurate increases under Modern Awards, will be effective from 1 July 2018.

What do you need to know?

• For employees not covered by a Modern Award, employers should ensure that those employees are paid at least $719.20 per week or $18.93 per hour.
• For employees who are currently paid under a Modern Award:
  • if they are currently paid equal to the applicable Modern Award minimum wage, employers should increase their wages by 3.5%, commencing the first pay cycle after 1 July 2018;
  • if they are currently paid above the minimum wages under the Modern Award, employers should still perform a reconciliation of their wages (taking into account applicable overtime rates, penalties, allowances and loadings) to ensure they will meet the new minimum wages;
• For employers who are offering new employment contracts or negotiating (or anticipate negotiating) new enterprise agreements, negotiations should consider the minimum wages increase to ensure rates are compliant from 1 July 2018.

If you require assistance in determining the application or any implications of the new National Minimum Wage increase, please contact our Employment, Safety and Migration team.

This article was written by Cinzia Pietrolungo, Lawyer – Employment, Safety and Migration.