The Fair Work Commission has recently announced a 2.5% increase to the national minimum wage in Australia.
Below we explore what’s changed and the steps companies can take to stay on top of pay rules for their employees.
How the annual review works
Each year, the Fair Work Commission reviews the minimum wages received by employees in the national workplace relations system. Many factors are considered, including submissions from the public, consultations and research commissioned by the FWC’s Expert Panel. On the 16th of June 2021, the FWC published their Annual Wage 2020-21 Review Decision.
For a bit of context, below outlines how the minimum wage has changed over the years:
- 2016 – $17.70 per hour
- 2017 – $18.29 per hour
- 2018 – $18.93 per hour
- 2019 – $19.49 per hour
- 2020 – $19.84 per hour
Two sides came to the table for the latest review; with unions lobbying for a 3.5% increase on behalf of employees, while employer groups pushed for a 1.1% rise.
Following the Annual Wage Review 2021, the FWC settled on a 2.5% increase, taking the national minimum wage up to $20.33 per hour, or $772.60 per week for full-time employees, based on a 38-hour week.
When will the changes be introduced?
Employees generally fall between one of two categories: those paid the national minimum wage, and those that are paid under an award (which applies to most employees).
For employees that fall under the national minimum wage rates, the increase will apply from July 1st, 2021.
But what about employees that are paid under an award? For this group, the changes will be staggered across industries, allowing sectors the hardest hit by COVID some time to get business back on track.
The changes to award rates will happen in three stages:
- Most awards will increase from 1 July 2021
- The Retail Award will increase from 1 September 2021 and;
- The 21 other awards will increase from 1 November 2021
Are your employees paid under the national minimum wage, or do they fall under an award? Either way, it’s an important time for a review, and to update your pay rates.
Here are some ideas on where to start:
- Fair Work’s Annual Wage Review page
- Information on minimum wages
- Information on modern awards
- Fair Work’s Pay and Conditions Calculator
Additionally, if you’re an existing customer, please feel free to get in touch to learn more about how to manage this change through Ento.
Managing awards the Ento way
Our software takes the stress out of changes to pay rates and awards by automating the application of rules defined by your business, so you can create cost efficiencies across your rosters and ensure employees are paid correctly every time.
Ento’s award interpretation engine can support thousands of unique and complex rule scenarios simultaneously while being fast enough to support real-time decision-making. Awards, or pay & compliance rules, are built, calculated, and maintained in Ento’s proprietary award interpretation engine.
As an example, your business may set up award configurations through Ento to cost staff shifts. When creating a roster through the platform, your rostering managers will get alerted about potential issues based on the compliance rules you’ve set. You’re then empowered to make decisions based on your business’ needs.
Ento has automated Award and EBA interpretation for hundreds of businesses. Our customers span healthcare, hospitality, retail, facility management, security, construction and many more.