Article Category - Employment Law By Angus Edwards 16 June 2021

The Fair Work Commission has determined that the National Minimum Wage and Modern Award Minimum Wages will increase by 2.5% from 1 July 2021.

The new National Minimum Wage will be $772.60 per week or $20.33 per hour. This constitutes an increase of $18.80 per week to the weekly rate, or $0.49 per hour to the hourly rate.

As with last year's award wage increase, the Fair Work Commission has delayed the pay rise for award employees in aviation, tourism, fitness, and certain retail sectors. The increase for these industries will take effect on November 1, while the remaining retail workers on award conditions will get their pay rise from September 1.

Here are our tips for Business owners to avoid potential underpayment claims:

  1. Ensure that you are paying your employees under the correct classification in the relevant Award or Enterprise Agreement. Write down a list of tasks that an employee will do in a typical workday and compare this to the duties set out in each Award classification.
  2. Do not outsource your understanding of payroll to your payroll software. Software does not always get it right, so it is important that you avoid over-reliance by ensuring that you understand the calculations behind your payroll system.
  3. Put a note in your diary to check for Award wage increases on 1 July each year. Also diarise the birthdays of any junior employees, which ensures that you do not overlook any age-based wage increases (and also makes you look like a great boss!)
  4. Be alert to the factors that can vary an employee's normal wages. These factors include work on weekends or public holidays, work beyond certain hours, responsibilities for opening or closing the business, distance travelled to the workplace, and certain types of work that attract special allowances.
  5. If in doubt, seek legal advice. The Fair Work Act has 960 sections and is a quarter of a million words in length, so there is nothing wrong with calling us if you need assistance.

It's also a timely reminder that Employer Superannuation contributions are increasing from 9.5% to 10% from 1 July 2021. So now is the time to start looking at your payroll system to understand when and how this will need to be managed.

At Kenny Spring, our fixed-fee "On Call" retainer allows business owners to pick up the phone without fear that they are being charged for every minute. If you like the sound of having a solicitor "On Call" to answer your employment law and payroll questions, please contact our office to discuss on (02) 6331 2911. We're here to help!

Angus Edwards | Principal