April 19, 2023
How does the Annual Wage Review affect workers and small business owners? Each year, the Fair Work Commission reviews the National Minimum Wage and the minimum wages set out in awards. Cost of living and inflation are front of mind for both employers and employees, and this year’s Annual Wage Review is likely to see an increase in the minimum wage and award rates.
The Annual Wage Review is conducted by an Expert Panel, which takes submissions from interested groups, including the Federal Government, unions, and business lobby groups. The Federal Government’s submission to the Wage Review this year called for an increase to the minimum wage, though not specifying an amount. The Australian Chamber of Commerce and Industry has advocated for an increase of 2 per cent, at most.
The announcement will likely take place in early June and any increase to the national minimum wage will take effect in the first full pay period on or after 1 July 2024. Failure to pay employees at least the minimum rate that is set out in an applicable award can result in penalties, including requirements for back pay and fines.
The Fair Work Ombudsman uses its enforcement powers to issue compliance notices to employers, and recovered $14.8 million in unpaid wages in 2022-23. Small and medium businesses are subject to the same scrutiny as large businesses.
For business owners, this is a timely reminder to review employment agreements and payments to staff. You should be conscious of which awards cover your staff members, as award rates for each level increase commensurate with the national minimum wage increase.
It is also important to be aware of employee entitlements and set-offs, to ensure you are paying employees what they’re entitled to and avoiding future claims.
If you are not sure what award your employee is covered by, have a question about employment conditions or require any other assistance with employment and workplace matters contact Bailiwick Legal on 08 9321 5451 or email office@bailiwicklegal.com.au.
By Ciara Nalty (Solicitor)
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The above information is a summary and overview of the matters discussed. This publication does not constitute legal advice and you should seek legal or other professional advice before acting or relying on any of the content.
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