On 19 June 2020, the Fair Work Commission increased the national minimum wage by 1.75% (equivalent to $13.00 per week). This follows an increase of 3% last year.
The new minimum wage will be $753.80 a week or $19.84 per hour and comes into effect from 1 July 2020 for all employees who are not covered by a Modern Award.
Minimum pay rates in all Modern Awards will also increase by 1.75%, however, these will not all come into effect on 1 July 2020. In light of COVID-19, the Fair Work Commission has decided to stagger this year’s increase, which is to be rolled out in three groups depending on your Modern Award.
Employees working in essential services such as frontline healthcare, social assistance, teaching and childcare will receive the increase from 1 July 2020. Those working in construction, manufacturing and a range of other industries will receive an increase from 1 November 2020 and those working in accommodation and food services, arts and recreation, aviation, retail and tourism will receive the increase from 1 February 2021.
Click here to see when your Modern Award pay rates will increase.
If you employ staff under a Modern Award, you will need to ensure that you are paying them at least their new minimum Award rates from the date of the increase. Refer to the Pay Guide for your Modern Award, available on the Fair Work Ombudsman website, to look up the new pay rates.
It is extremely important that you know which Award your staff are covered by, which classification they fall under and their relevant Award rates. Employers must not pay below any applicable Award rate, otherwise they will be underpaying staff and may be subject to an investigation by the Fair Work Ombudsman or the newly legislated Wage Inspectorate in Victoria (which may include fines and penalties).
For more information, see the Fair Work Ombudsman website, where there is plenty of information about employing staff available. The website also has an Award finder and each Award has a Pay Guide which simply sets out what Award rates apply, depending on who is working and when they are working. You can also use their P.A.C.T pay calculator to calculate base pay rates, allowances and penalty rates (including overtime).
To make sure you are paying your staff correctly, or for any other questions about employing staff, Robertson Hyetts is always here to help. We are focused on providing practical employment law advice to businesses in central Victoria and look to build ongoing relationships with businesses as trusted advisors.
Call our friendly employment lawyer, Kayla Kristensen, on 5434 6666 or 5472 1588 for advice or to understand how we can partner with your business.