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Wage Increase – How Does This Affect You?

Fair Work Commission announced a wage increase from 1 July 2017.

wages increaseIf you employ staff you need to be aware of the changes that the wage increase may have on your business.

When does the wage increase start?

The wages increase will apply to base rates of pay form the first full pay period starting on or after 1 July 2017. So for your first pay in July, if the pay period spans June and July the 2016-2017 rates apply. The rates only apply to the first full pay period paid in July.

 

Who does the wage increase apply to?

The wage increase applies to employees that get their pay rates from the national minimum wage, a modern award or in some cases a registered agreement. Most employees are covered by an award. If you’re not sure which award applies to you or your employees you can use Find my award on Fair Work website.

 

Changes to penalty rates

Changes to penalty rates affect the Hospitality, Pharmacy, Fast Food, Retail and Restaurant industries and come into effect on 1 July 2017. Read more about penalty rates here.

 

Employers checklist for 1 July 2017

  • No changes take effect until the first full pay period on or after 1 July 2017.
  • An employer who has award free employees must at least pay them at the National Minimum Wage rate from the first full pay period on or after 1 July 2017.
  • An employer with award free junior employees must pay those employees at the appropriate percentage of the National Minimum Wage rate from the first full pay period on or after 1 July 2017.
  • Any employer who pays their employees at the minimum award rate of pay will be required to increase pay rates by 3.3% from the first full pay period on or after 1 July 2017.
  • The incoming wage increase to the award rates of pay can be absorbed into an employee’s current rates of pay if the result leaves the pay rate at least equal to the adjusted Award minimum rates.

 

Where to get wage increase help.

The Fair Work Ombudsman has a great tool on their website called P.A.C.T – the Pay and Conditions Tool. This will help you work out which award you should be applied to your employees and what the wage increase will be for your business.

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