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Australian Minimum Wage Increase Announced!

A whopping 5.2% increase for the National Minimum Wage

The annual national minimum wage increase was announced on 15th June 2022 at 5.2% and is effective from 1st July 2022.


This increase has been sectioned into two parts - with all full-time weekly wages under $869.60 increasing by 5.2% and the remining Award rates impacted by a 4.6% increase. This results in a national minimum wage increase from $20.33 to $21.38 meaning those lowest paid workers will take home an extra $40 per week.


With a new government and focus on the cost of living and inflation; as well as CPI at 5.1% and the reserve bank interest rate increasing by 0.5% the rise is not surprising, but it is still pretty significant. 2021 saw only a 2.5% jump (likely due to the impacts of COVID -19) so it looks like the ALP is aiming to balance things out for 2022 and win some favour with lower paid Australians.


This along with high demand recruitment, the low numbers in the candidate market, and an increase to superannuation payments from 10% to 10.5% come July 1st, means that employers need to be smart about compensation, and benefits for their team.


Our number 1 challenge with clients at the moment is recruiting and retaining employees. So first up employers need to ensure that they are meeting the minimum obligations imposed by this national minimum wage increase for all Award based employees. This means conducting an Award review prior to the rate increases coming into play from your first pay run in July.


All employers should be checking:

  1. If they are certain which Award or Awards their business is covered under,

  2. What provisions within that Award impact wages, (such as penalty rates, allowances and loadings),

  3. Whether the classifications for their employees are still accurate, with a number of Awards having pay points linked to tenure and experience in the position,

  4. Whether the individual employees (once correctly classified) are paid in line with the new Award rates,

  5. And lastly, whether those rates are competitive in the current market.

Once you have your house in order you need to clearly communicate with your team and managers how the Award provisions apply to and impact your business. In some organisations this is a simple process, but for others this can be fraught with complexities and assumptions that can get the likes of even Woolworths in hot water.


Award underpayments have been a hot topic over the last 2 years and we don’t expect that to change in the coming 12 months. So it’s wise to take this increase seriously, do your checks and balances and save yourself the embarrassment of finding out later you were underpaying your team.


If you need any help or guidance from the Streamline HR team on anything related to Awards and wages please don’t hesitate to get in touch via info@streamlinehr.com.au


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