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Changes to the Retail Award and Super Guarantee Increase

The world of HR legislation always becomes a bit busier as we approach End of Financial Year, with a number of developments on the horizon that employers need to be aware of.


Who needs to know?

Anyone in the retail industry employing juniors (i.e., people under the age of 21).

What is the full story?

As part of its four-yearly review of Modern Awards, the Fair Work Commission has made a change to the General Retail Industry Award. The changes mean that the junior pay rate, which previously applied to all employees under 21, can now only be paid to juniors working at Classification Levels 1, 2 or 3.

Trade qualified junior employees, or those working at Classification Level 4 or higher, must now be paid the full adult rate.

When did this come into effect?

Employers were required to implement the changes from the first full pay period on or after May 1st, 2021.

What should I do?

If you operate in the retail sector and employ people under the age of 21, get in touch so we can ensure you are fully compliant with the changes to the Retail Award.


What is the Superannuation Guarantee?

The Superannuation Guarantee (SG) is the minimum percentage of a salary that an employer must contribute to an employee’s Superannuation fund. It is legislated by the Australian Government and controlled by the Australian Taxation Office.

Right. And what does it stand at currently?

It has been 9.5% of Ordinary Time Earnings (the amount an employee earns for their ordinary hours of work) since July 2014.

Remind me. Who is entitled to Super?

Generally speaking, employees over 18 years of age earning in excess of $450 per month are entitled to Super. Full details can be found on the ATO website

OK, so what is it going up to and when?

Initially, it will be going up by 0.5% to 10% on July 1st, 2021. The plan is to then increase it by 0.5% every July until it reaches 12% in 2025.

Is anything else changing?

Yes, but not for another year. You know that $450 per month eligibility requirement for Superannuation we mentioned earlier? Although it is not yet law, it has been announced that this will be removed on July 1st, 2022. After that date, all employees will be entitled to Superannuation, regardless of their earnings.

Can I avoid this costing me money?

If your team are employed on a total package basis (i.e., their salaries are inclusive of Superannuation), you might be able to cover the cost of the Superannuation Guarantee increase by reducing their take-home pay.

If you are thinking of doing this, we strongly advise you get in touch so we can ensure it is done legally (and does not result in your entire team walking out the door!)

What do I need to do before July 1?

* Check with your payroll software provider to ensure this change will automatically be applied to your software from July 1, 2021.

* Ensure your employment contracts do not include a specific Superannuation Guarantee of 9.5% (and where this is the case, update, and re-issue your contracts).

* Commence a process of reviewing any individual salary sacrifice or after-tax superannuation contribution arrangements you have with your team.

* Use this as an opportunity to do some Superannuation housekeeping and ensure your Superannuation obligations have been met up until June 30, 2021.

* As mentioned above, if you are considering offsetting the increase against your employees’ total remuneration, give us a call first.


If you would like specific advice and assistance to manage any of the above within your

workplace, please contact your primary consultant or get in touch here

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