Last week the Fair Work Commission increased the national minimum wage and the minimum wage rates in modern awards by 3%, compared to 2.6% last year.
From 1 July 2014, the national minimum wage will be $16.87 per hour, or $640.90 per week―an increase of $18.70 per week. The minimum wage panel said the reasons for the additional increase are:
- there has been almost no growth in the real value of award rates over a period when other employees have had substantial wage increases
- the living standards of award-reliant workers has deteriorated
- there has been a recent widespread improvement in labour productivity growth
- there have been historically low levels of real unit labour costs
- there is an absence, in aggregate, of cost pressures from the labour market.
It was acknowledged by the minimum wage panel that the superannuation guarantee would be rising by 0.25% as of 1 July 2014 and this was considered to be a moderating factor.
The national minimum wage applies to all employees who are not covered by an award or enterprise agreement; and there are special national minimum wages for trainees, apprentices, juniors and employees with a disability.
The Fair Work Commission has also increased the loading for casual employees not covered by a modern award or enterprise agreement from 24% to 25%. However, no change has been made to the casual loadings contained in modern awards.
All employers should ensure they are ready to apply the above increases.
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