The Fair Work Commission has released its 2019 Annual Minimum Wage Decision, awarding a 3% increase to the national minimum wage and award-reliant employees.
The FWC decision increases the national minimum wage to $740.80 – or $19.49 an hour. This constitutes an increase of $21.60 a week or 57 cents an hour. All award rates of pay will increase by 3% with effect from the first pay period commencing on or after 1 July 2019.
The FWC panel stated that while business conditions have moderated from the high levels in early 2018, the forecast is for continued growth in the economy and strong performance in the labour market. The panel considered that its forecast provided an opportunity to improve the living standards of those relying on award rates and the minimum wage. Noting the disproportionately large number of women in this group, the panel (consisting of five men and two women) expressed a belief that an increase would assist in reducing the gender pay gap.
It was acknowledged that the level of increase decided upon will not lead to inflationary pressure and is highly unlikely to have any measurable negative impact on employment.
Who is affected?
The 2019 Minimum Wage Decision applies to all employees covered by the national workplace relations system.
If an employee is paid above the relevant modern award base rate of pay then, provided an employee’s over-award payment still results in them being paid at least the new base rate of pay, the employer will be considered to have met their obligation with respect to the minimum wage increase.
What employers need to do?
Employers have a legal responsibility to ensure that all of their employees are paid at least what they would receive under a modern award, registered agreement or national minimum wage order. We recommend a review of your payroll obligations to ensure you are meeting your responsibilities in readiness for 1 July 2019.
Should you require any assistance in reviewing your payroll obligations or if you have any questions about this wage review and its impact, please contact us.