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Minimum Wage Review 2012

Minimum Wage Review 2012

Fair Work Australia’s minimum wage panel released its 2012 Annual Minimum Wage Decision on Friday, 1 June 2012. Under the Fair Work Act 2009, the Minimum Wage Panel of Fair Work Australia must conduct an annual wage review in each financial year.

The decision handed down by the Panel on Friday increases the national minimum wage to $606.40 per week or $15.96 per hour. This constitutes an increase of $17.10 per week or 45 cents per hour being the equivalent of a 2.9% minimum wage increase. The decision takes effect from the first pay period commencing on or after 1 July 2012

The national minimum wage order will contain a number of special wage provisions for award / agreement free employees, including juniors and employees with disabilities.

The 2012 Minimum Wage Decision applies to all employees covered by the national workplace relations system. The decision increases pay rates for minimum wage and modern award employees, all transitional Australian Pay and Classification Scale employees, State reference transitional award and Division 2B State enterprise award employees. The decision will not apply to:

  • employers who are sole traders and partnerships in Western Australia;
  • corporations in Western Australia whose main activities are not trading or financial;
  • state government public sector employers and employees (except in Victoria); and
  • some local government employers and employees.

If an employee is paid above the relevant modern award base rate of pay, 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.

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 2012.

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.

Authors: Andrew Bland, Principal and Andrew Gordon, Solicitor

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