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FWC announces a 3% wage increase - effective from 1 July 2019

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

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Federal Circuit Court says company has case to answer for underpayment by subcontractor.

A company has failed to have a case summarily dismissed by claiming that it was not responsible for underpayment to workers by its subcontractor. The case was brought before the Federal Circuit Court by the Fair Work Ombudsman, and involves a South Australian company, Integrated Trolley Management (‘ITM’), one of many companies around Australia engaged to collect trolleys at various supermarkets. ITM subcontracts its services to Coastal Trolley Services (‘CTS’), who in turn subcontracts to South Jin Pty Ltd (‘South Jin’), the employer of the underpaid workers. The claim was made against South Jin as the employer and against CTS for accessorial liability.

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Deadline 1 March 2020 - How do the new annualised salary provisions affect your business?

A large number of employers will be affected by the introduction of new annualised salary provisions from 1 March 2020. Over 20 modern awards will have the new or amended annualised salary provisions and it may mean big (or small) changes for your business.

We have recently seen an increasing number of underpayment claims and a renewed focus by the Fair Work Ombudsman on pursuing these claims. Even if the new provisions do not apply to your business, it is a timely reminder to undertake an assessment of your agreements and record-keeping procedures to ensure you are compliant and minimise the risk of being on the receiving end of an underpayment claim.

Do you currently pay a salary to your award employees?

If you are already paying a salary to affected employees, you will fall into one of the following categories:

  1. Paying salary but no written agreement or employment contract
  2. Paying salary under an agreement or employment contract that has no buyout or offset clauses (or clauses are non-compliant)
  3. Paying
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