NORMANS ALERT: Increases to employee minimum wage from 1 July 2024 - what these changes mean for employers
Increases to employee minimum wage from 1 July 2024 – what these changes mean for employers
Employers should be aware of several increases to employee minimum entitlements that will come into effect from 1 July 2024. These changes include increases to modern award minimum rates of pay and the National Minimum Wage (NMW).
The Fair Work Commission (FWC) has recently delivered its decision in the Annual Wage Review 2023-24 (the Decision). As part of the Decision, the FWC has increased award minimum rates of pay by 3.75%. This increase will take effect from the first full pay period on or after 1 July 2024, and applies to all Australian employees who are paid at the minimum rates specified in a modern award.
The Decision has also resulted in an increase to the NMW by 3.75%. From the first full pay period on or after 1 July 2024, the NMW will increase from $23.23 per hour to $24.10 per hour. This corresponds with a weekly minimum wage increase from $882.80 per week to $915.90 per week. This increase must be paid to all employees who receive the NMW.
In determining the level of increase, strong consideration was given to the cost-of-living pressures experienced by modern award-reliant employees although the FWC noted that other measures were in place to increase disposable incomes for such workers such as the Stage 3 tax cuts and cost of living measures in the Federal Budget. The FWC found it was not appropriate at this time to increase award wages by any amount above the inflation rate because labour productivity is no higher than it was four years ago, and productivity growth has only recently returned to positive territory.
This alert serves as a timely reminder to employers to ensure that employees are paid in accordance with their applicable minimum entitlements from the first full pay period on or after 1 July 2024. Any employees covered by a modern award, or employees receiving the NMW must be paid at their new applicable minimum rate.
Should you wish to discuss any material contained in this article, please contact Sathish Dasan on +61 8 8210 1253 or sdasan@normans.com.au, Lincoln Smith on +61 8 8210 1203 or lsmith@normans.com.au or Annabelle Narayan on +61 8 8210 1292 or anarayan@normans.com.au.
