03 Jun 2024
Libby Pallot, Ben Tallboys, Anthony Massaro, Mandi Xu, Abbey Burns, Kelly Ralph, Ashleigh Warren, Morgan Smithe, Shi Jing Wong, Harrison Gray, Emily Tang, Molly Lawlor, Jack Kneale, Sarah Newman and Taylor Dawson
On Monday 3 June 2024, the Fair Work Commission handed down its Annual Wage Review 2023-24 decision, announcing a 3.75% increase to the National Minimum Wage and modern award minimum wage rates from 1 July 2024.
President Justice Adam Hatcher of the Fair Work Commission noted that the decision will impact about 2.6 million Australians who are engaged in employment under minimum wage rate modern awards. As with recent years, job security, workforce participation, performance and competitiveness of the economy, the need to achieve gender equality and living standards, in accordance with the Fair Work Act, were the specific considerations in the Fair Work Commission’s decision.
The primary consideration of the Fair Work Commission in this decision was the ongoing cost-of-living pressures that modern award-reliant employees continue to experience in Australia.
This year’s increase to Modern Award Minimum Wages is less than last year which saw a 5.75% increase in minimum wages.The Commission noted that inflation is considerably lower than last year and considered that this increase is consistent with the forecast return of the inflation rate to below 3% in 2025. The Commission also took into account that modern-award reliant employees will likely receive the benefit of Stage 3 tax cuts and the budget cost-of-living measures that are predicted to increase disposable incomes over the next 12 months.
The outcome of the decision is that as at 1 July 2024:
- The National Minimum Wage will now be aligned with a higher minimum award classification and increase from $23.23 to $24.10 per hour (or an increase from $882.80 to $915.90 per week for a 38-hour week).
- Modern award minimum wages will increase by 3.75%.
A copy of the full decision is available here.
Employers will need to ensure that their employees covered by awards are paid at least the minimum wage in their award, even if an enterprise agreement applies to them.
It is also a timely reminder for employers that the superannuation guarantee rate also increases on 1 July 2024 from 11% to 11.5%.
Off the back of today’s decision, President Hatcher announced that a program for considering gender undervaluation issues in certain modern awards will commence shortly and is forecast to be completed by the time of next year’s review. These modern awards cover such workers as those in early childhood, disability home care and other social and community workers and dental assistants. President Hatcher stated that last year’s priority in the aged care sector, which saw significant wage increases (in addition to the Annual Wage Review in 2023/2024), has permitted the Commission to identify areas of focus for 2024/2025. Please see our previous alerts covering the decisions in the aged care sector more detail.
How can we help?
Please contact a member from our Workplace Relations, Employment and Safety team for advice regarding the Fair Work Commission Annual Wage Review or any other workplace relations matter.
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