Most Read Contributor in Australia, September 2016
Each financial year, the Fair Work Commission (Commission) is
required to review modern award minimum wages and the national
minimum wage and make a decision as to whether to increase them.
Earlier this month, the Commission conducted its review and decided
on increasing the minimum wages by 3%.
Here is the breakdown of this increase to the national minimum
From 1 July 2014,
National Minimum Wage will be...
Significance for the agribusiness industry
This will have a widespread impact on the industry which employs
many award-covered employees and employees who are paid the
national minimum wage. The increase in labour costs will be
particularly unwelcome for farmers or businesses who have been
affected by the drought and are struggling with increased
competition and costs of business.
What the Fair Work Commission considered in its
In its decision, the Fair Work Commission considered a wide
range of factors including:
the economic outlook for 2014-2015;
employment growth and the unemployment rate expected for
the increase to the Superannuation Guarantee rate from 9.25% to
9.5% from 1 July 2014;
relative living standards and the needs of low paid workers;
living costs and inflation.
As part of the annual review, parties are also welcome to make
submissions seeking different treatment to certain awards or
seeking that the Commission takes into account certain concerns of
particular industries. However, the Commission will only agree to
treat a particular industry or employees of a particular award
differently if parties are able to show that there are exceptional
circumstances that justify different minimum wages being applied to
Submissions regarding the hardships faced by
This year, the Chamber of Commerce and Industry Queensland
(CCIQ) and the National Farmers' Federation
(NFF) made submissions regarding the difficult
circumstances faced by famers and businesses in the agribusiness
industry as a result of the ongoing drought.
The CCIQ submitted that despite drought assistance being offered
by the Government, agribusinesses in drought affected areas were
still significantly impacted and were experiencing financial
The NFF described the impact on businesses including livestock
producers being forced to increase the number of stock to slaughter
and farmers reducing the planting of crops. It submitted how this
drop in farming productivity has had an impact on the national
economy, but also a compounding effect on small businesses in
regional country towns.
Based on this common concern, the two groups sought different
The CCIQ sought an exemption from any increase to minimum wages
for businesses predominantly in the farming and agriculture supply
chain. It suggested that this exempt group could be limited to
those businesses that had applied for drought relief and operate
under the awards which cover the agricultural industry.
On the other hand, the NFF simply sought that the Commission
consider the hardships as a result of the drought in making any
determination to increase the minimum wages.
In accordance with the NFF's suggestion, the Commission
acknowledged the difficulties faced by the industry and took this
into account in its assessment of the national economy and its
decision to increase minimum wages. However, it rejected CCIQ's
suggestion and found that there was insufficient evidence that the
drought constituted exceptional circumstances which would justify
exempting agribusinesses affected by the drought.
The increases are to take effect from 1 July 2014.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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Australian employees receive certain entitlements (such as annual leave and superannuation) where contractors do not.
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