In brief - National employers must comply with new obligations
under national workplace relations system
On 1 July 2014, changes took effect to the national minimum
wage, Superannuation Guarantee contributions, transitional
arrangements and penalty rates under the Restaurant Industry Award.
The Restart Wage Subsidy also commenced on this date.
3% increase to minimum wage
The minimum wage increased by 3% as a result of the Fair Work
annual wage review decision on 4 June 2014. The increase in the
minimum wage affects national system employees who are covered by a
modern award or industrial agreement, as well as employees who are
not covered by either an award or industrial agreement.
Employers paying their employees under a modern award will need
to review their pay rates to ensure they are paying their employees
the correct amount.
Award or agreement-free employees will need to be paid in
accordance with the national minimum wage order. Currently, the
national minimum wage rate is $640.90 per week, calculated on the
basis of a week of 38 ordinary hours, or $16.81 per hour.
There are additional considerations that need to be taken into
account for casuals, apprentices, junior employees and employees
with a disability.
Further, the high income threshold has also increased to
Increase in Superannuation Guarantee contributions
From 1 July 2014, the compulsory Superannuation Guarantee
contributions have increased from 9.25% to 9.5%. This will
eventually increase to 12% by July 2022.
Transitional arrangements in modern awards
In January 2010, the modern awards were introduced. The new
rates in the modern awards were phased in over a four year period.
As of 1 July 2014, these transitional provisions are no longer
applicable and the full rates in modern awards are now in
Employers who are paying their employees in accordance with a
modern award will need to ensure that they are no longer
transitioning employees and are paying in accordance with the full
modern award rate.
However, there are a few modern awards that contain award
specific transitional provisions and as such, it is imperative that
employers review the award prior to making any decision to change
an employee's rate of pay or conditions.
Employers covered by a transitional agreement will also need to
check that their minimum rates are not below the award rates.
Decrease in penalty rates for some casual restaurant
Significantly, as of 1 July 2014, the Sunday penalty rates for
casual employees below the Level 3 classification have decreased by
Long experience representing many of Australia's leading employers has taught us that in employment litigation the identity of an employee's representative is a major factor in how employee litigation runs.
Australian employees receive certain entitlements (such as annual leave and superannuation) where contractors do not.
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