The Fair Work Commission Expert Panel is required to
conduct and complete a review of the national minimum wage and
minimum wages in modern awards each financial year.
On 31 May 2016, the Panel completed the review and ruled to
increase the national minimum wage and award classifications.
For award covered employees, the award classifications will
increase by 2.4% with weekly wages to be rounded to the nearest 10
cents. The national minimum wage will increase to $672.70 per week
or $17.70 per hour.
The increases will apply from 1 July 2016.
In determining to increase the national minimum wage and award
classifications, the Panel considered the following factors;
The economic environment has improved and labour market
conditions are stronger.
Inflation and wage growth are at historically low levels.
Company profits in the non-mining sectors grew in 2015.
The outlook for the Australian economy remains generally
The relative position of minimum wage reliant employees has
deteriorated over the past decade and many of these employees live
in very low income households and have lower living standards than
Women are over-represented in the minimum wage reliant
employees sector and an increase to the minimum wage will move
towards decreasing the gender pay gap.
The Fair Work Commission is in the process of formally updating
the modern award classifications. It is anticipated that the
updated modern awards will be available on the Fair Work Commission
website by mid-June 2016.
Employers with award covered employees will need to review the
updated modern award classifications to ensure that the minimum
wage increases are implemented from 1 July 2016.
Failure to implement the minimum wage increases may result in
underpayments to employees, which can result in prosecutions and
the imposition of civil penalties by the Fair Work Ombudsman.
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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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