02 Jun 2015 Annual Wage Decision
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The Fair Work Commission has handed down the 2015 Annual Wage Review Decision.
The federal minimum wage and all Award based pay scales will increase by 2.5%. This equates to an increase of $16.00 per week to $656.90 for employees on the national minimum wage. In hourly rate terms the increase is $0.42 cents per hour for permanent employees. The 2.5% increase must also be applied to each wage classification in each Award and as such, the amount of the increase will be higher than the minimum increase as the Award classification rate of pay increases. The weekly Award rate of pay will be rounded to the nearest 10 cents. The increase in wages will flow on to employees that are less than 21 years of age proportionally depending on the junior worker provisions that are relevant to those employees.
The increase has effect from 1 July 2015.
Employers are reminded that they are legally obliged to comply with minimum wage and/or Award obligations and there are severe penalties for non-compliance.
Businesses that are paying their staff in excess of the award or enterprise agreement rates of pay may be entitled to offset the increase against their current arrangements, however, employers should keep in mind the staff management implications of not ensuring that staff wages are reviewed on an annual basis. Our experience is that employees expect an annual review and failing to address this issue can cause issues related to performance and staff turnover.
Employers using enterprise bargaining agreements or the old AWA’s should also ensure that they have their arrangements reviewed because, whilst awards do not generally have application to businesses that have agreements, there are certain minimum obligations under the Fair Work Act 2009 that must be complied with and only a review of your arrangements will ensure that you are compliant with your obligations.