Fair Work Minimum Wage Decision Pending
It is that time of year again … we are starting to monitor the discussions and potential outcomes of Fair Work’s decision on changes to the national minimum wage. Decisions are typically released in mid-June with new rates normally coming into effect from the first full pay period after 1 July 2023.
So what is the narrative around the pending wage review? Well, we turn to the trusted ABC News for these insights:
- The federal government is advocating for a rise that ensures the nation’s lowest-paid workers are not going backwards. They are not necessarily arguing for the same increase to be applied to all levels.
- Unions have argued for a wage increase to keep pace with inflation, advocating for a 7% increase.
- Business groups want to see a more modest increase, to help contain inflation and ward off the threat of a recession. Andrew McKellar, CEO of the Australian Chamber of Commerce and Industry, explained their submission for a 3.5% increase was fair when coupled with the 0.5% Superannuation Guarantee increase also coming out of employer pockets.
- Economists say a reasonable minimum wage rise would be similar to the 5.2 per cent approved in 2022.
We will keep our clients up to date on decisions and implications as they occur.
Superannuation increases:
From 1 July 2023, the rate of Superannuation guarantee is increasing from 10.5% to 11%.
The increase in July is part of a longer-term uplift in the super guarantee rate which is on track to rise from 9.5% to 12% between 2021 and 2025
What this means for businesses:
From 1 July 2032 you will need to:
- make Superannuation contributions at the rate of 11%
- make these payments to all employees regardless of the amount they earn in the month
- check that your payroll platform has these updates scheduled to roll out (or make manual updates where necessary)
Don’t forget that if an employee does not provide you with a choice of super fund, you need to review the Stapled Super Fund information on the ATO website.
For questions on any of this, contact the ATO on 13 10 20.