Increases to National Minimum Wage, Modern Award Rates & Employer Superannuation Contributions
The increases to the Modern Award rates of pay and the National Minimum Wage are now effective from the first full pay period starting on or after 1 July 2024 as follows:
Modern Award Rate Increases: The Modern Award minimum wage rates will increase by 3.75%. This increase will apply from the first full pay period on or after 1 July 2024.
National Minimum Wage Increase: The National Minimum Wage will be increased by the same 3.75% to $915.90 per week, or $24.10 per hour. This increase will also apply from the first full pay period on or after 1 July 2024.
The Fair Work Ombudsman has now released the updated Modern Award Pay Guides which will apply from the first full pay period starting on or after 1 July 2024: Pay guides - Fair Work Ombudsman.
Remember that you will need to check the relevant minimum rates of pay, as well as other monetary rates payable under applicable Modern Awards, including all allowances, loadings etc, and review your wage arrangements in place, and implement the required wage increases from the first full pay period starting on or after 1 July 2024.
It will be critical for all employers to ensure compliance with relevant Modern Awards and minimum rates of pay, noting that there will be criminal liability for intentional wages theft being introduced no earlier than 1 January 2025, with a maximum of 10 years in prison and significant penalties, see Criminalising wage underpayments and other issues - Fair Work Ombudsman.
Employer superannuation contributions have now also increased from 11% to 11.5% on and from 1 July 2024, see: Super guarantee | Australian Taxation Office (ato.gov.au). The Fair Work Commission has taken this increase into account as a moderating factor, as well as the fact that Modern Award reliant employees will also soon receive the benefit of the Stage 3 tax cuts and Federal Government budget cost-of-living measures. Employers should be aware that Employer superannuation contributions will increase again on 1 July 2025 to 12%.
There are also a range of other IR changes now in place and more to come that businesses should start planning for. At IR Legal Solutions, we have prepared detailed client updates, so just get in contact with us if you would like more information on the changes and how they will impact your business.
Further, the High-Income Threshold under the Fair Work Act 2009 (Cth) has also now been increased to $175,000 effective from 1 July 2024. This means the compensation limit for unfair dismissal claims will now be limited to $87,500 for dismissals occurring on or after 1 July 2024.
If you have any questions about the impact of these wage increases, or what your business needs to do in light of the raft of recent and upcoming IR changes still to come, please contact IR Legal Solutions to discuss.
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