Co-authored by Jace Coaldrake-Redhouse
As we move into the new financial year, the Fair Work Commission (FWC) has again released their annual update for employment law. Here’s what employers need to know about the changes:
Increases to National Minimum Wage and Award Wages
On 2 June 2023, the FWC announced the largest minimum wage increase since the Fair Work Act commenced:
- The National Minimum Wage will increase to $882.80 per week (or $23.23 per hour), up from $812.60 per week (or $21.38 per hour) in the previous financial year; and
- Minimum award wages will all increase by 5.75% above the current levels.
The increased rates take effect from the first full pay period following 1 July 2023. Rates were increased significantly following the last Annual Wage Review, representing an increase of up to 13.8% over the last two years.
The increases may also affect employers covered by an enterprise agreement where the minimum rates of pay mirror the underpinning Award. If this is the case, the rates will need to increase so they align with the applicable award minimums.
All employers should urgently review their obligations under applicable Modern Awards to ensure they are not exposed to underpayment claims or civil penalties.
Increase to the high income threshold for unfair dismissal claims
For all dismissals occurring after 1 July 2023, the high income threshold in unfair dismissals has increased to $167,500.
The compensation limit has also increased to $83,750.
Increase to the FWC’s filing fees
From 1 July 2023, the filing fee for dismissal, general protections, bullying and sexual harassment at work applications has increased to $83.30.
Increase to the Superannuation Guarantee
From 1 July 2023, the superannuation guarantee has increased to 11%, up from 10.5% in the previous financial year.
Changes to the Paid Parental Leave Scheme
Outside of the FWC’s yearly changes, from 1 July 2023 the Paid Parental Leave Amendment (Improvements for Families and Gender Equality) Act 2023 has come into place. The Act provides changes to paid parental leave entitlements for parents of children born or adopted from 1 July 2023.
The key change is that the current entitlement to 18 weeks’ paid parental leave pay and the current Dad and Partner Pay entitlement of two weeks can be combined into one payment. This means partnered couples will now be able to claim up to 20 weeks’ paid parental leave between them.
Partnered employees may now claim a maximum of 20 weeks’ pay between them, with each partner taking at least two weeks. Single parents will be entitled to the full 20 weeks’ paid leave.
The whole payment is now also more flexible. Eligible employees can now claim the 20 weeks’ leave in blocks until the child reaches the age of two.
It is vital that employers are prepared for these changes. If you have any concerns, please contact Coleman Greig’s Employment Law & WHS team.
