6 June 2017

The Fair Work Commission delivered its annual wage review decision today. This decision will have a significant impact on all businesses and industries and over 1.86 million employees who are paid at the national minimum wage or modern award rates.

From 1 July 2017:

  • the national minimum wage will increase by 3.3 per cent to $18.29 per hour (and $694.90 per week for a full-time employee), an increase of $0.59 per hour.
  • all modern award rates will increase by 3.3 per cent (with weekly wages rounded to the nearest $0.10);

In reaching its decision to award a higher increase than previous years, the Commission took into consideration economic factors such as a 6.8% increase in the net national disposable income over the year to the December 2016, an increase in all national measures of inflation, a CPI increase of 2.1% over the year to the March quarter 2017, a sharp rise in labour productivity growth in 2016, an increase in profit growth in both total and non-mining industries and a generally positive outlook for business conditions.

The Commission also noted that unemployment had increased slightly from 5.7 per cent in April 2016 to 5.8 per cent in April 2017, and wages growth and growth in the WPI has been lower in 2016 than it was in 2015.

The Commission also took into account a range of social and other considerations. In particular, the ‘promotion of social inclusion through increased workforce participation’; ‘relative living standards and the needs of the low paid’, ‘the principle of equal remuneration for work of equal or comparable value’, and the ‘need to encourage collective bargaining’.

The Commission did acknowledge that the proposed increase to the national minimum wage and awards would not lift all award-reliant employees out of poverty, particularly those households with dependent children and a single-wage earner.

To read the full decision visit www.fwc.gov.au/documents/sites/wagereview2017

What do you need to do?
If you pay your workers at award level, the increase to minimum rates will take effect from the first full pay period commencing after 1 July 2017.  You will need to check awards and increase pay rates to comply with the increases in award rates.

The Office for Employment Relations can provide you with assistance on this and other employment related matters. Please visit our website: www.employmentrelations.catholic.org.au or contact Jane Bashiruddin at the Office for Employment Relations on 0447 238 432.