National minimum wage to increase by a “modest” $16 per week

Moments ago, the Fair Work Commission (the “FWC”) handed down the decision in its annual wage review.

From 1 July 2015, the national minimum wage will be $656.90 per week (or $17.89 per hour). This represents an increase of $16 per week from the current national minimum wage of $640.90 per week.

The decision follows months of submissions from and consultations with government, employer and employee stakeholders, as well as research and reports by the FWC’s Expert Panel.

Following the decision, minimum wage rates in modern awards will be increased by 2.5% and a new national minimum wage order will be made with respect to award free employees.

What does this mean for employers?

  • Subject to the requirements of relevant modern awards, enterprise agreements and employment contracts, from 1 July 2015, employers must ensure that their employees are paid at least $656.90 per week (or $17.89 per hour).
  • Employers must be aware of the award or agreement (if any) that applies to their employees and ensure wages are paid pursuant to it, noting that minimum wage rates in modern awards will be increased by 2.5%.
  • An employer who fails to pay wages in accordance with the national minimum wage order or requirements of a relevant award or agreement will be exposed to liability for breach of the Fair Work Act 2009 (Cth).