The Fair Work Commission’s (Commission) Expert Panel for annual wage reviews (Panel) handed down its Annual Wage Review decision on 15 June 2022. The Panel approved a $40 per week increase to the National Minimum Wage (NMW), which amounts to an increase of 5.2%. From 1 July, the NMW will be $21.38 an hour (or $812.60 per week), which the Panel observed would protect the real value of wages of the lowest-paid workers.
In an unusual move, the Panel also decided to increase modern award minimum wages by 4.6% subject to a minimum increase for “low-paid” classifications of $40 per week (based on a 38-hour week for a full-time adult employee). In practical terms, this means that modern award minimum wage rates above $869.60 per week will receive a 4.6% increase, whereas wage rates below $869.60 per week will be increased by $40 per week.
The Panel noted that there had been a fall in the real value of the NMW and modern award minimum wages because of the modest increases awarded last year and changes in the economic context weighed in favour of an increase in the NMW and modern award minimum wages. The Panel said it was conscious that the low paid are particularly vulnerable in the context of rising inflation and that there had been a sharp rise in the cost of living since the previous year’s review, which justified the perhaps higher than anticipated increase.
The Panel was also satisfied that exceptional circumstances exist such as to warrant a delayed operative date for modern awards in the aviation, tourism and hospitality sectors (who will have until 1 October 2022 to pass on the increases).
To access the Commission’s full decision, please click Annual Wage Review Decision or to discuss the decision in more detail, please feel free to contact a member of the HMB Law team on (03) 9448 9600.
The above is general information and should not be taken as legal advice.
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