While there are different minimum wages for different job types and awards, each of these comes from a Government legislated Minimum Wage, which all businesses in Australia must abide by. 3.5% increase in Minimum Wage for 2018 The largest Minimum Wage percentage increase since 2011 has been announced. It will be in effect from July 1, 2018. The new minimum wage is $719.20 per week, which is a minimum hourly rate of $18.93. The decision will have a significant impact on businesses, industries and more than 2.3 million employees who are paid the National Minimum Wage or minimum Modern Award rates.
The increase in Minimum Wage alone means that each impacted business will need to pay an extra $24.30 per week, per employee, from 1 July 2018.
In a recent Employsure survey of Australian employers, almost 70% said the minimum wage increase from 1 July would negatively impact their business.
On average, most employers surveyed said they could only afford to increase their hourly rates by 0.34 cents – less than half of what the increase was at 0.64 cents.
In response to the minimum wage, of the employers surveyed:
- 30.3% will raise their prices of their products or services
- 21.3% will reduce the number of staff in their business
- 19.1% will cut the number of hours or shifts of their staff
- 16.8% will work more hours in the business themselves
- Only 12% said it would not have an impact on their business
While wages may be the biggest cost to your business it is important to remember that employees can be your biggest asset too. The good news is, it does not have to be a choice. There are solutions that will protect both your financial interests as well as your staff.
Pocket-friendly methods to retain staff.
In a recent survey, Employsure small business clients were invited to share their views on the best methods to retain employees. The most common and successful methods of retaining employees according to the surveyed SMEs:
- Flexible working arrangements 38%
- Pay increases and bonuses 20%
- Training 16%
- Social events 2%
- Promotions 2%
- Improving health and safety 1%
The only way to protect yourself, your staff and your business is to know and meet your obligations as an employer. Download one of our free e-guide to better prepare your business.