FWO updates guidance on minimum wage increase

The Fair Work Ombudsman (FWO) has outlined the next steps for employees and businesses ahead of the new minimum wage changes on 1 July.

16 June 2022 

Following its Annual Wage Review 2021-22 , the Fair Work Commission (FWC) has increased the National Minimum Wage by 5.2%, which amounts to $40 a week.

Award minimum wages will increase by 4.6%, which is subject to a minimum increase for award classifications of $40 per week and based on a 38-hour week for a full-time employee.

The FWC will now issue draft determinations and orders about how their decision affects awards. The FWC will then update the pay rates for each award.

The FWO said it was currently working to update its pay tools, information and resources with the new rates. 

“We’re working on updating our pay tools with the new rates and will notify subscribers when they’re available,” the FWO said.

“We expect to have these updated on 1 July 2022 for the first set of awards affected.

“While we’re updating our website and tools, you can subscribe to email updates and we’ll let you know when the new rates are available in our pay tools.”

“You can also read the FWC's decision summary and decision on the FWC website.”

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The National Minimum Wage applies to employees not covered by an award or registered agreement.

“Most employees are covered by an award. Awards are legal documents that outline the minimum pay rates and conditions of employment. If you’re not sure which award applies to you, use our Find my award tool,” the FWO said.

“Awards cover many different industries and occupations so it's important to get it right.”

The FWO said for employees covered by a registered agreement, the minimum wage increase may apply. This is because the base pay rate is a registered agreement that can’t be less than the base pay rate in the relevant award. 

"If you're covered by an enterprise agreement or other registered agreement, check the agreement for the minimum pay rates. You can find registered agreements on the Fair Work Commission's website," the FWO said.

The new minimum wage will apply from the first full pay period on or after 1 July 2022. 

"This means if you have a weekly pay period that starts on Mondays, the new rates will apply from Monday 4 July 2022," the FWO said.

"If you are covered by an award, award increases happen in two stages. Most awards will increase from the first full pay period on or after 1 July 2022.

"For some awards in the aviation, hospitality and tourism industries, the increase will happen from 1 October 2022."

In addition to an increase in minimum wages, employers and employees should also factor changes to superannuation (super) taking effect from 1 July, said the FWO. This includes the removal of the $450 super guarantee threshold and an increase in the super guarantee rate from 10% to 10.5%.

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