From 1 July 2019, all minimum pay rates in all modern awards as well the national minimum wage will increase by 3.0%.

The Fair Work Commission has announced that the national minimum wage will increase by 3.0% to $740.80 per week, or $19.49 per hour. The weekly rate is based on a 38-hour week for a full-time employee. This totals to an increase of $21.60 per week, or $0.56 cents per hour.

The Commission made the following comments in relation to the decision to award a lower increase than in the past 2017/2018 minimum wage review:

[10] We have decided to award a lower increase this year than that awarded last year having regard to the changes in the economic environment (in particular the recent fall in GDP growth and the drop in inflation) and the tax-transfer changes which have taken effect in the current Review period and which have provided a benefit to low-paid households.

[11] We are satisfied that the level of increase we have decided upon will not lead to any adverse inflationary outcome and nor will it have any measurable negative impact on employment. However, such an increase will mean an improvement in real wages for those employees who are reliant on the NMW and modern award minimum wages and an improvement in their living standards.

Who does the increase apply to:

The 3.0% increase applies to employees that get their pay rates from:
• The national minimum wage - Applies to employees who aren’t covered by an award or agreement.
• A modern award – For employees covered by an award, award rates will increase by 3.0%. If you are not sure which award applies, use Find My Award.

If you are covered by a registered agreement, you should check it to see whether this increase effects for you.

The increase will also apply to:
• junior employees
• employees to whom training arrangements apply
• employees with a disability

The increase does not affect employees who already get paid more than the new minimum wage.

Some penalty rates are changing too:

There will be further changes to certain penalty rates in some hospitality and retail awards from 1 July 2019, following a Commission decision in 2017.

For more information about what the changes are, who they affect and how they’re being implemented, visit the Penalty rates changes.

What happens next?

The Commission will issue draft determination and orders about how this decision affects modern awards. Pay rates in each award will be then updated.

With all these changes, PJT Accountants & Business Advisors can help you if you have any enquiry about the wage increase and its application to remuneration arrangements, including through Modern Awards and Enterprise Agreements. Email us at enquiry@pjtaccountants.com.au or call us at 5143 9300 and will be glad to help you.