HR Unplugged

NEWS

FAIR WORK COMMISSION NATIONAL WAGE REVIEW SUMMARY

 
 
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THE FAIR WORK COMMISSION HAS INTRODUCED THEIR ANNUAL WAGE REVIEW ON 1ST JUNE, TO TAKE EFFECT FROM THE 1ST JULY 2018

 

Review of wage rates take into account fair minimum wage, social inclusion, standard of living and any other topic that the Commission deems relevant. 
Equity pay across genders is important to the Commission as it demonstrates what is fair.

 
 

THIS

  • Impacts all those employees on an Award;
  • Impacts National Miniumum Wage; and 
  • Is also relevant for all those employers that are negotiating Enterprise Agreements to ensure they meet the Better Off Overall test, which is crucial for any Agreements to be approved by the Fair Work Commission.

OUTCOME

  • National Minimum Wage increased by 3.5% ($0.64 cents per hour or $24.30 per week) to $18.93 per hour or $719.20 per week.  Round it to the nearest 10 cents.
  • The percentage increase above applies to all Award-employees
  • Two disability rates have been introduced (Supported Wage System Scheme)
  • Junior rates for Award-free employees have been introduced
  • Apprecentice rates for Award-free employees have been introduced
  • Award-free casual employees received 25% loading provision

KEY POINTS TO NOTE

  • 22.7% of Australian employees are covered by the pay rate set out in the Award (i.e., not outside of an Award and not covered by an Enterprise Agreement);
  • 1.9% of adults are paid at the National Minimum Wage.  This wage has increased 4.3% in the last five years
  • Nationally, the Consumer Price Index (CPI) is 0.2% less than what it was this time last year, while the Wage Price Index (WPI) is 0.2% more, yet wage growth has been quite stagnant across recent years.
  • GDP is the same at the Wage Review this time last year’s, but the forecast is due to grow from 2.4% to 3%.  The unemployment rate is 0.3% less, and the participation rate has also gone up 0.9% (a record high).  These statistics are important to the Commission when looking at a Wage Review = a determination that the economy is robust and the labour market is at its peak.
  • While the Wage Price Index (WPI) is forecasted to grow by the federal government 2.25% this year, 2.75% next year and up to 3.25% in 2019-2020, the Commission sees this as overly positive.
 
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The Commission balanced the aim to lift Award-based and National Minimum Wage employees out of the defined poverty line, with the need to ensure there are no adverse employment effects. Updates to all Awards will now occur over the next month.  Make sure you check the Fair Work Commission website for the full wage updates across all categories of employees, including casual employees.

For assistance with this, contact HR Unplugged.

 

All wage updates must be applied from the first full pay period after 1st July 2018.

DATA SOURCE | Fair Work Commission National Wage Review Summary 2017 - 2018
To read the full summary decision by the Fair Work Commission, click here:
https://www.fwc.gov.au/documents/sites/wagereview2018/decisions/2018fwcfb3500-summary.pdf

 
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