INCREASE TO THE NATIONAL MINIMUM WAGE

Workplace Directions

The Fair Work Commission (FWC) has handed down the 2019 Annual Wage Review decision, granting a 3% increase to the national minimum wage and minimum wages in modern awards. The weekly national minimum wage will increase by $21.58 to $740.78 and the hourly minimum wage will increase by $0.56 to $19.49. The increase will apply from 1 July 2019. Around 2.2 million employees or 21% of all employees have their wages set by the national minimum wage, or by a modern award minimum wage, and will be directly affected by this decision.

In making the decision, the FWC noted that despite the recent fall in GDP growth and drop in inflation, the Australian economy has performed moderately well. The labour market has performed strongly, with the proportion of the working age population that is in employment being at record levels. Such economic circumstances provided the FWC with the ‘opportunity to improve the relative living standards of the low paid, and to enable them to better meet their needs’ by awarding the 3% increase.

The decision followed submissions from the Australian Council of Trade Unions (ACTU) for an increase of $43 a week – or 6% – as part of its campaign for a ‘living wage’. While the ACTU submitted that the growth in the Australian economy was ‘healthy’, the Australian Industry Group contended that the economy had ‘moved back into the slow lane’ and sought a modest wage increase of 2%. Similarly, the Australian Chamber of Commerce and Industry recommended a maximum increase of 1.8%, given that economic performance and forecasts are materially different to those
12 months ago and point to a weaker economy.

The FWC awarded a 3.5% increase last year, the biggest rise since 2010, which lifted the national minimum wage by $24.30 per week.

The FWC’s Summary of Decision can be read here, while the Full Decision is available here.

Further information / assistance regarding the issues raised in this article is available from the author, Alison Freeman, Lawyer your usual contact at Moray & Agnew.

 


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