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Minimum wages to increase by at least $40 per week

wages

Minimum wages will increase by at least $40 a week, with the hourly pay rate rising from $20.33 to $21.38, the Fair Work Commission has ruled today.

In its annual wage review decision, the commission granted a 5.2 per cent increase to the national minimum wage and 4.6 per cent spike for award minimums.

The decision, which sets the pay of at least 2.7 million Australians on the national minimum or awards, comes into play from July 1.

In a note to its members today the Queensland Trucking Association (QTA) said the decision provides that all Modern Award classification scales shall increase by either $40 or 4.6 per cent rounded to the nearest ten cents on the following basis:

  • an increase of $40 if the current weekly award wage is below $869.60;
  • an increase of 4.6 per cent if the current weekly award wage is above $869.60.

The Federal Minimum Wage for award free employees shall be $812.60 per week or $21.38 per hour.

The hourly rate has been calculated on a 38-hour week for a full-time employee. This constitutes an increase of $40 per week to the weekly rate or 1.05 cents per hour to the hourly rate.

The increases apply from the first pay period on or after July 1 for the majority of modern awards, including the following:

  • Road Transport and Distribution Award 2020
  • Road Transport (Long Distance Operations) Award 2020
  • Clerks – Private Sector Award 2020
  • Manufacturing & Associated Industries and Occupations Award 2020

The QTA said that members who have Workplace Agreements in place will need to ensure that their agreement rates meet, or exceed, the new minimum award rates and, if the agreement pay increases are linked to the panel’s decision, the pay rates will need to be adjusted within the Workplace Agreement accordingly.

“The increases can be absorbed into any amounts now being paid over and above the relevant minimum rates,” the QTA advised.

“However, be aware the Fair Work Ombudsman makes it clear that over award pay-rates can NOT off-set other award entitlements (e.g. penalties or loadings) unless there is a formal agreement in place. Rates for juniors, trainees and apprentices will also be adjusted, as usual, on a proportionate basis.”

The QTA also reminded members that it can provide assistance to any operator who seeks to formalise the employment conditions in their workplace in an Agreement certified by the Fair Work Commission through the services of its employment relations manager Ezra Pyers.

Meanwhile, the National Road Transport Association (NatRoad) believes that the wage increase will mean that some operators will struggle to meet these new labour costs.

NatRoad CEO Warren Clark said the profit margin of member road transport companies was about 2.5 per cent.

“Operators are struggling under sky-high fuel prices and other pressures and this will hit many of them hard,” Clark said.

“This underlines the importance of the new federal government moving quickly to reform the industry, particularly unfair contract terms.

“It’s imperative that members aren’t locked into loss making contracts, particularly in the face of a substantial Award minimum wage increases order.”

For a full copy of the FWC decision, click here.

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