Mass Confusion as Minimum Wage Deadline Arrives

Published July 01, 2022 (last updated August 22, 2022) Molly Chandran

As the 1 July deadline for the national minimum wage hike approaches, businesses around the country remain confused as to what their obligations are to their most vulnerable workers.

In addition to the three conditional minimum wage rates[1] announced by the Fair Work Commission on 15 June, employers in Western Australia were hit with a further three rates[2] differing from the national standard.

Employment relations experts, Employsure, who represent over 30,000 businesses across Australia have rostered over 30 extra advisors, researchers, and support staff to assist businesses navigate the complex changes that are due to take effect today.

“Our 24-hour advice line is experiencing high call volumes with employers around the country not sure what they should be paying after 1 July.” said Employsure CEO, David Price.

“In July 2021, when the last minimum wage rise went into effect, our phone lines experienced 1,300 more phone calls from concerned businesses unsure what the increase meant to them. We’re anticipating an even greater number of calls this year as businesses struggle with both the size and scope of the most recent wage change.”

Businesses across the country are experiencing a “perfect storm” of headwinds including record inflation, staff shortages, cost of living pressures, interest rate rises and depressed consumer confidence leading to increased speculation of recession. Additionally, SME’s with less than 5 employees make up over 90% of registered businesses in Australia are overrepresented in their exposure to minimum wage changes.

“Without a doubt, SME’s are the backbone of Australia’s economy. When they do well, so does the country. But they need help and certainty to get them through these difficult times.” Said Mr. Price.

“Our internal call data and experience demonstrates that one of the most common ways for employers to find themselves in trouble is unintentional underpayment of wages. And a lot of this comes from not understanding the nuance that separate the various national and state-based awards.”

“I think it’s important for all businesses to know that help is only a phone call away and could mean the difference between keeping the doors open or shutting up shop”

[1] 5.2% National minimum wage, 4.6% or +$40 (whichever is higher) award minimum wage

[2] 5.25% State minimum wage, +$40.90 for state awards below $887.40, 4.65% for state awards above $887.40

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