–
All Modern Award rates of pay are increased by 2.9% effective from the
first full pay period commencing on or after (ffppooa) 1 July 2012.
– This increase can be absorbed into any existing over award payments (check the absorption clause in your Modern Awards).
–
If you are transitioning rates of pay to the Modern Award, an
employee’s new minimum rate is his/her new Modern Award rate plus or
minus 40% of the transitional amount.
–
Award free casual employees – the default casual loading has increased
from 22% to 23% effective from the first full pay period commencing on
or after 1 July 2012.
Summary of Decision
The
2.9% increase raises the adult National Minimum Wage to $606.40 per
week (an increase of $17.10 per week) and to $15.96 per hour (an
increase of $0.45 per hour). The National Minimum Wages for employees
under training arrangements, juniors and employees with a disability
have also been increased by 2.9%.
The
minimum weekly payment for employees on the Supported Wage System
(currently $75) has not been increased by this decision but can be
expected to be increased before the 1 July operative date. Any increase
will be advised to members. Adult award rates were also increased by 2.9% at all classification levels, with weekly wages rounded to the nearest $0.10. This
decision applies to all employers whose operations or employees are
covered by Modern Awards, Enterprise Awards and NAPSAs, all transitional
APCSs, and award free employees.
Key Features of the Decision
1. Modern Awards
All
Modern Award adult rates of pay are increased by 2.9% effective from
the first full pay period commencing on or after 1 July 2012.
For
many employees, the annual wage review increases coincide with the
third transitional step into the Modern Award which also applies from
ffppooa 1 July. Subject
to the operation of the transitional arrangements, Modern Award
classification rates are the minimum award classification rate that can
be paid under an award or agreement. In some cases this may require
increases ffppooa 1 July to bring an employee’s rate up to the new
Modern Award or transitional rate.
Minimum wages for juniors, employees under training arrangements, employees with a disability, piece rates and the National Training Wage
Most
junior and apprentice rates are expressed as a percentage of an
identified adult classification rate and the annual wage review increase
is passed on to juniors in this way. The 2.9% increase applies to all
levels of the National Training Wage Schedule which is in most Modern
Awards.
Where
juniors, apprentices or trainees not under a National Training Wage are
phasing into the Modern Award the rules to increase their rates in the
pay scale or transitional award should be followed.
Piece rates increase in accordance with the relevant provisions in the Modern Award and pay scale or transitional award.
2. Award-free employees
Award-free
adult employees are covered by the National Minimum Wage. This was
increased by $17.10 to $606.40 (or $15.96 ph) ffppooa 1 July.
Award-free
casuals are covered by the default casual loading unless there is an
agreement covering them. The default casual loading will be increased
from 22% to 23% ffppooa 1 July.
Special national minimum wages for award/agreement free junior employees
The
2011 Annual Wage Review adopted the junior wage percentage scale in the
Miscellaneous Award 2010, applied to the national minimum wage, as the
special national minimum wage for award/agreement free junior employees.
This scale will continue to apply to these employees.
Special national minimum wages for award/agreement free employees to whom training arrangements apply
The
2011 Annual Wage Review adopted the provisions of the Miscellaneous
Award 2010 as the basis for award/agreement free employees to whom
training arrangements apply. The apprentice provisions in that award and
the provisions of the National Training Wage Schedule were incorporated
into the National Minimum Wage order. Adult apprentices should not
receive less that the National Minimum Wage for adults.
The wage decision and transitional provisions
Many
Modern Awards have transitional provisions phasing-in the award’s
classification rates and penalties or loadings. The next phase-in step
for penalties and loadings also applies from ffppooa 1 July 2012.
The
difference between the pay rate for the employee’s classification in
the old pay scale or transitional award and the appropriate
classification in the Modern Award is called the “transitional amount”.
Similarly, the differences between penalties and loadings (including the
casual loading) in the old pay scale, NAPSA or transitional award and
the corresponding penalty or loading in the Modern Award are called the
“transitional percentage”.
From
fppooa 1 July 2012 the third stage of phasing starts in Modern Awards
with standard transitional provisions (most Modern Awards).
This
means employers must pay the modern award rate (including the 2.9%
increase) +/- 40% of the transitional amount (depending on whether your
pre-modern award was higher or lower than the modern award rate).
Employers must also pay the relevant penalties and loadings +/- the 40%
of the relevant transitional percentage.
The
decision does not change the size of the transitional amount, just the
modern award rate that the transitional amount affects. Nor does the
decision alter the percentages of the modern award penalties or
loadings. The move from +/- 60% to +/- 40% of the transitional
percentages at the same time as the annual wage review increases follows
from the Modern Award transitional provisions.
Further Information
New
pay schedules for each modern award reflecting the increases advised
above will be forwarded in due course to members receiving the Chamber’s
industrial awards service. This year, for the first time, the pay
schedules will be sent via email rather than post unless you have
elected not to receive email correspondence.
If
you have further questions regarding how this decision affects
transitional arrangements under a Modern Award please contact the
Workplace Advice Unit.
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