12 June 2013
Annual adjustment of award rates and federal minimum wage
On Monday 3 June 2013 the Fair Work Commission announced its annual wage review decision adjusting award rates and the federal minimum wage by 2.6% effective from the first pay period on or after 1 July 2013. This brings the national minimum wage for adults to $622.20 per week or $16.37 per hour. Employers who employ employees who are subject to training arrangements are not required to adopt the national minimum wage, although that rate is the basis for some adult apprentice rates in awards. This means that an adult apprentice or trainee only has to be paid at or above the adult national minimum wage if stipulated in the relevant award covering their employment.
The decision included reference to the National Training Wage rates being increased by 2.6% as are rates in transitional NAPSAs that continue to operate in relation to apprentices and trainees in Queensland.
Where transitional rates are in place, the rate of adjustment from 1 July 2013 will be the modern award rate as at 1 July 2013 +/- 20% of the transitional rate as calculated in 2010.
Draft determinations varying awards will be published by FWC for comment before being finalised.
Some of the economic considerations taken into account by FWC when making the decision included that gross domestic product grew by 3.1% over the year to the December quarter 2012 and Consumer Price Index around 2.5% over the year to March quarter 2013.
Interestingly they also referred to the tax-transfer systems playing a significant role in alleviating the impact of earning inequality and supporting the living standards of low paid workers, and the evidence suggests that the tax-transfer system has been effective in increasing the level of real disposable income for lower paid award reliant families. They have asked the parties to consider the tax–transfer system in making submissions to the 2013-14 annual wage review. They also encouraged the Australian Government to discuss this with the major parties in an effort to arrive at a consensus as to the specific effect any future tax-transfer changes may have on the minimum wages in the 2013-14 review.