Get set for a minimum wage increase
Following its Annual Wage Review 2021-22, the Fair Work Commission (FWC) has made 2 announcements:
- The National Minimum Wage will increase by $40 per week, which amounts to an increase of 5.2%
- Award minimum wages will increase by 4.6%, which is subject to a minimum increase for award classifications of $40 per week and based on a 38-hour week for a full-time employee.
On this Page
- What you can do now
- National Minimum Wage increase
- Award Minimum Wage increase
- When the increase starts
- Changes to Superannuation from 01 July 2022
What you can do now
The FWC will now issue draft determinations and orders about how their decision affects awards. The FWC will then update the pay rates for each award.
The Fair Work Ombudsman are currently working to update to their pay tools, information and resources with the new rates. We expect to have these updated on 1 July 2022 for the first set of awards affected.
National Minimum Wage increase
The National Minimum Wage applies to employees not covered by an award or registered agreement.
From 1 July 2022, the National Minimum Wage will increase by $40 per week, which amounts to an increase of 5.2%.
The new National Minimum Wage will be $812.60 per week or $21.38 per hour.
Award minimum wage increase
Most employees are covered by an award. Awards are legal documents that outline the minimum pay rates and conditions of employment. If you’re not sure which award applies to you, use Find my award.
The FWC has announced that minimum award wages will increase by 4.6%, which is subject to a minimum increase for award classifications of $40 per week and based on a 38-hour week for a full-time employee.
This means minimum award wages:
- above $869.60 per week, will get a 4.6% increase
- below $869.60 per week, will get a $40 increase.
Read our examples below to understand how this wage increase will work in practice:
Example: Employee earning above $869.60
Hannah is a trade qualified employee working under the Manufacturing Award. She works at a higher level of C10.
Hannah’s weekly minimum wage before 1 July 2022 is $899.50.
As this weekly wage is above $869.60, her weekly wage will increase by 4.6% from 1 July 2022.
If you’re covered by a registered agreement, the minimum wage increase may apply. This is because the base pay rate in a registered agreement can’t be less than the base pay rate in the relevant award. Check your agreement by searching for it on the FWC website.
When the increase starts
National Minimum Wage
The new National Minimum Wage will apply from the first full pay period on or after 1 July 2022. This means if you have a weekly pay period that starts on Mondays, the new rates will apply from Monday 4 July 2022.
If you are covered by an award, award increases happen in 2 stages.
Most awards will increase from the first full pay period on or after 1 July 2022.
For some awards in the aviation, hospitality and tourism industries, the increase will happen from 1 October 2022. The affected awards are:
- Aircraft Cabin Crew Award
- Airline Operations – Ground Staff Award
- Air Pilots Award
- Airport Employees Award
- Airservices Australia Enterprise Award 2016
- Hospitality Industry (General) Award
- Registered and Licensed Clubs Award
- Restaurant Industry Award
- Marine Tourism and Charter Vessels Award
- Alpine Resorts Award
Changes to superannuation from 1 July 2022
In addition to an increase in minimum wages, there are changes to superannuation (super) you should know about taking effect from 1 July. This includes the:
- removal of the $450 super guarantee threshold – go to the Australian Taxation Office (ATO) website to learn more about this change: Removing the $450 per month threshold for super guarantee eligibility.
- increase in the super guarantee rate from 10% to 10.5% – visit the ATO website to learn more about this increase.
If you want to understand your super obligations or entitlements, contact CMA Accounting and Taxation Services.