The Fair Work Commission has handed down one of its biggest minimum wage increases in years, increasing the take-home pay of Australia’s Award Rate earners by 5.75%, and pushing up the minimum wage by 8.65%.
The decision comes on the back of continuous, decades-high inflation across the Australian economy, and will have flow-on effects in every industry. It’s the second major wage increase in two years, following on from last year’s 5.2% raise.
Unions had called for an increase in line with inflation of 6.8%, while business had advocated for a smaller 3.5% increase, warning any more could put jobs at risk. In the end, Fair Work settled on a figure in between the two submissions – 5.75%. It means that the spending power of workers will decline slightly when adjusted for inflation.
The new rates apply from July 1, and every business needs to take steps to make sure they pay the new rate accurately. The Fair Work Ombudsman has been targeting businesses that underpay staff with increasing spot audits and other compliance activity in recent years. It’s important to have a plan to transition to the new rates in place.
If you use Tanda, the rates will automatically roll over on July 1 under our managed award system. Our compliance team researches and implements these rates across the board. Other systems may vary, and you should consult with your vendor on their processes. If you don’t have digital Workforce Management Software, we’d recommend considering it for managing your staff’s pay – one of the easiest ways to make mistakes is to try and pay staff with manual calculations.
Managing Growing Costs
Inflation has been a bugbear for businesses nationwide and is increasingly affecting costs and operations. Rent, electricity, labour, are all going up. Based on Tanda’s conversations with many businesses that have hourly shift employees, changing cost pressures are a real concern for their business.
Recently, Tanda hosted a webinar with our Head of Partnerships, Nick Braban, discussing the best ways to manage increasing costs. Nick has 20 years of experience in the hospitality sector, and offered some key tips. You can watch the full webinar here. If you don’t have time to watch the webinar, we’ve included a key summary below:
- Roster to match demand
Find the balance between over and under staffing. Keep costs under control, but don’t miss opportunities either.
- Retain and train staff
Invest in your staff skillsets and don’t run them down with long shifts at bad times. Develop skilled staff, reduce turnover, and reduce the costs of training new staff.
- Optimise penalty rates and overtime
Consider whether penalty rates are worth it for your business. Design your roster to minimise overtime.
- Stay compliant with outer limits & other compliance rules
New rules put strict limits on how many overtime and penalty rate hours salaried staff can work. Stay compliant.
- Use Data and technology
Modern Workforce Software gives you unprecedented insights into your labour force. Use it to optimise operations.