On 19 June, the Fair Work Commission announced it would increase the national minimum wage and the modern award minimum wages by 1.75 per cent.

The COVID-19 pandemic had a very large influence on the decision and while employer groups were not able to successfully argue that the minimum wage should not be increased at all, the increase awarded is considered to be modest when compared with previous years.

Employee Classification Minimum Weekly Rate
(full-time employee)
Minimum Hourly Rate
(full-time employee)
Level 1 $753.80 $19.85
Level 2 $775.45 $20.40
Level 3 $797.70 $21.00
Level 4 $827.90 $21.80
Level 5 $877.60 $23.10

The Commission has taken into account the effect that COVID-19 had on the horticulture industry by delaying the effective operation date from July to November. Therefore, the Award minimum wages listed above will take effect from the beginning of the first pay period on or after 1 November 2020.

As per previous years, if you are paying your employees in excess of the Award minimum increase, the minimum wage increase is absorbed into the excess.

In addition, if you have offset any award entitlements into an above award payment (eg annual leave loading or leading hand allowances etc), you will need to conduct a reconciliation of each employee’s salary to ensure that they are receiving at least the equivalent of the new minimum wage plus the value of the entitlements.

Courtesy of the AUSVEG Communications team. Funded under Hort Innovation’s National Vegetable Industry Communications Program VG18000