From 1 July, 2015 there are changes to minimum wages, award wages and national unfair dismissal thresholds.

We now summarise some changes about which employers need to be aware.

Increases to minimum wage rates for employers - for all states and territories except for Western Australia.

From the first full pay period on, or after, 1 July 2015, the following minimum wages increases apply:

  • Modern award rates of pay increase by 2.5 percent;
  • The national minimum wage increase from:
  • for adults working full time (38 hours per week) - $640.90 to $656.90 - an increase of $16.00 per week;
  • The hourly rate increase is increase from $16.87 to $17.29 per hour - an increase of 42 cents per hour; This was a lower increase than last year’s increase.

Employers are recommended to conduct an annual review of their remuneration arrangements with their employees.

Changes to the high income threshold and federal unfair dismissal jurisdiction

The high income threshold for the purposes of an unfair dismissal claim under the Fair Work Act increased from 1 July, 2015 to $136,700 per annum.

Section 332 of the Fair Work Act defines an employee’s earnings to include:

  • the employee’s wages; and
  • amounts applied or dealt with in any way on the employee’s behalf or as the employee directs; and
  • the agreed money value of non-monetary benefits.

However, an employee’s earnings do NOT include:

  • payments the amount of which cannot be determined in advance
  • reimbursements
  • employer contributions to a superannuation fund.

Superannuation

The superannuation guarantee charge percentage will remain at 9.5 percent.

Employment termination payments (ETP)

The ETP cap for life benefit and death benefit termination payments increases from 1 July to $195,000.

The amount up to the ETP cap is taxed at a concessional rate and the amount in excess of the ETP cap is taxed at the highest marginal rate.

Genuine redundancy programs

The tax free limit of genuine redundancy is increased to $9,780, plus $4,891 for each completed year of service.