As we begin the new financial year, it is important to be aware of changes and new rates that apply from 1 July 2013. A snapshot of these changes is set out below.
- The national weekly minimum wage that applies to award/agreement free employees has increased to $622.20 per week (previously $606.40), or $16.37 per hour (previously $15.96).
- The casual loading for award/agreement free employees has increased to 24%. There is no change to the casual loadings in modern awards.
- All modern award minimum wage rates have increased by 2.6%. Modern award transitional provisions have moved into the fourth of five phases for the first full pay period on or after 1 July 2013.
- Wages in transitional instruments (including Division 2B State enterprise awards) have increased by 2.6% per week from the first full pay period on or after 1 July 2013.
- The superannuation guarantee contribution rate has increased to 9.25% (previously 9%) with further incremental annual increases to follow.
- Superannuation funds must now provide a new type of superannuation account called “MySuper”.
- The upper age limit for paying superannuation for eligible employees has been removed. Employers must make superannuation contributions on behalf of employees aged 70 years or older.
- The maximum superannuation contribution base has increased to $48,040 per quarter or $192,160 per annum (previously $45,750 per quarter or $183,000 per annum). An employer is not required to make superannuation contributions on behalf of employees on earnings in excess of that maximum contribution base.
For further details of these superannuation changes and the implications for your organisation, please see our previous article: Are you aware of, and prepared for, the increases to the superannuation guarantee contribution rate?
New high income threshold
- The high income threshold has increased to $129,300 per annum (previously $123,300 per annum). Employers must take care when determining whether an employee's earnings are above this threshold because some amounts paid to the employee should not be counted (for example, commissions, bonuses, overtime, reimbursements and compulsory superannuation contributions).
- This new threshold affects which award/agreement free employees have access to the unfair dismissal regime, and the maximum compensation available for unfair dismissal claims, which is now the lower of $64,650 (previously $61,650) or 26 weeks' pay.
- This threshold also affects which employees may be offered a "guarantee of annual earnings" that will result in no modern award applying to those employees for the period of the guarantee.
Taxation of employment termination payment (ETP) changes
- The tax-free component for bona fide redundancy ETPs has increased to a base limit of $9,246.00 (previously $8,806) and $4,624.00 (previously $4,404) for each completed year of service.
- The ETP cap has increased to $180,000 (previously $175,000). Amounts over this cap are not subject to concessional tax treatment and are taxed at the highest marginal tax rate.
- The filing fees for unfair dismissal and general protections applications have each increased to $65.50 (previously $64.20).