Employers should take note of changes to the employment landscape that take effect on 1 July 2019.
Increase in the National Minimum Wage and modern award rates
As discussed in a separate Williams + Hughes Insight, from 1 July 2019 the:
- national minimum wage will increase to $740.80 per week or $19.49 per hour (an increase of $21.60 per week or $0.56 per hour); and
- minimum full time wage rates set out in modern awards will increase by 3%. Allowances will increase in accordance with the provisions of the relevant modern award.
Changes to the Maximum Superannuation Contributions Base
The Maximum Superannuation Contributions Base is set by the Federal Government each year. It is used to determine the maximum limit on any individual employee’s earnings base for each quarter for superannuation guarantee payment purposes. An employer does not have to pay the superannuation guarantee for the portion of earnings above this limit.
From 1 July 2019 the Maximum Superannuation Contributions Base increases to $55,270 per quarter, up from $54,030. So, the maximum superannuation guarantee payments that an employer is liable to pay from 1 July 2019 per employee is 9.5% of $55,270, or $5,250.65 per quarter. Calculations should always be made on a quarterly, not annual, basis.
Changes to the High Income Threshold
From 1 July 2019 the high income threshold will increase to $148,700 per annum (from $145,400 per annum). This is important because the high income threshold sets the limit on an employee’s ablity to bring unfair dismissal proceedings. If an employee’s annual rate of earnings is more than the high income threshold, the employee is not able to bring an unfair dismissal claim unless they are covered by a modern award or enterprise agreement.
The increase to the high income threshold also means that the maximum payable compensation for unfair dismissal increases to $74,350, which is 50% of the new high income threshold.
The increase to the high income threshold also sets the minimum guaranteed earnings hurdle for an employee to be a “high income employee” for the purposes of modern award coverage. If a high income guarantee is entered into, the employee is not subject to the application of any modern award.
When calculating earnings for the purpose of the high income threshold, the following items are included:
- wages and salary
- any amounts applied or dealt with on the employee’s behalf (for example salary, sacrifice amounts)
- the agreed monetary value of any non-cash benefit (for example, use of a company car, laptop or mobile phone).
The following are not included as part of an employee’s earnings:
- payments that cannot be determined in advance (for example bonuses, commissions, incentive‑based payments and overtime, unless the overtime is guaranteed)
- reimbursements for business expenses
- superannuation guarantee contributions.
New whistleblower laws
Under the new whistleblower regime, public companies, proprietary companies that are trustees of a superannuation entity and large proprietary companies must have a compliant whistleblower policy and must provide it to their employees.
As discussed in a separate Williams + Hughes Insight, from 1 July 2019 new asset, revenue and number of employees thresholds apply when determing whether a company is a large proprietary company.
The new whistleblower regime takes effect from 1 July 2019. Although the new regime applies to disclosures made on or after 1 July 2019, the disclosures may relate to conduct that occurred before that date.
The requirement to have a whistleblower policy in place commences on 1 January 2020, although a small proprietary company that becomes a large proprietary company after 1 January 2020 will have an additional six months to establish a whistleblower policy.
Given that companies need to comply with the new laws from 1 July 2019 and must have compliant policies in place by the dates referred to above, companies must take steps to prepare compliant whistleblower policies. Managers and staff must also be trained to properly handle disclosures that are protected under the new whistleblower laws - the new laws require this. The whistleblower policies must also be made available to officers and employees of the company.