The end of the financial year is a time of change, and no less than when it comes to the Fair Work Act and related legislation.
In this Bulletin, we draw your attention to changes taking effect from 1 July 2014:
- The “high income threshold”, which is relevant for access to unfair dismissal jurisdiction for non-award covered employees, increases from $129,300 to $133,000 a year. As before, the amount excludes superannuation and payments which cannot be determined in advance, such as some bonuses or commission.
- The compensation cap on compensation for unfair dismissal increases to $65,650.
- However, the filing fee for unfair dismissal and general protections applications made under the Fair Work Act (sections 365, 372, 394 and 773) remains at $65.50.
- The minimum superannuation guarantee rate increases from 9.25% to 9.5%. How do you describe your employees’ remuneration, inclusive or exclusive of superannuation?
- The maximum contributions base for superannuation has risen from $48,040 to $49,430 per quarter (or $197,720 a year).
- The tax-free component for bona fide redundancy payments rises from $9,246 to $9,514 for the first year of service, and from $4,624 to $4,758 for each subsequent completed year of service.
- The national minimum wage for non-award employees, or those who are not covered by an enterprise agreement, rises on 1 July 2014 from $622.20 to $640.90 a week (based on 38 ordinary hours worked), or from $16.37 to $16.87 an hour, payable in the first full pay period after 1 July 2014.
- The casual loading increases from 24% to 25%, meaning that the Fair Work Act staged phase-in will be complete.
- Modern Award minimum wage rates are increasing by 3%. All Modern Awards will be updated on 1 July 2014 to contain the new rates, so make sure you are looking at the current version if you are referring to a Modern Award.
- So if you are paying a remuneration package over the minimum rate of pay and designed to include all award entitlements, then you may need to check the total against the new minimums.
Potential changes arising from the 2014-15 Budget:
- Businesses could receive up to $10,000 if they hire a job seeker aged 50 or older. From 1 July 2014, eligible employers will receive $3,000 if they hire a full-time mature age job seeker who was previously unemployed for a minimum of six months and, they employ that person for at least six months. Once the job seeker has been working for the same employer for 12 months, the business receives another $3,000, then another $2,000 at 18 months and a final $2,000 at two years.
To be eligible, the business needs to demonstrate the job they are offering is sustainable and ongoing, and they are not displacing existing workers.
- Subject to the passage of legislation, the new paid parental leave scheme will commence on 1 July 2015. The current government position is that eligible working parents of children born or adopted on or after 1 July 2015 with income up to $100,000, including superannuation, will have access to 26 weeks of paid parental leave at a rate based on their wage but capped at $50,000 (reduced from $75,000). The policy also provides for superannuation contributions.
Those earning over $100,000 are still eligible for paid parental leave, but the maximum rate at which it is being paid is capped at $100,000 a year.
Happy New Financial Year to all.