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The Fair Work Commission (‘FWC’) today delivered the Annual Wage Review decision. The increase of 3.5% was greater than in previous years (3.3% and 2.4% respectively), although it was still less than what the unions wanted.

The ACTU had argued for an increase in the national minimum wage of $50 a week or 7.2%, an increase of more than double the 3.3% delivered last year. Some employment organisations argued against any increase or for a minimal increase of 1.1% or $7.64. The majority submitted an increase of 1.9% or $13.20.

In the end, the FWC took the middle ground, taking into consideration the state of the economy and the gender pay gap.

The new minimum annual wage will be $719.20 per week or $18.93 per hour, an increase of $24.30 per week or 64 cents per hour. This applies from the first full pay period on or after 1 July.

Casual loading remains at 25%, other than for those employed under the Business Equipment Award 2010, where the loading has increased to 23%.

All Award rates will also increase by 3.5%, as will junior award rates and those of disabled workers.

The FWC and Fair Work Ombudsman will update the wage tables found in Awards and on their websites over the next few weeks in preparation for 1 July.

Phasing down of Sunday rates

Employers need to remember that from 1 July the start of the second year of the phasing down of the Sunday penalty rates begins. This applies to the retail and pharmacy sectors (phasing to take four years) and in hospitality and fast food (phasing to take three years).

The reductions in penalty rates are as follows:

Current rateNew rate
General Retail Award
Full time and part time95%80%
Pharmacy Award
Full time and part time (7 am - 9 pm)95%80%
Casuals* (7am - 9 pm)120%105%
Hospitality Industry
Full time and part time170%160%
Fast Food Industry
Full time and part time45%35%

*includes casual loading.

Should you have any questions regarding the Annual Wage Review or any Award payments, please contact a member of our employment law team.