The decision is now final: the Fair Work Commission (FWC) has just announced an official boost to the national minimum wage for 2024.

This will affect every employer in Australia who pays their staff the minimum wage.

In fact, according to Fair Work,

“Approximately 20.7 per cent of the Australian workforce, or about 2.6 million employees, are paid in accordance with minimum wage rates in modern awards. They, and their employers, are directly affected by this decision.”

Let’s jump into some details.

What’s the new national minimum wage?

The 2024 review will see minimum wage earners take home an extra 3.75%. What does this mean?

  • the current weekly minimum wage will increase from $882.80 to $915.90 (an increase of $33.10).
  • the current hourly minimum wage will increase from $23.23 to $24.10 (an increase of $0.87 per hour).
  • a 3.75 per cent increase will also apply to modern award minimum wages across the board.

Why is there an increase?

The national minimum wage must be constantly reviewed to ensure a fair go for Australian minimum earners. As the cost-of-living increases, so too must wages. This of course ensures earning Australians can continue to fill their cars, stock their fridges, and pay their rent or mortgage.

It’s also intended to mitigate expected inflation through 2025.

As the FWC stated,

“In determining this level of increase, a primary consideration has been the cost-of-living pressures that modern-award-reliant employees, particularly those who are low paid and live in low-income households, continue to experience notwithstanding that inflation is considerably lower than it was at the time of last year’s review,” the commission said.

When does it kick in?

The new wage will be in effect from the first full pay period from 1 July 2024, just as the new financial year kicks in. From that date, you must absolutely adhere to the new wages and be on top of your necessary payroll changes or new hire contracts.

What do you need to do now as a business owner?

Right, it’s time to get your payroll admin on.

If you employ any staff on minimum wage, be sure you’re compliant in a timely manner. With STP now in full swing, you must be reporting employee pay correctly through approved accounting or payroll software.

As such, make sure your software is updated by 1 July 2024, as well as pay slips and other pay related documentation.

Does it affect all employees on minimum wage?

Yes indeed. If you have staff on hand who earn minimum eage, you need to get moving on updating your payroll. As always, all employees will need to be paid, at the very least, the updated national minimum wage.

If you don’t, you’ll be in the crosshairs of some relatively serious ramifications, so don’t sleep on this.

What about industry awards?

The new minimum wage may not necessarily impact all staff, but it will affect minimum wages across awards as well.

As per normal, if your employees operate under an industry award, this will always trump any national minimum wage implicatuions. Industry awards will always come before other rules and wages.

At the time of the announcement, commensurate changes to industry award wages are also included with a rise of 3.75% – so make sure you pay attention to these as well.