Minimum wage and payroll costs increase

Increased wages and salary oncosts confirmed for 2024/25

From the first pay period on or after 1 July 2024 there are a number of increases that businesses should be prepared for and that workers should review to ensure their wages are being processed in line with the new obligations.

Minimum wage to increase by 3.75%

On June 3 the Fair Work Commission announced a 3.75% increase to Award and National Minimum wages. This means that after 1 July, every employee covered by a Modern Award that is paid at the minimum salary band or casual rate for their role classification will receive an increase to their gross (before tax) wages of 3.75%.

This takes the National Minimum wage to $915.90 per week or $24.10 per hour ($30.128 per hour including casual loading)

Superannuation scheduled increase to 11.5%

As part of the Australian Governments plan to lift the legislated superannuation guarantee, from 1 July employees are entitled to a payment of 11.5% of their ordinary earnings to be paid into their nominated superannuation fund. This increase is part of a phased approach that will see the superannuation guarantee in Australia rise to 12% in July 2025.  At this stage there are no planned further increases to superannuation beyond 2025.

Victorian Workers Compensation premiums confirmed for 2024/25

The Victoria Government Gazette periodical released on 4 June 2024 contained the updated Premiums Order (No.32) which sets out workers compensation premiums for each WorkCover Industry Code (WIC). These rates are reviewed annually and changes to the rate are applied based on a risk assessment of claims made in the previous financial years.

What does this mean for employers?

By the first pay period on or after 1 July 2024, businesses will need to review salaries to ensure anyone entitled to a wage increase receives one, and all employee superannuation payments will need to be increased from 11% to 11.5%. Employers should also expect a change to their WIC rate, most likely an increase, resulting in higher insurance costs for the year ahead.

For employers with on-hired casual employees, increased hourly rates resulting from superannuation and WIC rates should be expected, as well as a larger increase for any casual workers currently on the minimum wages under their award or the National Standards.

The team at Dixon Appointments will be communicating expected changes to on-hired costs over the next couple of weeks, however, any employer that requires an accurate prediction of costs from 1 July 2024 can reach out to their Recruiter anytime, and a quote can be provided for their specific on-hired casuals.

What does this mean for employees?

Employees should check their pay from the first complete pay period that starts on or after 1 July 2024 to ensure that any increase to their gross pay has been applied and the amount of superannuation remitted has increased to 11.5%.

Any employee not on a minimum wage may not receive an increase to their wage or pay rate, but all employees are entitled to the increase in superannuation.

You can check your award wage entitlements using the Find my award tool on the Fair Work Ombudsman website or look up your Award here.