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The Fair Work Commission has ruled that both the minimum wage rate and industry Award wage rates, including those in print, will rise by 3.75 per cent from 1 July.

Wage rise to increase business costs: Charles Watson

The rate is a compromise between what the unions and employers’ groups wanted, with the Commission citing weak productivity as the reason the increase was not at the level workers wanted.

The new National Minimum Wage for full-time employees will be $915.90 per week (based on 38 hour working week) or $24.10 per hour. Effectively, this is a $33.10 per week, or 0.87c per hour, increase against the current minimums.

From an Awards perspective, the Commission has determined to increase modern Award wage rates also by 3.75 per cent. As usual, the incoming increases to Award minimum rates of pay can be absorbed into an Award covered employee’s current rate of pay, as long as the result leaves their rate of pay at least equal to the increased Award minimum rates.

Charles Watson, general manager of policy, IT and governance at the print industry employers’ group Visual Media Association (VMA), said, “Given most in the industry pay above Award minimum rates, the impact of the decision on member wage bills would be minimal. However for those that are close to the minimum rates, and have to make upward pay rate adjustments, it will further slim down margins and add to current increased business costs.”

VMA will provide a more in depth review of the decision. This will include the effect of the decision on Awards, Enterprise Agreements, Apprentices, Award-free and salaried employees. The Commission will finalise determinations for Award minimum wage rates and Allowances over the next weeks. Once finalised, VMA will provide members with updated relevant industry Award minimum rate guides.

Watson said, ‘The 3.75 per cent increase to the National Minimum Wage, and that will flow on to Award rates of pay from the effective date, falls between the five per cent that had been sought by the ACTU and the 2-3 per cent sought by most employer groups. Leading up to the decision, the VMA held the view that any increase should be modest, taking into account the potential effects of a significant increase in wages on inflation, and the current lower productivity levels across the Australian economy.

“The VMA also requested the Commission take into account the Stage 3 tax cuts and the upcoming increase to the superannuation guarantee rate when determining the minimum wage increase,” said Watson.

He also said, “In reviewing the decision, the Commission concluded that economic factors, particularly the sharp rise in the cost of living, weighed in favour of an increase to both the national minimum wage and the modern award minimum wages. However, the Commission did accept the need for a level of moderation in the increase so as to constrain possible inflationary pressure arising from its decision. Further, the Commission determined that various Federal budget measures detailed in May, along with Stage 3 tax cuts, were also moderating factors. Nonetheless, the decision is above current CPI figures.”

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