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Fair Work Commission hands down minimum wage increase

The Fair Work Commission has announced its decision following the Annual Wage Review for 2023–2024. This review, conducted under section 285 of the Fair Work Act 2009, encompasses two primary tasks: reviewing and setting the national minimum wage and reviewing modern award minimum wages.

Key outcomes

  1. National minimum wage:
    The national minimum wage, which applies to employees not covered by modern awards or enterprise agreements, will be increased by 3.75% from 01 July 2024. This adjustment primarily affects a small segment of the workforce.
  2. Modern award minimum wages:
    The review of modern award minimum wages is crucial as it affects approximately 20.7% of the Australian workforce, equating to about 2.6 million employees. Modern awards set minimum wage rates across 121 different awards for various industries and occupations. The new rates also reflect the 3.75% increase.

    The decision impacts a broad spectrum of employees, many of whom are part-time, predominantly women, and casual workers who are more likely to be low-paid.

Impact on private practices

Health Professionals and Support Services Award 2020 & Nurses Award 2020:

  • These awards are vital for private medical practices as they cover most managers, administrative staff and all nurses, who form the backbone of these practices.
  • The 3.75% wage increase will directly affect employees covered under these awards, ensuring that their pay keeps pace with the broader economic conditions and cost-of-living pressures.
  • This increase aims to alleviate financial stress for many low-paid workers in private medical practices, including part-time and casual employees.
  • Practices need to ensure base compliance leading up to 01 July 2024 to avoid any risk of underpayments.

Broader economic considerations

  • The review considers relative living standards, the needs of low-paid workers, workforce participation, national economic performance, and gender equality.
  • Cost-of-living pressures and ongoing financial stress for low-income households were significant factors in deciding the wage increase. Despite a lower inflation rate compared to the previous year, real wage rates for award-reliant employees remain lower than five years ago.
  • The increase aligns with forecasted wage growth across the economy and is consistent with the anticipated return of inflation to below 3% by 2025.
  • Labour productivity and business profit growth were also taken into account, with specific attention to industry sectors heavily reliant on modern award wages.

Gender equality

  • A program has been established to address gender undervaluation in certain modern awards. This includes priority attention to early childhood education and care workers, disability home care workers, and other social and community services workers. The proceedings for this initiative will begin shortly and aim to be completed by next year’s review.

The Fair Work Commission's decision to increase the National Minimum Wage and modern award minimum wages by 3.75% reflects a balance between addressing cost-of-living pressures and maintaining economic stability. The decision also underscores a commitment to gender equity in wage assessments.

For private practices, this wage increase is a significant development. It ensures that wages for administrative staff and nurses remain competitive and fair, supporting the wellbeing of those who provide essential health services. The decision will take effect from 01 July 2024, providing a timely adjustment to help mitigate financial stress for many employees in the healthcare sector.

If your practice needs support in implementing these changes or understanding how they affect your staff, please do not hesitate to reach out to Health Industry Employment Services. Their team of experts are here to help ensure a smooth transition and provide any necessary assistance.

Written by: George Sotiris
Director, Health Industry Employment Services
07 3386 6488  

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