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Insight

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  • Writer's pictureSally Davies

1 July 2023 Changes to Employee Entitlements

1 July always sees a flurry of changes in the employment law sector, and this year is no different. A summary of the most significant changes are as follows:


A. Increase to National Minimum Wage


For employees who are not covered by an award or an agreement, from 1 July 2023, the new National Minimum Wage has increased to $23.23 per hour (up from $21.38), or $882.80 per week (up from $812.60).


B. Increase to Award Minimum Wage


For employees that are covered by an award, the minimum wages have been increased by 5.75%.


If you employ any staff under an Award, we strongly encourage that you review the pay guide for your applicable Award to check that the appropriate hourly rate is being paid. The pay guide for each Modern Award is available here: https://www.fairwork.gov.au/pay-and-wages/minimum-wages/pay-guides


C. Other Award changes


(a) Employees under the Supported Employment Services Award


This Award changed from 30 June 2023, including changes in relation to minimum rates, classifications and supported wage assessments. If you employ any staff under this Award, or are employed under this Award, we strongly encourage you to review the changes. More information is available here: https://www.fairwork.gov.au/newsroom/news/changes-to-supported-employment-services-award


(b) Certain aged care employees


Direct care and certain senior food service employees in the aged care sector who are employed under the Aged Care Award, Social, Community, Home Care and Disability Services Industry (SCHADS) Award, or Nurses Award are eligible for a 15% wage increase. This is in effect from 30 June 2023 and is a separate decision to the increase referred to in point B (above). More information is available here: https://www.fairwork.gov.au/newsroom/news/15-per-cent-wage-increase-aged-care-sector


D. Increase to Superannuation Guarantee


From 1 July 2023, the superannuation guarantee rate has increased to 11% (from 10.5%).


This new rate is to be applied to calculate any superannuation payments on or after 1 July 2023, even in circumstances where some of the pay period is from pre-1 July 2023.


E. Paid Parental Leave


Effective from 1 July 2023, the key changes to the paid parental leave scheme are as follows:


  • The “Dad and Partner Pay entitlement” has been combined with the existing Paid Parental Leave scheme, meaning that the paid parental leave entitlement is now a maximum of 20 weeks.

  • If employees are coupled, the couple can share the 20 weeks between them (with each partner to take at least 2 weeks leave).

  • The scheme is capped for families with a combined income of $350,000 (indexed annually from 1 July 2024).

  • The leave can be taken in multiple blocks of time until the child is 2 years of age.

  • There is no longer a requirement to return to work to be eligible to receive the entitlement.

  • Any unused part of the entitlement is forfeited.


Please note that these changes only apply to employees whose child is born or adopted from 1 July 2023.


We encourage employers to review their parental leave policies to ensure that they are complying with the new entitlements.



F. Increase to High Income Threshold


From 1 July 2023, the high-income threshold increased to $167,500 per annum. This means that employees earning above this threshold are no longer covered by the applicable award for their position, and cannot file an unfair dismissal application. This change also means that the maximum compensation that an employee can receive in an unfair dismissal application is $83,750 (i.e.: 26 weeks).


G. Fair Work Information Statement


An updated information statement has been released by Fair Work. This statement needs to be provided to all new employees from 1 July 2023 onwards. The sheet is available from the Fair Work website: https://www.fairwork.gov.au/sites/default/files/migration/724/Fair-Work-Information-Statement.pdf


If you need assistance in relation to employment law matters, please contact Jenkins Legal & Advisory on 02 4929 2000 or email office@jenkinslegal.com.au.


This article is not legal advice and the views and comments are of a general nature only. This article is not to be relied upon in substitution for detailed legal advice.


 

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