What changed for employers on 1 July 2018?

Employment changes

The Employment & Industrial Relations Team here at Meyer Vandenberg have put together for you a quick summary of the employment-law changes that commenced on 1 July 2018.

Minimum Wages

Not Award Covered

The National Minimum Wage is now $719.20 per week or $18.93 per hour. This is a 3.5% increase on the 2017 Annual Wage Review. In the 2017-18 financial year, the minimum wage was $694.90 per week or $18.29 per hour.

Employers that are not covered by a Modern Award must ensure that they are complying with the National Minimum Wage Order.

Award Covered

The rates in the Modern Awards have also increased. The Fair Work Ombudsman has updated their pay guides with the new pay rates.

A failure to pay the National Minimum Wage or to comply with an Award is a breach of the Fair Work Act 2009(Cth), attracting penalties of up to $63,000 for a body corporate or $12,600 for an individual.

If you are unsure whether an Award covers your employees, or what classification an employee might be under an Award, contact us for help.

Penalty Rates

On 23 February 2017 the Fair Work Commission determined that the penalty rates under various awards should be reduced (click here for our previous eBrief about this).

The FWC’s determination is now in effect such that Sunday penalty rates for permanent and casual employees covered by the following Awards are reduced:

  • Fast Food Industry Award 2010
  • General Retail Industry Award 2010
  • Hospitality Industry (General) Award 2010
  • Pharmacy Industry Award 2010

We recommend employers review the Pay Guides issued by the Fair Work Ombudsman to confirm they are paying the correct penalty rates.

General Skilled Migration

Applicants for Skilled Migration Visas (Visa subclasses 189, 190 and 489) must now obtain 65 points for a visa. This is an increase up from 60 points.

The points table issued by the Department of Home Affairs shows that 5 points is the difference between:

  • having less than 3 years of skilled employment outside Australia, and having more than 3 years;
  • being aged 33-39 years old, or being 25-32 years old; or,
  • having a diploma or trade qualification or having a Bachelor degree.

High Income Threshold

Employees now earning more than $145,400 per annum, and who are not covered by an Award or Enterprise Agreement, cannot bring an Unfair Dismissal claim.

This is an increase from $142,000 in the 2017/18 financial year.

Employers calculating the High Income Threshold should not include:

  • payments which cannot be calculated in advance such as:
    • commissions;
    • incentive-based payments and bonuses;
  • reimbursements; and
  • statutory superannuation contributions.

If you have any questions about which of your employees might be excluded from Unfair Dismissal, or you need some guidance with calculating the High Income Threshold, contact us for help.

Single Touch Payroll

Employers with 20 or more employees must now use Single Touch Payroll (STP). This means that employers set up with STP will have their payroll information sent directly to the Australian Taxation Office from their payroll system. This includes:

  • salaries and wages;
  • pay as you go withholding; and
  • superannuation.

The 20 employee headcount is calculated with reference to 1 April each year, and does not include contractors or volunteers.

There will be no penalties imposed for the first 12 months for late submission of STP reports, and there will be a grace period offered for incorrect data included on STP reports.

The rollout of STP will extend to employers with 19 or more employees on 1 July 2019.

Your payroll software or payroll service provider should have been in contact to let you know about the changes, and to confirm that you are set up for STP.

If you have any questions about STP, or if you are concerned you have not been paying superannuation correctly, contact us for help.

Our specialist Employment & Industrial Relations Team is

William Ward | Special Counsel
(02) 6279 4444

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