Employers should be aware several new financial year changes to payroll and other obligations are now in effect.
It follows the Fair Work Commission (FWC) last month releasing the findings of its Annual Wage Review, providing a 2.5% increase to the national minimum wage (NMW) and modern award minimum wages (related article here).
For awards in most industries the increase came in effect from the first full pay period that starts on or after 1 July 2021.
Another change in effect from 1 July is the high-income threshold under the Fair Work Act has increased to $158,500 and the compensation limit is now $79,250 for dismissals occurring on or after 1 July 2021. If an employee is not covered by an award or enterprise agreement, they must have an annual rate of earnings less than the high income threshold in order to pursue an unfair dismissal case.
The application fee for dismissals, general protections and bullying at work applications made under sections 365, 372, 394, 773 and 789FC of the Fair Work Act 2009 has also increased to $74.90 from 1 July.
In addition, the FWC has published an updated version of the Unfair dismissals benchbook and the General protections benchbook to reflect:
- increases to the application fees, the high income threshold and the compensation limit
- recent amendments to the Fair Work Act in relation to casual employees, and
- the current value of a penalty unit.
Super guarantee increase
In addition, the Superannuation Guarantee rose from 9.5 per cent to 10 per cent on 1 July.
Under the superannuation guarantee, employers have to pay superannuation contributions of 10% of an employee’s ordinary time earnings when:
- an employee is paid $450 or more before tax in a month and is:
- over 18 years, or
- under 18 years and works over 30 hours a week.
If eligible, the super guarantee applies to all types of employees including:
- full-time employees
- part-time employees
- casual employees.
Temporary residents are also eligible for super.
Super has to be paid at least every 3 months and into the employee’s nominated account.
The ATO can give advice and assistance on superannuation issues, including on the super guarantee. Find out more at:
The rise means the cap on concessional super contributions made into employees’ super funds will rise from $25,000 to $27,500 per annum from 1 July 2021. Employees who currently pay only up to the amount of the cap can advise their employer if they wish to contribute the higher amount.
The Superannuation Guarantee maximum contribution base will also increase to $58,920 per quarter and $235,680 per year, an important change for employers who do not pay above the maximum contributions base.
AREEA’s expert Workplace Relations Advisory Team is available to advise and assist in these processes. Email [email protected] to be put in touch with your local advisory team member.
Wage underpayment now a crime in Victoria
Deliberately underpaying employees or dishonestly withholding employee entitlements became a crime in Victoria on 1 July 2021.
Thee crimes are punishable by a fine of up to $218,088 or up to 10 years’ jail for individuals and a fine of up to $1,090,440 for companies.
It is now a crime to:
- deliberately underpay employees
- dishonestly withhold wages, superannuation or other employee entitlements
- falsify employee entitlement records to gain a financial advantage
- avoid keeping employee entitlement records to gain a financial advantage
Employer information
Pay and conditions
Employers must provide their employees with at least the minimum pay and conditions outlined in the relevant award, workplace agreement, contract of employment or legislation and keep employee entitlement records.
Information about pay rates and employee entitlements is available from the Fair Work Ombudsman.
Victoria’s wage theft laws target employers who deliberately and dishonestly withhold wages and other worker entitlements. Honest mistakes made by employers who exercise due diligence in paying wages and entitlements are not considered wage theft.
Join AREEA’s ongoing blitz on compliance
Underpayments and non-compliance with Modern Awards and enterprise agreements can have huge implications for employers. With new headlines of underpayments appearing on a seemingly daily basis, AREEA’s members are determined not to join the growing list of companies and sectors to have made compliance mistakes.
AREEA’s specialist workplace consultants are on a compliance blitz and available to provide support and assistance. Some of our key compliance activities and support include:
- Payroll process audits to ensure full compliance with the new annualised salary administrative rules
- Roster Compliance training to provide the skills to create and calculate rosters that comply with the NES and requirements under Modern Awards and enterprise agreements
- Advice on the risks, exposure and obligations of landmark determinations on personal leave and casual entitlements
Contact AREEA’s specialist workplace consulting team today to join our compliance blitz.
