Employment Law updates unpacked: What every employer needs to know
As we approach the halfway mark of the year, significant changes are underway in Australia’s employment law landscape.
The changes to come into effect will impact workplaces nationwide, necessitating employers’ understanding of their implications. This article provides an overview of the upcoming changes.
AS OF 1 JULY 2024
Wages and Superannuation
Each year, the Fair Work Commission reviews both the National Minimum Wage and minimum pay rates under modern awards. National Minimum wage will increase by 3.75% and will be $915.90 per week or $24.10 per hour. The Fair Work Commission has announced that the award rates of pay will also be increased by 3.75% effective from 1 July 2024.
Employers need to review their current employee pay rates and ensure their employees are paid commensurate to their minimum wage entitlements. Even employers currently paying above minimum award rates should review their arrangements to ensure they are not suddenly underpaying staff as a result of these changes.
Further from 1 July 2024, the Super Guarantee will increase from 11% to 11.5%. Employers need to ensure that they are paying the correct superannuation contributions on behalf of their employees from 1 July 2024.
Underpayment claims of employees carry onerous penalties. A court may order those in breach of underpayment provisions of the Fair Work Act 2009 (Cth) to be fined, per contravention of a non-serious contravention, up to $18,780 for an individual, $93,900 for a company with less than 15 employees and $469,500 for a company with more than 15 employees.
Compensation Cap and High-Income Threshold
The high-income threshold will rise to $175,000 from 1 July 2024. The high-income threshold operates as a limit to an employee’s eligibility to bring an unfair dismissal claim at the Fair Work Commission. As long as an employee is not covered by a modern award or an enterprise agreement, an employee who earns over the high-income threshold will not be protected from unfair dismissal.
Also effective from 1 July, the compensation limit in Unfair dismissal cases will be $87,500 for dismissals occurring on or after 1 July 2024.
Parental Leave Increase
Parental leave pay available to eligible families will be increase from 20 weeks to 22 weeks in circumstances where the date of the child’s birth or adoption is from 1 July 2024.
AS OF 26 AUGUST 2024
Additional changes in the employment space will come into effect from 26 August 2024, including introduction of the right to disconnect for eligible employees, changes to the definition of “casual employee”, provision for employee like workers and the road transport industry, independent contractor unfair contracts disputes and how to determine if an employee is an independent contractor or employee.
OUR RECOMMENDATIONS
We recommend employers to take the following steps:
- Conduct a thorough review of existing employment contracts and consult with legal professionals to make necessary amendments in accordance with the new legislation and any applicable relevant industrial instrument.
- Review pay structure to ensure compliance with the minimum superannuation rates and minimum wage rates as stipulated in the National Employment Standard and relevant modern awards.
- Ensure that those responsible for approving parental leave requests are well-informed about the rules.
If you have any questions or require further guidance regarding these upcoming changes, our experienced employment team is here to assist you. Please do not hesitate to reach out to Amy La Verde for all your employment law needs.
