blue

A Complete Guide To the Australian Minimum Wage for Employers in 2021

Over the last few years, there has been an increasing number of cases related to wage underpayments in Australia. Several businesses were highlighted with regards to wage underpayment and were asked to pay penalties. Consequently, Fair Work Australia committed to putting their efforts into removing such practices.

In this article, you will understand what is the average hourly wage in Australia.

What is the Minimum Wage?

The Fair Work Commission reviews award minimum wages every year. Based on the review analysis, they set the minimum wage for those employees not covered by an award or an agreement (better known as award-free employees) in a decision called the National Minimum Wage Order. Businesses and employees under the National Workplace Relations System are impacted by this decision. Most private businesses in Australia are covered by the Fair Work Act 2009.

You can also check out the list of Australian award wages at https://www.fairwork.gov.au/.

What is the Minimum Wage in Australia 2021?

As of 1st July 2021, the Fair Work Commission has increased the minimum wages in retail, food services, accommodation, and various other industries by 2.5%. Last year, the minimum wage increased by just 1.75% to $19.84 per hour. Compared to the previous three year's records, the minimum wage increase for 2020 was the lowest. The reason for the same could be because of national economic performance, cost-of-living, and inflation rate. The Fair Work Commission’s decision is completely based on the previous trends of all these factors.

Here are detailed Australian minimum wage rates (since 2007):

Date of Commencement

Per Hour

Per 38 Hour Week

1 October 2007               

    $13.74

$522.12

1 October 2008               

$14.31

$543.78

1 July 2009

Constant

Constant

1 July 2010

$15.00

$569.90

1 July 2011

$15.51

$589.30

1 July 2012

$15.96

$606.40

1 July 2013

$16.37

$622.20

1 July 2014

$16.87

$640.90

1 July 2015

$17.29

$656.90

1 July 2016

$17.70

$672.70

1 July 2017

$18.29

$694.90

1 July 2018

$18.93

$719.20

1 July 2019

$19.49

$740.80

1 July 2020

$19.84

$753.80

1 July 2021

$20.33

$772.60

 

What are Penalty Rates?

As a legal requirement, all employers need to pay their employees a higher penalty rate when working on public holidays, overtime, weekends, late night or early morning. The penalty rate varies from one award to another. As of 1st February 2021, all full and part-time employees covered by the General Retail Industry Award 2010 are supposed to have a 25% loading on a Saturday and 50% on a Sunday.

What Is The Minimum Wage For Juniors?

Anyone working under the age of 21 is considered a junior employee in Australia. The minimum wage for junior employees may vary depending on their age and the industry they are working in. The wage rate is determined as a percentage of the national minimum wage.

Under General Retail Industry Award, junior employees are paid at the following percentage of the wage rate:

Age    

Percentage

Under 16

45%

16

50%

17

60%

18

70%

19

80%

20 (employed for 6 months or less)

90%

20 (employed for more than 6 months)

100%

 

Who Sets The Minimum Wage Rate in Australia?

The minimum wage rate is set by the Fair Work Commission’s Expert Panel. Every year, the panel reviews the current minimum wage and issues a decision. The issued decision by the panel comes into effect on 1st July of every financial year. Several people are present on the expert panel, namely:

  • A president
  • Three other full-time members
  • Three part-time members

The panel includes experts who have a vast knowledge of workplace relations, economics, social policy, and commerce.

Under the Fair Work Act (2009), the panel publishes written submissions from interested individuals or organisations and makes comments on them. The act demands that the research conducted by the panel should be published to ensure maximum transparency.

Common FAQs Related To Australia's Minimum Wage

1. What is Australia's minimum wage 2021?

As of 1st July 2021, the minimum wage for full-time employees in Australia is $20.33 per hour or $772.60 per 38-hour week. On the other hand, casual employees receive 25% loading.

2. What is the minimum wage for 16-year-olds in Australia?

For 16-year-olds, the full-time weekly rate (38 hours) is $389.50 and the casual hourly rate (includes 20% loading) is $12.30.

3. What is the minimum wage for a 22-year-old in Australia?

If you are a full-time employee and have no award or enterprise agreement, you must be paid at least $19.84 per hour. In the case of casual employment, you will secure casual loading for minimum hourly wage up to $24.80.

4. Can you live on minimum wage in Australia?

Surviving on a minimum wage in Australia depends on a variety of factors - your lifestyle, habits, expenditure, and more. You can easily balance things to live on a minimum wage.

Keep your payroll and attendance activity agile by choosing our outsourced payroll service. ClockOn also helps businesses streamline their reporting obligation by offering cost-effective Single Touch Payroll (STP) solutions. Get in touch with us to know more about our payroll and STP services.

Tags: Payroll

Comment

Related Post