2022 Fair Work Commission wage increase
The decision of the Fair Work Commission (FWC) Expert Panel for annual wage reviews has increased the national minimum wage by 5.2% and the minimum rates of pay in modern awards by 4.6% subject to a minimum increase for adult award classifications of $40 per week. For modern awards, this means wage rates above $869.60 per week will receive a 4.6% adjustment whereas wage rates below $869.60 per week will receive a $40 adjustment.
The increase to the minimum rates of pay in the Federal Local Government Industry Award 2020 (Award) will come into effect from the first full pay period on or after 1 July 2022.
A summary of the decision can be found here.
Historic FWC wage increases are set out below for comparison.
| 1 July 2022 | |
| - National Minimum Wage | 5.2% |
| - Modern Award Rates | 4.6% or $40 per week (whichever is greater) |
| 1 July 2021 | 2.5% |
| 1 November 2020 | 1.75% |
| 1 July 2019 | 3% |
| 1 July 2018 | 3.5% |
| 1 July 2017 | 3.3% |
Applying the increase
This increase will need to be passed on by Local Governments operating in the Federal industrial relations system that:
- pay the minimum wage rates in the Award, and
- have federal enterprise agreements that incorporate increases to modern award wage rates.
If you apply the Award but pay wage rates higher than the minimum Award rates, you will need to review your internal policies and procedures and contracts of employment to determine when and how your Local Government usually provides wage increases.
Employers that have federal enterprise agreements containing set increases to pay rates (and exclude Award increases) will not need to apply this increase. However, as per section 206 of the Fair Work Act 2009 (Cth), Local Governments that have a federal enterprise agreement must ensure their enterprise agreement base wage rates are not less than the relevant Award minimum wage rates.
Wage schedule
The Award is published by the Fair Work Commission here with the current Summary of Hourly Rates of Pay and Monetary Allowances located in Schedule B & C respectively. The minimum rates of pay in the Award will be updated over the next few weeks with the increased rates to apply from the first full pay period on or after 1 July 2022.
State award wage increase
Local Governments operating in the State industrial relations system will be informed when the 2022 State Wage Case General Order is published by the Western Australian Industrial Relations Commission.
Superannuation guarantee increase from 1 July 2022
A reminder that the next increase to the superannuation guarantee rate is planned for 1 July 2022, where it will increase by 0.5 percentage points to 10.5 per cent, and will eventually reach 12 per cent by 1 July 2025.
From 1 July 2022, employees will be eligible for the superannuation guarantee regardless of how much they earn. The threshold of $450 per month (before tax) under which employees do not need to be paid the superannuation guarantee by their employer is being removed. The removal of the threshold will apply from 1 July 2022. For more information please see the ATO website here.
If you have any questions about this alert, please email WALGA Employee Relations or call 1300 366 956.
