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Gemma Wheeler Carver, Senior Associate, in our Employment and Dispute Resolution teams, has outlined the wage increase announcement made by the Fair Work Commission.

Wage increase 

The Western Australian Industrial Relations Commission announced on Thursday, 23 June 2022 that the minimum adult wage for State system employers (sole traders, partnerships and some trusts and incorporated associations) will increase by $40.90 to $819.90 per week from 1 July 2022. For those covered by State Awards, the rates will also increase, by $40.90 per week for those earning below $887.40 per week and those above that rate increasing by 4.65%. 

Junior rates and rates for apprentices and trainees will also increase proportionately. 

The new rates apply from the first pay cycle on or after 1 July 2022. 

This follows the announcement the previous week by the Fair Work Commission that the Federal minimum wage (for Pty Ltd companies, most incorporated associations and foreign entities) will increase by 5.2% to $812.60 per week (or $21.38 per hour) from 1 July 2022. Increases to rates under the federal Awards will be 4.6 percent for wages above $869.60 per week and $40 per week for those below that figure. Although most increases will occur on 1 July 2022, for the aviation, tourism and hospitality industries, this increase will be delayed until 1 October 2022. 

It is important that all employers take the opportunity to:  

  • Check whether they are in the Federal (national) or State system; 
  • Check which Awards (if any) apply to their employees;  
  • Work out into which classification each employee falls;  
  • Confirm that all employees’ hourly rates exceed the minimum wage (including any casual loading, penalties, and overtime rates);   
  • Update any employment contracts or individual flexibility arrangements.  

Underpaying an employee or otherwise breaching a modern Award can result in penalties for both an employer and directors or other officers. From 1 July 2022, these penalties may also be increased.  

This can also be a useful time to review employment contracts across your team, ensure your payroll software is suitable for your requirements, and update your employee records before the end of the financial year. For more end of financial year tips, see our article here

High-income threshold:  

From 1 July 2022, the high-income threshold has increased to $162,000.

  • Determining eligibility to make an unfair dismissal claim. A claim may only be made if an employee’s salary is less than this amount or that employee is covered by a Modern Award.   
  • Determining whether a Modern Award applies to an employee. If an employee’s salary is the subject of an annual guarantee of earnings above the high-income threshold, then terms of any
  • Award that covers that employee and otherwise would apply does not apply.   
  • Determining the maximum compensation for an unfair dismissal claim. If successful in an unfair dismissal claim, an employee may receive a maximum of 26 weeks of their usual salary, or 50% of the high-income threshold amount, whichever is lower.  

Our team is highly skilled and experienced in advising on all aspects of Employment Law and Dispute Resolution. Contact us today if you need advice or representation in this area.

Updated 28 June 2022

*The information provided in this website serves as a general guide and does not constitute legal advice. It is based on our research and experience at the time of publication. Please consult our knowledgeable legal team for any specific inquiries or advice relevant to your circumstances, as the content may not have been updated subsequently.