18 Jul Minimum wage increase from July 1 2014
What should employers do?
At present a total of approximately 120 modern awards exist throughout Australia which operate along industry and occupational lines to set out minimum terms and conditions of employment for those employees who fall within their coverage.
Employers should consider whether any of their employees are covered by a modern award if they have not done so already and, if they are covered, carefully review the rates of pay and conditions being afforded to the employees to ensure they will meet their obligations under the award from 1 July 2014.
Employers who are covered by an enterprise agreement should also review the agreement to ensure that the base rates of pay for the employees under the enterprise agreement are not less than those that would be payable under the relevant modern award.
For those employees who are not covered by a modern award or enterprise agreement, employers should take steps to ensure they are paying those employees an amount of wages not less than the National Minimum Wage from 1 July 2014.
Why is this important?
There are significant sanctions available against employers that do not comply with an applicable modern award, enterprise agreement or the National Minimum Wage (as the case may be), including civil penalties of up to $51,000 per breach as well as orders for compensation for any damage suffered as a result of the breach.
For example, the Federal Circuit Court recently fined two companies that operated La Porchetta pizza and pasta restaurant franchises in Pakenham and Berwick and their owner the total sum of approximately $335,000 for failing to pay employees the applicable minimum pay rates as well as other award and statutory entitlements (see Fair Work Ombudsman v Bound for Glory Enterprise Pty Ltd and Anor  FCCA 432 (6 June 2014) and Fair Work Ombudsman v Zillion Zenith International Pty Ltd and Anor  FCCA 433(6 June 2014)).