COVID-19 Updates

Fair Work Commission Decision: Annual Wage Review 2019-20

Wage Calculation

The Fair Work Commission’s Expert Panel (Panel) handed down its Annual Wage Review 2019–20 decision this morning. This decision granted a 1.75% pay increase to Australia’s minimum wage (NMW) reliant and modern award covered employees.

However, the increase to wages in modern awards will be made in 3 groups with different operative dates:

  • Group 1 Awards – increases apply from 1 July 2020
  • Group 2 Awards – increases apply from 1 November 2020
  • Group 3 Awards – increases apply from 1 February 2021

The Road Transport and Distribution Award 2020, the Road Transport (Long Distance Operations) Award 2020 and the Clerks – Private Sector Award 2020 are all part of the Group 2 awards so the operative date of the increase will be from the first full pay period on or after 1 November 2020.

From 1 July 2020, the NMW will be $753.80 per week, or $19.84 per hour. This constitutes an increase of $13.00 per week to the weekly rate or $0.35 per hour to the hourly rate.

In arriving at their decision, the Panel noted that the economy has suffered a significant downturn and is leading to a recession, the first in 30 years. While there are some positive signs in the economy, recovery remains highly uncertain but even so the 1.75% increase is ‘likely to maintain the real value of the wages of NMW and award-reliant employees.’’

What to do

The decision to increase minimum rates of pay, including under modern awards, means that a typical employee in the road transport industry currently reliant on award wages will receive a pay rise from 1 November 2020.  Where employees are paid above these rates, employers may consider not passing on the increase. But get advice first.

Employers covered by modern awards or with employees receiving payments based on the NMW will need to review their arrangements to ensure that employees are paid correctly.

From 1 November 2020, employers covered by an enterprise agreement will need to make sure that the base rate of pay under their enterprise agreement is not less than the base rate of pay that would be payable under the relevant modern award.

NatRoad will provide further detail, including to members once we have analysed the Decision.

NatRoad’s experienced advisors are available to answer your questions on (02) 6295 3000 or email info@natroad.com.au