FAQ – Rates of Pay Guide and Award Wage increase

On Friday 2 June, the Fair Work Commission increased the national and award minimum rates of pay by 5.75% for the 2023-24 financial year. During this time it can be quite common for practice owners and practice managers to have some questions about what this means for them and their staff.

What will the increase be for my staff covered by the Health Professionals and Support Services Award and Nurses Award? 
The Award Minimum Wage will increase by 5.75%, applicable to employees under both the Health Professional and Support Service Award 2020 and the Nurses Award 2020. This is subject to a minimum increase for award classifications based on a 38 hour week for a full-time employee. This includes applicable increases in penalty rates and allowances for all full-time, part-time and causal employees.

*Please also note that the Super Guarantee will increase to 11% from July 1 2023. Employers will need to use this new rate to calculate super on payments made to employees on or after July 1. 

What do I do if my staff are being paid the award minimum rate of pay? 
If staff are being paid at the minimum award rate, it will be necessary to increase their rate of pay to the new award minimum. This means you will need to discuss and confirm with your employees their new rate of pay. Confirmation of their new rate should be communicated in writing via email correspondence or by way of a letter of amendment to their contract. 

Be clear with staff about what the change in rate is and how much it varies by. 

What if my staff are being paid above the award, do I need to increase their hourly rate?
Staff already being paid above the award rate may not need to receive an increase in pay. It is important that employers refer to the new Rates of Pay Guide to see what the rate of pay has increased to for their classification and pay point levels. If your employee’s current above award rate is still above the minimum within the guide, you may not need to increase their hourly rate of pay. 

How does this impact my employees on a Grossed up Wage Contract?
If staff are being paid above the minimum award rate and you are absorbing certain entitlements into their above award wage, you may need to increase their rate of pay to ensure they remain better off under the agreement. Review your staff’s better off overall test (BOOT) calculations to identify if their rate of pay should be reconsidered to accommodate the increases. For our Workplace Relations Toolkit subscribers, the Workplace Relations team can check how much better off overall staff remain complimentary within your subscription.  

When do I need to increase my employee’s hourly rate of pay?
As the new award minimum rates of pay are effective from 1 July, applicable staff will receive an increase in their rate of pay from 1 July. This may mean some staff will receive two different rates of pay within this time.

For example, if your payment period is fortnightly and you have staff who are paid the award minimum rate of pay, the following rates would apply for the period 26 June to 10 July. From Monday 26 June to Friday 30 June, they will receive their current hourly rate of pay. From 1 July to 10 July, they will receive the new award minimum hourly rate of pay. Please see below diagram for an example.

Are my Workplace Relations contract templates affected? Do I need to purchase new ones?
AMA Queensland’s Workplace Relations contract templates are purposely drafted to generally refer to the applicable award to ensure that when most changes occur, you do not need to change or purchase new templates. 

However, the workplace relations employment contract templates provided to members have recently been reviewed and updated by a legal team and therefore now is a great time to look at updating your contracts. 

Do all my employee contracts need to be reviewed and updated? 
Each financial year when there is a pay increase and change in superannuation contributions, there is an opportunity to review your staff’s employment contracts, including any templated contracts to determine whether they offer the maximum protections for your practice and remain in line with best practice.

When to update an employment agreement is dependent on each individual employee and it generally starts with how old their current agreement is and have they changed positions since the contract was issued.

If, however, the terms and conditions of the employment agreement remain unchanged then a letter outlining the variations to the employment agreement may be an appropriate approach.

For casual employees on AMA Queensland contracts, it would be advisable to issue new contracts due to a recent update in line with recent legal recommendations. If you are unsure which scenario applies to you, please feel free to reach out to the Workplace Relations Team.  

	Workplace Relations Support  Workplace Relations Support can assist members and their practice managers with any award related and rates of pay queries you may have. You can contact us via phone (07) 3872 2222 and email support workplacerelations@amaq.com.au.
	Workplace Relations Toolkit Workplace Relations Toolkit subscribers receive priority service when they contact the Workplace Relations Team on any queries they may have.
	Workplace Relations Consultancy Workplace Relations Consultancy can help guide practice owners and managers through increasing an employee’s rate of pay and what the appropriate method might look like for your practice.