HSA July 2023

W O R K P L A C E R E L A T I O N S
Annual Wage Review 2022-23
OWEN WEBB - AHA|SA WORKPLACE RELATIONS MANAGER
On 2 June 2023, the Fair Work
Commission Annual Wage Review
Panel (Panel) handed down their
decision in the 2022-23 Annual
Wage Review.
Modern Award Wages
The Panel decided to increase all
modern award minimum wage
rates by 5.75% effective from the
first full pay period commencing
on or after 1 July 2023.
In the last two Annual Wage
Reviews, previous Panels had
taken the view that there were
exceptional circumstances that
existed to warrant a delay in the
commencement of the increase
for awards in specific industries.
The 2022-23 Panel were not of
the view that any exceptional
circumstances existed to
warrant a delay in the increase.
The effect of the 2022-23 Annual
Wage Review decision is that
for those employees employed
pursuant to Modern awards in the
hotel and retail sector such as the
Hospitality Industry (General) Award
2020, Restaurant Industry Award
2020, Registered and Licensed
Clubs Award 2020 and General
Retail Industry Award 2020, base
rates of pay will increase by 5.75%.
To put the increase into context as
an example, the rate of pay for any
work performed between 7:00am
to 7:00pm Monday to Friday for a
casual food and beverage attendant
wage level 3 classification under the
Hospitality Industry (General) Award
2020 will increase from $29.40 per
hr (inclusive of 25% casual loading)
to $31.09 per hr.
National Minimum Wage
The National Minimum Wage
(NMW) has since 1997 been
aligned to the C14 wage rate in
modern awards. The NMW does
not set a floor for minimum wage
rates in modern awards and the
NMW order does not apply to
employees covered by a modern
award or an enterprise agreement.
There is therefore only a very small
proportion of the workforce (0.7% of
employees) who are paid the NMW.
The Panel concluded in the 2022-23
Wage Review that the C14 wage
rate does not constitute a proper
minimum wage safety net for
award/agreement free employees
in ongoing employment. The Panel
therefore decided as part of the
Review to undertake two steps in
relation to the NMW. The first was
to end the alignment between the
NMW and the C14 wage rate in
modern awards and the second
was to increase the rate of the
NMW by 5.75%.
The effect of the Panel’s decision
is that the NMW increases from
$812.60 per week, calculated
based on a week of 38 ordinary
hours, or $21.38 per hour, to
$882.80 per week or $23.23 per
hour, effective from the first full
pay period on or after 1 July 2023.
The change to the NMW does not
affect the wage rates of those
employed pursuant to a Modern
Award or an Enterprise Agreement.
Considerations
The Panel as part of the Annual
Wage Review process received
submissions from various
interested parties including state
and federal governments, unions
and employer associations.
The Australian Council of Trade
Unions proposed a 7% increase to
the NMW and modern award wages,
whilst the Australian Chamber of
Commerce and Industry supported
an increase of up to 4% (3.5% plus
the legislated 0.5% Superannuation
Guarantee increase).
The panel noted that while
submissions from interested parties
had been taken into account in
making its decision, ultimately it
needs to make its own assessment
of what constitutes a safety net of
fair minimum wages having regard
to the prescribed considerations.
In reaching their decision as to
the quantum of the increase the
Panel placed significant weight on
the impact of the current rate of
inflation on the ability of modern
award-reliant employees to meet
their basic financial needs. The
Panel also considered the recent
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