The second tranche of award rate increases for FY20/21 will commence from the first full pay period on or after 1 November 2020. Employers with employees covered by the modern awards affected by this change must ensure that they review pay rates to avoid the risk of underpaying staff.
Why are some award rates increasing on 1 November?
Back in June, the Fair Work Commission's 2019/20 Annual Wage Review resulted in a 1.75% increase to the national minimum wage (NMW) and modern award rates. While the increase to the NMW was effective from 1 July 2020, the timing of the increases for award covered employees was staggered in recognition that the economic impact of the COVID-19 pandemic has not been consistent across all sectors.
Modern awards were grouped with reference to the impact of the pandemic on the relevant industry or occupation. Those modern awards covering industry sectors apparently affected less by the pandemic than others were classified as Group 1 and had their minimum rates increased along with the NMW on 1 July 2020.
The modern awards in Group 2 largely cover industry sectors that were adversely impacted by the pandemic, but not to the same extent as those classified as Group 3.
What awards are in Group 2?
There are 73 modern awards in Group 2, including:
A full list of the Group 2 modern awards can be found here. In our experience, most employers will find that they have employees covered by the Clerks – Private Sector Award 2010, which covers employees who are not otherwise covered by an industry-based award and who work in clerical roles. Examples of such include secretaries, executive assistants, receptionists, payroll or accounts officers, and even office managers. It can therefore be risky to assume an award does not cover any employees in your organisation.
What do I need to do?
If you have employees covered by a Group 2 award, you need to take the following action:
Underpaying employees, even inadvertently, can have serious consequences in terms of penalties, so it's best to ensure compliance at the earliest opportunity.
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