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2.67 million Aussies to get major pay rise

The minimum wage will increase to $23.23 per hour.

Tamika Seeto
·Finance Reporter
Updated ·2-min read
Young people walking through city in Australia. Australian money notes. Minimum wage pay rise concept.
The Fair Work Commission has handed down its minimum wage decision. (Source: Getty)

Millions of Aussies on award and minimum wages will receive a 5.75 per cent pay boost following the Fair Work Commission’s annual wage review decision today.

This means the country’s lowest-paid workers will now be paid $23.23 per hour, or $882.80 per week, from July 1.

Worker salaries have been reducing in real values, with inflation at 6.8 per cent in the year to April.

Fair Work Commission president Justice Adam Hatcher said the panel placed “significant weight” on the impact the current rate of inflation was having on workers' abilities to meet their basic financial needs.

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“Inflation is reducing the real value of these employees’ incomes and causing households financial stress,” Hatcher said.

The panel acknowledged the increase would not maintain the real value of minimum wages, nor reverse the reduction in real value that had occurred over recent years.

“However, the level of wage increase we have determined is, we consider, the most that can reasonably be justified in the current economic circumstances,” Hatcher said.

The panel said it wanted to avoid “entrenching high inflation expectations” by taking a perceived wage indexation approach. It also noted the superannuation guarantee rate would increase this year - with the rate increasing from 10.5 per cent to 11 per cent on July 1.

The minimum wage decision is about halfway between what the Australian Council of Trade Unions (ACTU) and the Australian Chamber of Commerce and Industry were calling for.

The ACTU was calling for a 7 per cent increase to the minimum wage, while the Australian Chamber of Commerce and Industry was calling for a 3.5 per cent increase in award rates.

The minimum wage is currently $21.38 per hour, or $812.60 per week, after the Fair Work Commission awarded a 5.2 per cent rise last year.

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