The minimum wage, as its name implies, is the minimum payment you’re entitled to per hour while employed. Currently, Australia’s minimum wage is $17.70 per hour, and causal employees get at least 25% loading. So, how does this measure up on a global scale? Pretty well, it turns out.
What Is the National Minimum Wage?
The national minimum wage (NMW) is a base rate of pay for ordinary hours – not overtime – worked, and it depends on the award, enterprise agreement, pay scale or wage order that applies to the employment. It is underpinned by legislation, and employers and employees can’t agree to a rate of pay that’s less than the minimum wage.
An expert panel at the Fair Work Commission (FWC) reviews minimum wages in Australia annually and any adjustments take effect on 1 July each year. Under modern awards, minimum wages may include:
- Wages for adults – in some cases, different rates for experience and qualifications
- Wages for juniors, those with a disability or with training provisions in place
- Casual loadings
- Piece rates – payment for each item produced
Where are we now?
Last year, the Fair Work Commission’s Annual Wage Review (AWR) saw a 2.4% increase to Australia’s NMW – or an average weekly income of $672.70 for Australia’s lowest paid workers.
For Australians not covered by a modern award or enterprise agreement – usually casual or part-time workers – the NMW would apply. This means a guaranteed hourly rate of $17.70, adding up to an extra $15.80 per week for 1.8 million of Australia’s low-income earners.
Comparing Minimum Wages
Despite the recent increase to Australia’s NMW, for some, our minimum may still seem quite low. For a fair perspective, we compare Australia’s NMW with some of the world’s biggest economies:
• United Kingdom: AU$14.66 per hour
• New Zealand: AU$14.22 per hour
• France: AU$14.98 per hour
• Germany: AU$13.17 per hour
• Canada: AU$10.45–AU$13.81 per hour
• United States: AU$10.08 per hour
• Japan: AU$10.01 per hour
• Mexico: AU$5.50 per hour
• China: AU$1.68–AU$3.93 per hour
• Brazil: AU$341.16 per month
• India: AU$3.09–AU$7.44 per day
When compared with other economies, it’s clear Australia is paving the way for the underprivileged with, arguably, the most generous minimum wage in the developed world.
As your business grows or changes occur, particularly in the AWR, you must be aware of your financial reporting regulations, including keeping detailed records of all types of staff payments. Using accounting software such as QuickBooks Online can also help take the hassle out of your monthly payroll procedures.
Information may be abridged and therefore incomplete. This document/information does not constitute, and should not be considered a substitute for, legal or financial advice. Each financial situation is different, the advice provided is intended to be general. Please contact your financial or legal advisors for information specific to your situation.