Round up of the key employment law and tax changes for the 2022/2023 financial year

The commencement of the new financial year brings with it important changes to minimum wages, unfair dismissal regulation and various tax thresholds and rates.

In this article, Partners Andrew Tobin and Michael Patane, Special Counsel Alana Paterson, Associate Natalie Wissa and Solicitor John Hickey, have summarised the significant changes employers need to be aware of. Depending on your individual circumstances, immediate action may be required from 1 July 2022 to ensure ongoing regulatory compliance.

Increases to minimum wage rates for national system employers

Modern award rates

In accordance with the 2022 annual wage review decision of the Fair Work Commission, all modern award rates of pay will increase by $40.00 per week or 4.6% (whichever is greatest).

This increase will commence from the first full pay period on, or after, 1 October 2022 for the following awards:

• Aircraft Cabin Crew Award 2020
• Airline Operations – Ground Staff Award 2020
• Air Pilots Award 2020
• Airport Employees Award 2020
• Airservices Australia Enterprise Award 2016
• Alpine Resorts Award 2020
• Hospitality Industry (General) Award 2020
• Marine Tourism and Charter Vessels Award 2020
• Registered and Licensed Clubs Award 2020
• Restaurant Industry Award 2020.

For all other awards, this increase will commence from the first full pay period on, or after, 1 July 2022.

National minimum wage

From 1 July 2022, the national minimum wage for adults working full time (38 hours per week) has increased from $772.60 ($20.33 per hour) to $812.60 ($21.38 per hour). 

The casual loading for award/agreement free employees remains set at 25%, consistent with the standard casual loading in modern awards.

The above changes apply to all workers in the national system including:

• junior employees; 
• employees to whom training arrangements apply; 
• employees with a disability; and
• to piece rates, through the operation of the methods applying to the calculation of those wages. 

It is imperative that all employers conduct an annual review of their remuneration arrangements with their employees to ensure ongoing compliance with minimum wage rates.  

Changes to minimum wage rates for WA system employers

For those employers in WA who are outside the national system, effective from 1 July 2022:

• the minimum wage has increased from $779.00 to $819.00 per week (i.e., the WA minimum wage will be $6.40 higher per week than the national minimum wage); and 
• all WA State award rates will increase by 4.65%. 

In the WA private sector this change generally applies to the employees of employers who are not incorporated, such as sole traders and partnerships of individuals.

Changes to unfair dismissal protection thresholds

The high-income threshold for the purposes of the Fair Work Act has, from 1 July 2022, increased from $158,500 to $162,000.

The threshold is relevant for the purposes of:

• protection from unfair dismissal – a federally regulated employee, not covered by an award or statutory workplace agreement, does not have access to the federal unfair dismissal jurisdiction if their annual rate of earnings exceeds the high-income threshold (s.382 of the Fair Work Act); 
• maximum compensation from an unfair dismissal claim - the maximum compensation which might be awarded by the Fair Work Commission for a successful unfair dismissal claim will increase to $81,000 (i.e., half the new high-income threshold and up from $79,250) - s.392(5) of the Fair Work Act; and
• considering whether a modern award applies to an employee - a modern award, that would otherwise apply to an employee, does not apply where the employee is a high- income employee with a guarantee of annual earnings (s.47 and 329 of the Fair Work Act).

WA imposes a separate “maximum salary level” for lodging unfair dismissal claims. From 1 July 2022, the level has increased from $176,900 to $181,400. The current figure may be accessed here.

Fair Work Information Statement

The Fair Work Ombudsman has now published the latest version of the Fair Work Information Statement which applies from 1 July 2022. It can be accessed here.

It is a requirement under s.125 of the Fair Work Act that a national system employer give each employee a copy of the Fair Work Information Statement before, or as soon as practicable, after the employee starts employment.

The Fair Work Information Statement informs employees about several matters including:

• leave entitlements;
• maximum hours of work;
• termination and entitlements;
• redundancy pay;
• general protections;
• agreements (including enterprise agreements and individual flexibility arrangements); and
• union powers to enter the workplace.

Failure to give the Fair Work Information Statement, or the current version of it, is a breach of the National Employment Standards and the Fair Work Act, attracting liability to a civil penalty.

Casual Employment Information Statement

The latest version of the Fair Work Ombudsman’s Casual Employment Information Statement can be accessed here.

It is a requirement under s.125B of the Fair Work Act that employers give casual employees, in addition to the Fair Work Information Statement, a copy of the Casual Employment Information Statement before, or as soon as practicable, after the employee commences employment.

The Casual Employment Information Statement informs employees about several matters including:

• the definition of a casual employee;
• when an employer must offer casual conversion;
• when an employer is not obligated to offer casual conversion;
• when an employee can request casual conversion; and
• resolving disputes about casual conversion.

Failure to give the Casual Employment Information Statement, or the current version of it, is a breach of the National Employment Standards and the Fair Work Act, attracting liability to a civil penalty.

Civil penalties

The maximum civil penalties applicable to breaches of civil penalty provisions of the Fair Work Act, have remained unchanged since the 2019/2020 financial year. As at 1 July 2022, the maximum penalties are:

• for corporate contravenors – $66,600; and
• for individual contravenors – $13,320.

Civil penalty provisions within the Fair Work Act include those relating to:

• compliance with the National Employment Standards, modern awards and enterprise agreements;
• protection of workplace rights and other employee protections;
• rights of entry, and
• industrial action.

These penalties only affect contraventions that occur on or after 1 July 2020. Prior contraventions will attract the penalties applicable when they occurred.

Key tax rate and threshold changes

The key tax rate and threshold changes for the 2022/23 income year are summarised in the following table:

For more information about the changes to be introduced, please contact HopgoodGanim Lawyer’s Workplace & Employment Law and Taxation teams.