The Fair Work Commission announced a 4.75% minimum wage increase for approximately 2.8 million Australian workers on award wages, effective 1 July 2024. Approximately 100,000 of the nation’s lowest-paid workers will receive a steeper 6% increase as part of the decision.
The lowest ongoing minimum wage rate in Australia will rise from $24.95 per hour to $26.44 per hour under the new determination. Fair Work Commission President Justice Adam Hatcher said the 2024 minimum wage decision was "particularly challenging" due to surging fuel prices and existing inflationary pressures.
Hatcher stated that falling living standards have affected the lowest-paid workers the hardest, justifying "additional measures" to protect more vulnerable employees. The 6% increase for the lowest-paid workers reflects a "structural adjustment" to pay classifications, he added.
Inflation was 4.2% in the year to April according to the Australian Bureau of Statistics. The federal budget projected that consumer price inflation could exceed 5% if the Middle East conflict continues and oil prices remain elevated. Unions had demanded a 6% minimum wage increase following that budget forecast.
The Australian Chamber of Commerce and Industry had advocated for a more modest 3.5% increase. Treasurer Jim Chalmers called for a "real" wage increase that is also "sustainable."
The Fair Work Commission’s annual wage review determines minimum pay rates for workers covered by modern awards. Award-reliant workers include those in hospitality, retail, cleaning, and aged care sectors. The 4.75% increase applies to most award-dependent employees, while the higher 6% rate targets those earning the lowest award classifications.
The Commission considered submissions from unions, employer groups, and government bodies before reaching its decision. The panel noted that real wages have declined over the past two years due to high inflation, which has outpaced previous wage increases.