30 June 2016
Implementation of Increase to Award Pay Rates
Members are reminded that the minimum wage rates set out in Modern Awards will increase from the beginning of the first pay period commencing on or after 1 July 2016. While the minimum rates will increase by 2.4%, employers who were paying above-award wage rates are permitted to increase actual paid rates by a smaller amount, or even no increase, provided that the wage rates paid are not less than the relevant award minimum pay rate. The minimum rates specified in a relevant Modern Award also set a minimum payment level for employees to whom a Collective Agreement applies.
Updated Award Pay Rate Summaries have now been emailed out to members whose award preferences are known, and copies of the updated Awards will be sent out in the coming days.
Most employers are now set up to comply with SuperStream obligations for paying and reporting on superannuation payments for employees, meeting the 30 June deadline. However, a number of small employers are not yet SuperStream compliant. On 22 June the ATO announced that until 28 October 2016 it would exercise “compliance flexibility” for non-SuperStream contributions from small employers. This means that the ATO will not be taking compliance action against offending employers, but it would direct its efforts to bringing them on board.
While the ATO’s normal discretionary capacity applies to SuperStream breaches the ATO has no discretion with the superannuation guarantee charge, and no capacity to waive or reduce a charge. It is important that small employers which are not yet SuperStream compliant do not miss or delay payment of their contribution because of this.
The current obligation under the Superannuation Guarantee Act to avoid a superannuation guarantee charge is to pay a contribution of at least 9.5% of an eligible employee’s ordinary time earnings in a quarter within 28 days of the quarter. Where an employer contributes more frequently the contributions must total at least this amount and the final of them must be paid within 28 days of the quarter’s end. For the June quarter contributions must be made by 28 July to avoid the guarantee charge.
Employers are not obliged to make superannuation contributions on quarterly earnings above the maximum contributions base, which is indexed. For the quarter beginning 1 July 2016 the maximum contributions base increases from $50, 810 to $51, 620 per quarter. This means that the maximum quarterly contribution that an employer is obliged to make under the superannuation guarantee is $4903.90. Higher contributions may be required by an award, agreement or contract.
CBC Members can obtain further information on Workplace Relations issues and other conditions of employment by calling the Chamber’s Workplace Relations Hotline on 1300 277 881.