The national minimum wage will be $812.60 per week, or $21.38 per hour, after a decision by the commission exceeds the government's suggested 5.1 per cent increase.
Look back on how the day's events unfolded in our blog.
Key events
- Prime Minister backs the Fair Work Commission's decision
- Chamber of Commerce and Industry unhappy with the decision
- Will we end up facing another wage crisis?
- When will the pay rises come through?
- Minimum wage to increase by 5.2 per cent
- Think Tank survey finds people across parties back a big pay rise
Live updates
By Jessica Riga
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By Jessica Riga
Here's what you need to know about the minimum wage increase
Let's get you up to speed on what's been announced today, and the reactions:
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The Fair Work Commission has ruled the minimum wage should increase by 5.2 per cent
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It means the minimum wage will be lifted $1.05 an hour from its $20.33 base to $21.38 an hour
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Workers on award rates will go up 4.6 per cent — a cut in real wages — with a minimum $40 weekly increase for workers on award rates below $869.60 per week
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The change will come into place on July 1
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Prime Minister Anthony Albanese said he "absolutely" welcomed today's decision
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Sally McManus, head of the Australian Council of Trade Unions, said the FWC's decision was a victory for wage workers
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The Australian Chamber of Commerce, however, warns the decision will put businesses under more stress
You can read more on this story by political reporter Jake Evans here.
By Kelsie Iorio
Passing on increases
Will my employer automatically increase my wage or will I have to speak with them?
-James
If you're among the workers affected by today's announcement, you shouldn't have to ask for it to be passed on.
The Fair Work Commission says:
"Employers must provide their employees with at least the minimum entitlements for wages and conditions of employment. These entitlements are most often found in enterprise agreements or awards. There is a safety net to make sure all employees who are part of the national system receive the minimum wages and conditions."
ABC business reporter David Taylor makes this point on the topic:
Of course, if you're not sure or have concerns you can check in with the Fair Work Commission directly.
By Kelsie Iorio
Policy sledge at Press Club
The Australian Labor Party's National Secretary Paul Erickson is speaking at the National Press Club at the moment.
He's talking about key issues that came up at the pointy end of the election campaign — and of course, one of the biggest was wages and the cost of living.
Mr Erickson says the focus on this topic was no surprise because "Australians were facing rising interest rates, spiralling inflation and declining real wages" (and he's not holding back in his criticism of the now-Opposition).
"We campaigned consistently on the need to boost wages growth," he says.
"It was in our TV ads and we pointed out that there were plenty of things the Federal Government could do — supporting minimum wage cases, investing in TAFE and training, boosting workforce participation through cheaper child care, giving workers more job security, and investing in industries that will grow and provide employment opportunities into the future.
"The Liberals argued that Australia was already enjoying a strong recovery, but that only a returned Morrison government could secure that recovery. Yet whenever the question was the real experience of working people, the Liberals said that everything was beyond Australia's control. Anything to avoid admitting there's a role for Government, until Anthony Albanese said that he'd welcome the Fair Work Commission increasing the minimum wage to match headline inflation.
"Then the Liberals claimed that the sky would fall in. Undercutting their campaign assertions about the strength of the recovery. That wasn't just incompetent, it was incoherent."
By Shiloh Payne
Will wages go backwards despite the pay rise?
Reporter: You said workers don't deserve to go backwards, inflation will hit 7 per cent by the end of the year so they'll end up going backwards anyway.
Prime Minister Anthony Albanese: "We have a circumstance whereby we've just had a decision.
I know some in the media are pretty cynical but with due respect, we've had a decision whereby the inflation rate was 5.1 per cent, the Fair Work Commission have come down with a decision of 5.2 per cent, that is something that the former government opposed and indeed they said the sky would fall in if that occurred.
They ran around and ran a scare campaign during the federal election opposing any increase which would keep up with the inflation rate which means that they were advocating a real wage cut for people on the mimimum wage.
We put forward a plan, we made clear with our submission with the Fair Work Commission as we did during the elction campaign.
As we did every day of this year, I have spoken about the cost of living and how everything was going up except for peoples wages. Our submission to the Fair Work Commission was consistent with the mandate that we received at the election which was that people who were on that minimum wage in the current circumstance.
By Shiloh Payne
By Kelsie Iorio
What about the businesses that have to pay their workers more?
Anthony Albanese has just been asked this question after he welcomed the FWC's decision to increase the minimum wage.
"Those small businesses all rely upon their workers, who are really struggling with the cost of living. This is a dollar an hour," he says.
"Let's be clear about what this debate has been about. It's about whether people who are on the minimum wage should have a real wage cut, and I haven't had anyone who's not on the minimum wage argue that that should occur.
"These people are really struggling and that's why we opposed a real wage cut for people on the minimum wage. These are workers who keep those small businesses going, and they are workers who deserve not to go backwards.
"If you are on the minimum wage, you are also spending every dollar that you have. Every dollar you receive will go back into the economy, into circulation. It won't go into savings, it won't go into an overseas holiday, it'll go to food on the table for the kids of people on minimum wages."
By Shiloh Payne
You can watch the Prime Minister's press conference here
By Kelsie Iorio
Prime Minister backs the Fair Work Commission's decision
Unsurprisingly, Anthony Albanese says he's extremely supportive of the increase to the minimum wage (which was a key point throughout Labor's election campaign).
"When I was asked would I welcome the decision, I said absolutely. And I absolutely welcome today's decision," he says.
"It makes a difference to people who are struggling with the cost of living."
By Kelsie Iorio
Anthony Albanese is speaking now
He's talking renewable energy at the moment.
By Kelsie Iorio
On the balance beam of inflation
Political reporter Jane Norman has just checked in live from Canberra — she explains that the reason for today's pretty substantial increase is because of the spike in inflation.
"A sharp increase in inflation is how the Fair Work Commission President described it," she says.
"Just by way of comparison, this time last year, with the Fair Work Commission considering the minimum wage increase, they were contending with inflation of 1.1 per cent. Well, is now 5.1 per cent and on track to peak, according to the Reserve Bank, at 7 per cent this year so prices are soaring and today big increase to the minimum wage is seen as going some way to offset that."
She also says that because today's announcement is a bigger increase than what the new federal government was pushing for (which was a 5.1 per cent increase), it's expected the PM will be "pretty pleased with this outcome".
We'll hear directly from Anthony Albanese soon.
By Kelsie Iorio
We're expecting to hear from PM Anthony Albanese soon
He's in Gladstone today, touring a refinery and talking renewable energy — but it's highly likely he'll comment on the Fair Work Commission's wages decision too.
By Kelsie Iorio
Greens leader Adam Bandt has also weighed in
He says Australia should "establish a new minimum wage at 60% of the median wage".
By Kelsie Iorio
The cost of living is still smacking us all around
Here's some more from political reporter Jake Evans:
The newly elected Prime Minister has been under pressure to ease cost of living burdens, as inflation, rising interest rates and skyrocketing petrol and energy prices hit Australians' wallets.
The Reserve Bank is also expecting inflation will continue to rise to reach 7 per cent by Christmas, and is planning for several more interest rate hikes.
More pain is in store for Australians in September, when a temporary 22 cent cut to the fuel excise is set to end.
In an election night survey of 1,400 Australians, The Australia Institute found the vast majority of people across party lines backed an increase to the minimum wage that kept up with the cost of living — 88 per cent of surveyed Labor voters and 79 per cent of surveyed Coalition voters backed the pay packet increase.
During the election, former prime minister Scott Morrison criticised Labor for promising to push for the pay rise, saying the government should not intervene in the independent work of the Fair Work Commission — though governments of both stripes have made formal recommendations in the past.
You can read more from Jake here.
The Prime Minister is likely to comment on the decision at some stage, but we don't have any details at this stage about when that might happen. We did hear from Treasurer Jim Chalmers a little earlier; he posted a brief social media update welcoming the decision.
By Shiloh Payne
National wage case decision still ‘well below poverty line’
Chair of Catholic Social Services Australia Francis Sullivan says the wage increase is welcome but workers on low incomes will still struggle to make ends meet.
“While the commission’s decision is welcome, the struggle for low-income families to achieve a decent standard of living is still very, very hard,” Mr Sullivan says.
“Many of the working poor in Australia have barely enough to pay their rent and put food on the table.
“And with runaway inflation and cost of living increases, this is only getting worse.
Mr Sullivan said that this was still well below the poverty line in Australia, of $1,091 a week for a family of four comprising two adults, with one working and two dependent children, but it turns around a decade of minimum wages going backwards.
“In a country like Australia, every worker should be able to, at the very least, pay their bills, support their families and still have a little left over for a decent standard of living."
“The challenge for the government is now how to push the minimum wage closer to or above the poverty line for the average family.”
By Kelsie Iorio
By Kelsie Iorio
More from the Australian Chamber of Commerce and Industry
CEO Andrew McKellar said just a little while ago that the biggest challenges businesses are facing at the moment include supply chain constraints, labour shortages and energy prices.
"All of these things are adding to pressures on the supply side, they are pushing up input costs, and that is feeding through into inflation," he says.
"Any decision that comes at this point in time, at the upper end of the range of possible outcomes, will add to costs to business. As we've said, that cost will be an extra $7.9 billion hitting the bottom line of affected businesses as a result of this."
He says the decision highlights that the existing national wage case process has "had its day".
By Shiloh Payne
October increase of 4.6 per cent for some award wage earners
Here are the industries who will see a 4.6 per cent increase to their award wage from October 1:
- 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.
