Minimum wage workers get a $21 per week pay rise – but the three percent raise is less than last year’s hike

  • The Fair Work Commission has increased minimum wage by $21.60 a week
  • Minimum wage in Australia was increased by three per cent to $740.80 a week
  • The increase is less than last year due to a slower economy the commission said

By AUSTRALIAN ASSOCIATED PRESS

Published: | Updated:

Australia's lowest paid workers will get a $21.60 a week pay rise.

The national minimum wage will rise by three per cent to $740.80 a week from July 1, the Fair Work Commission announced on Thursday.

Unions had been calling for a six per cent rise, about $43 a week, while business groups were banking on a more modest increase of up to two per cent.

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The national minimum wage will rise by three per cent to $740.80 a week from July 1, the Fair Work Commission said (stock image)

The national minimum wage will rise by three per cent to $740.80 a week from July 1, the Fair Work Commission said (stock image)

'We have decided to award a lower increase this year than that awarded last year,' commission president Justice Iain Ross said.

While noting a recent slowing in quarterly gross domestic product growth, the economy had been performing relatively well and employment was expanding, while inflation was subdued.

'We are satisfied that the level of increase we have decided upon will not lead to any adverse inflationary outcome and nor will it have any measurable negative impact on employment,' Justice Ross said.

'However, such an increase will mean an improvement in real wages for those employees who are reliant on the NMW and modern award minimum wages and an improvement in their living standards.'

The commission's decision directly affects 2.2 million workers. 

The increase to $740.80 a week for minimum wage earners equates to $38,521.60 a year before tax.

A full time low wage earner will be placed in to the second lowest tax bracket following the $18,200 tax-free threshold. 

The news comes after the Coalition announced in the April Budget that minimum wage earners will be receiving a tax cut of $255. 

In comparison it was also announced that those earning between $48,000 to $90,000 would receive a $1,080 tax cut.   

Unions had been calling for a six per cent rise, about $43 a week, while business groups were banking on a more modest increase of up to two per cent (stock image)

Unions had been calling for a six per cent rise, about $43 a week, while business groups were banking on a more modest increase of up to two per cent (stock image)

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