Minimum wage rise brings added strain ahead of Christmas rush

ECONOMIC UNCERTAINTY may force employers covered under 21 awards to rethink their Christmas strategy as the minimum wage increases from November 1.

Unlike most awards that saw the increase take effect on July 1, these 21 awards, which include hospitality, restaurant, fitness, and hair and beauty are the last to receive it. As of November 1, the national minimum wage for those covered under these awards is $20.33 per hour. In other words, the minimum a full-time employee receives is $772.60 per week.

“This rise, while in line with other industries, could not have come at a worse time for businesses heading into the busy end of the year, particularly those in eastern states who have just emerged from lockdown and not seen a steady profit come in for quite some time,” Employsure Business Partner Emma Dawson said.

“The rise doesn’t just mean the minimum wage goes up, but also casual loading rises along with it. For businesses in the hospitality and restaurant industries who are looking to take on more staff to help with the upcoming Christmas and summer rush, this may make them rethink how much staff they are able to hire, ultimately hurting the financial prospects of casual employees.

“Employers should educate themselves on the changes to the minimum wage, and update their payroll systems and processes accordingly to avoid the risk of underpaying employees.”

The topic of wages has dropped off the minds of employers in recent months due to lockdown. Employsure’s advice line for business owners recorded 2,100 wage related calls in September, the lowest of any month in 2021 and a 14 percent decrease compared with September last year.

In the lead up to Christmas, employers will need to ensure more than ever they’re paying their staff correctly in line with the wage rise, and it is expected the topic of wages will again become the centre of attention, alongside workplace vaccinations.

While a rise to the minimum wage may cause greater financial stress initially it does present a silver lining for employers. More money in the pockets of employees means more cash that gets funnelled back into the economy, which could ultimately lead to more being spent in the businesses who need it most.

“While wage increases are a challenge for any business to implement, it does present an opportunity to improve financial health. Being creative with cost savings and identifying new efficiencies can help a business manage when wages increase, particularly in the lead up to Christmas,” Ms Dawson said.


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