In June, the Fair Work Commission (FWC) made its minimum wage decision for 2023.

A summary of the key wage increases that will apply from 1 July 2023 is as follows:

  • the minimum modern award wage rates of pay will increase by 5.75%;
  • the national minimum hourly rate will be $23.23, an increase of $1.85 per hour; and
  • the national minimum weekly wage will be $882.80 per week, an increase of $70.20 per week. 

Together with the increase in wages, the superannuation guarantee rate increased from 10.5% to 11% from 1 July 2023.

Moving forward, there is likely to be a significant impact on the hospitality and retail industries as they heavily rely on award-based workers at a time when the cost of business is rising across the board. In light of these most recent increases, business operators may need to make changes to ensure labour resources are being used as efficiently as possible.

An obvious way for many business operators to deal with increased labour costs is to reduce working hours, particularly for casual workers who do not have permanent hours of work.

Another option to manage increased labour costs relates to the method by which the workforce is utilised, specifically paying close attention to key award provisions, such as to minimise the payment of overtime and penalty rates. 

More extreme options include a reduction of workers through a redundancy program, which has become more common as the impact of the rising cost of business is felt.

Business operators may be able to achieve cost savings through any of the above options. However, in some cases, they may also present challenges in terms of the delivery of their offerings to customers and/or the retention of desired workers in a highly competitive labour environment.

Running a business is not for the faint-hearted. However, business owners are now facing unprecedented times with the increased cost of living, high interest rates and rising wage costs. 

We encourage all business owners to be abreast of their business’ financial hygiene. If your business is showing signs of financial problems, such as:

  • you consistently have insufficient cashflow;
  • you are experiencing falling sales;
  • you cannot pay employee wages and other entitlements;
  • you are paying creditors outside usual trading terms;
  • you are not lodging or paying your tax; or
  • you are receiving demands from creditors,

then we encourage you to be proactive in seeking advice to determine whether your business is viable and, if so, what steps are available to revive and keep your business afloat. 

If you wish to discuss the options available to help safeguard your business, please feel free to reach out to us.

This communication provides general information which is current as at the time of production. The information contained in this communication does not constitute advice and should not be relied upon as such. Professional advice should be sought prior to any action being taken in reliance on any of the information. Should you wish to discuss any matter raised in this article, or what it means for you, your business or your clients' businesses, please feel free to contact us.

For more information, please contact...

Helene Chryssidis

View Profile →

Jonathan Ikonomopoulos

View Profile →

Related Articles

View All News
November 28, 2023 Payroll Tax and Medical Practices: An Update and Warning to Others
Tax Health & Aged Care Employment, Workplace Relations & Safety
September 15, 2023 Payroll Tax and Medical Practices
Tax Employment, Workplace Relations & Safety Health & Aged Care
September 11, 2023 Taking Reasonable Care to Ensure Your Acts or Omissions Don’t Land You in Court
Employment, Workplace Relations & Safety
September 06, 2023 Hospitality and Retail Brace for Impact
Hospitality Employment, Workplace Relations & Safety
August 02, 2023 Increase in Minimum Award Rates of Pay
Employment, Workplace Relations & Safety
July 05, 2023 Collaborating With Robots in the Workplace
Employment, Workplace Relations & Safety
June 08, 2023 Landmark Decision: Fair Work Commission Implements Historic Minimum Wage Hike
Employment, Workplace Relations & Safety
June 05, 2023 From Fixed Term to Permanent
Employment, Workplace Relations & Safety
May 01, 2023 Countdown to the End of Zombie Agreements: Is Your Business Compliant?
Employment, Workplace Relations & Safety
November 03, 2022 Pivot in Enforcement Strategy to Create Safer Workplaces
Employment, Workplace Relations & Safety
July 12, 2022 Personal and Confidential Information: Employer Obligations to Employees
Employment, Workplace Relations & Safety Intellectual Property (IP)
June 24, 2022 Federal Labor Government to Regulate to Achieve Its Aim of Job Security
Employment, Workplace Relations & Safety
June 17, 2022 Fair Work Minimum Wage Review Significantly Increases Minimum Wage Rates
Employment, Workplace Relations & Safety
May 11, 2022 Health Sector: Preparing for the End of State-Imposed COVID-19 Vaccination Mandates
Employment, Workplace Relations & Safety Health & Aged Care
March 25, 2022 SA Labor to Apply Criminal Law to Workplaces Under its Industrial Relations Policy
Employment, Workplace Relations & Safety Agribusiness Defence + 7
March 04, 2022 Why We Should Avoid the Use of the Word “Mandate” When Communicating Vaccination Requirements to Workers and the Wider Community
Employment, Workplace Relations & Safety Health & Aged Care Agribusiness + 3
January 14, 2022 Learning to Live With COVID-19 - The Trolley Dilemma in Our Economy
Employment, Workplace Relations & Safety Workers Compensation & Self Insurance Agribusiness + 3
December 22, 2021 Religious Objections to Compulsory Vaccination for COVID-19
Employment, Workplace Relations & Safety
December 09, 2021 Aged Care: Staying Ahead of the Curve
Employment, Workplace Relations & Safety Health & Aged Care
November 18, 2021 COVID-19 Guidelines: No Jab, No Office Christmas Party?
Employment, Workplace Relations & Safety