2022 changes to Australian workplace relations laws
When you employ staff in Australia, you must take steps to comply with the latest workplace relations laws. In 2022, some of these regulations have changed. Here’s what you need to know about the latest updates if you employ people in this country. Workplace relations law in Australia Australian workplace relations laws are in place to protect the rights of Australian employees. They fall under three main categories: – Legislation – Industrial instruments – Common law Many laws protecting Australian employees also fall under the Fair Work Act 2009, which covers the majority of workers in Australia and protects their minimum terms and conditions. It is important to be aware that the Fair Work Act does not cover every industry. What’s more, some requirements differ from state to state. Recent changes to Australian workplace relations laws As of 2022, any company that employs Australian workers must be aware of several significant changes to Australian workplace relations laws. Vaccination policy Less a change and more a confirmation, The Fair Work Commission recently concluded a case that confirmed mandated vaccination policies are not unlawful. Based on the outcome of this case, an employer is entitled to implement a mandatory vaccination policy, even if there are no standing public health warnings. While the case was specific to the Australian Submarine Corporation (ASC), the ruling will most likely be held as a precedent should other cases arise. If your workplace is considering imposing a mandatory vaccination policy, it is worth noting the following conditions of the recent ruling: – Employees must be given time to either comply with the mandate or to decide to take other action. – The ASC is expected to review the policy after 12 months as the impact of the pandemic is rapidly changing – The ASC also must consult on mandatory booster requirements before making them mandatory. Mandatory vaccination is an evolving area of workplace relations right now. Check in with your ANZPEO for the latest information if you are considering a policy change. Domestic violence leave Another update to Australian workplace relations laws that is on the way is the implementation of domestic violence leave. The new Labor government intends to add ten days of extra leave for sufferers of domestic violence. A late addition to the plan also allows leave for casual workers who suffer domestic violence. This leave is intended to create a safety net for victims of domestic and family violence. Knowing they have the leave means they can take time off to escape their dangerous circumstances without fearing losing their jobs. Return to Work Laws In South Australia recently, return to work laws regarding injury claims have been given a shake-up. Previously, each injury was assessed and given a percentage rating, with 5% or more being the lowest threshold for a lump payment and 30% or more being labelled as a serious injury. Now workers can combine multiple injuries to create a sum percentage. So, an ankle injury of 3% and a shoulder injury of 29% will generate a total of 32%. Workers who meet the criteria for serious injury may be entitled to help with their medical expenses and weekly income maintenance. Workers with less than 30% may only be entitled to a lump sum payment. Minimum wage As of July 1st 2022, the Fair Work Commission has implemented a 5.2% increase in the National Minimum Wage. They have also increased modern award minimum wages so wages under $869.60 will attract an increase of $40 a week, and wages above $869.60 will increase by 4.6%. The high-income threshold The high income threshold restricts an employee’s access to an unfair dismissal claim (unless they are covered by an enterprise agreement/award). Until July 1st 2022, the high-income threshold was $158,500 per annum, but it has now risen to $162,000 per annum. The compensation limit for unfair dismissal has also increased as of July 1st, now coming in at $81,000. Superannuation This year also sees a rise in the minimum superannuation guarantee from 10% to 10.5%. The superannuation contribution base has also increased to $240,880 per annum, and there is no longer a minimum threshold except for persons under 18 years of age who are required to work at least 30 hours a week to obtain contributions. Need to know more about Australian workplace relations laws? Contact ANZPEO today.
The 2022 Federal Budget and employment in Australia
Employment in Australia and the 2022 Federal Budget. Australia’s employment laws evolve regularly and this year has been no exception. The latest Federal Budget was released on 29 March and as always, there’s a lot to digest. We’ve summarised the key changes relating to employment, tax and superannuation payments in Australia that have come about as a result of the budget. Superannuation changes By law, Australian employers must pay superannuation to their staff. This money is deposited into a ‘super’ fund on behalf of each worker, to be accessed after they retire. Superannuation helps to ensure people are financially comfortable in the future and there are penalties for failing to pay it correctly. Over the next few years, the amount of money employers must pay is set to increase in increments. Super Guarantee Rate Change – From 1 July 2022, the amount of superannuation that business owners need to contribute for their staff will increase from 10% of salary and wages paid to 10.5% of salary and wages. – This means if your employment agreements are written as wages + super, you will be increasing your overall employee costs by an extra 0.5% for the year. – The super rate will continue to increase by 0.5% every year until it hits 12% in 2026. In Australia, superannuation must be paid to employees’ super accounts every quarter. The cost applies to ‘ordinary time earnings’ (OTE) or salary. If you are an overseas company that employs people in Australia, you are not exempt from paying superannuation. Work with a reliable PEO to ensure this money is distributed accurately and on time. Removal of the $450 threshold amount for super contributions Until this year, if an employee has earned less than $450 per month, their employer has not been required to contribute to their superannuation. This changes from 1 July 2022. From that date, everyone over 18 will be paid super on every dollar they earn. If you have a number of casual workers who only earn a couple of hundred dollars per month, be aware that this update to regulations will add to the cost of employment in Australia. One-off cost of living tax offset From 1 July 2022, individuals who earn under $126,000 may receive a once-off $420 cost of living tax offset that is paid through their 2021-22 tax return. This once-off offset is combined with the Low and Middle Income Tax Offset (LMITO), meaning eligible low and middle-income earners will receive up to $1,500 for a single income (or up to $3,000 for a couple) for the 2021-22 income year. This Cost of Living Tax Offset has been clearly labelled as a once-off, and the LMITO is set to end this year. As shared by Australia’s ABC News, the money will be distributed when people file their tax returns. As an employer, you don’t have to take action to ensure they receive the funds. However, it’s worth noting that this bonus is coming to an end. It may see some people interested in receiving benefits instead of money, so they can reduce the tax they pay. This will depend on the individual but your PEO can help you negotiate packages to help minimise tax for your employees if their salary is pushing them into a higher earning threshold. Skills and training Upskilling employees is a priority in Australia due to the limited number of skilled workers. If you are focused on creating employment in Australia, offering training can help attract quality candidates and reduce turnover. The 2022 Federal Budget announced access to a 20% deduction for the cost of external training courses delivered to employees by providers registered in Australia for small businesses with an annual turnover of less than $50 million. Take note of the following if you’re considering training courses for your staff: – This boost will apply to eligible expenditures incurred from Budget night until 30 June 2024. – For eligible expenditure incurred by 30 June 2022, the boost will be claimed in tax returns for the following income year. – For eligible expenditure incurred between 1 July 2022 and 30 June 2023, the boost will be claimed in the income year the expenditure was incurred. As a business that employs people in Australia, the 2022 superannuation changes are likely to have the biggest impact on your bottom line. As mentioned, you may wish to negotiate perks such as allowing staff to salary sacrifice their vehicle lease or issuing rebates for health insurance/gym costs. This has the potential for your business to reduce wages and pay less super, while still giving people plenty of reasons to work for you. Contact ANZPEO to find out more about the superannuation and tax requirements of employing local workers in 2022 and beyond.