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Increasing Your Employees’ Pay: What You Need to Know

Increasing Your Employees’ Pay: What You Need to Know

Thinking of increasing your employee's pay? Read our guide to learn how to go about it and the things you should consider first.

13th April 2016
Reading Time: 2 minutes

Benefits of Increasing your Employees Pay

Increasing your employee’s pay will benefit not only your employee but can also have a number of positive effects on your business. Studies have shown that increased pay boosts employee morale and improves workers productivity. For example, US supermarket giant Costco has been shown to spend 40% more on employee wages than other competitors such as Wal-Mart, but manage to excel in annual turnovers.

Helping employees manage financial stress goes a long way in improving their workplace satisfaction and as a result their overall performance at work. After all, how can you expect them to be happy at work if they are struggling to make their ends meet? In addition, happy employees are more likely to stay around for the long term which means less costs in employee turnovers and training.

Pay them Correctly

As an employer, it is your responsibility to pay your employees correctly. This includes paying them at the correct rate with the appropriate entitlements. The Fair Work Ombudsman (FWO) has created online tools that you can utilise, such as a Pay Calculator, to help you evaluate the correct payments.

Calculating employee remuneration can at times be confusing. LawPath can organise a fixed-price quote to speak with an expert employment lawyer to help you navigate through these complexities.

Things to Keep Track of

Minimum Wage

The minimum wage in Australia changes annually, and it is your responsibility to ensure that your employees pay rates are above the threshold. As of 1 July 2015, The Fair Work Commission has increased the minimum wage for employees over 21 years of age by 2.5% to $656.90 per week or $17.29 per hour for full or part time workers, and $21.61 an hour for casual workers. This of course varies depending on an employee’s age, experience and position in your business.

The Fair Work Ombudsman offers an email subscription service that updates you on any changes applicable to you and your business.

National Employment Standards

The National Employment Standards (NES) sets out 10 minimum employment entitlements that have to be provided to all employees. These standards cannot be excluded by any other employment agreements.

The NES entitlements are:

  1. Maximum weekly hours
  2. Request for flexible working arrangements
  3. Parental leave and related entitlements
  4. Annual leave
  5. Personal carer’s leave and compassionate leave
  6. Community service leave
  7. Public holidays
  8. Long service leave
  9. Notice of termination and redundancy pay
  10. Fair Work Information Statement


In Australia, entitlements such as working conditions and minimum wages are set out in awards, which apply in conjunction to the National Employment Standards (NES). Awards depend on the industry an employee works in, and the specific job they do in that business. There are 122 industry and occupation awards, and they cover most workers in Australia. It is your responsibility to ensure that you keep up with any changes in industry awards, to ensure that your employees are receiving the appropriate entitlements.

Read more about Modern Awards.

Unsure where to start? Contact a LawPath consultant on 1800LAWPATH to learn more about customising legal documents, obtaining a fixed-fee quote from our network of 600+ expert lawyers or to get answers to your legal questions.

Jackie Olling

Jackie is the Content Manager at Lawpath and manages the content team. She has a Law/Arts (Politics) degree from Macquarie University and is a solicitor in NSW. She's interested in how technology can help shape the future legal landscape.