The end of financial year is a busy time for any business, so it is easy to overlook some of the critical compliance elements that are introduced or change over this frantic period. As FY23 wraps up and FY24 commences there are changes to the superannuation rate that businesses need to address as well as changes to hours restrictions for Visa holders that will have a real impact on operations at a site level. Woven into this, there also needs to be a communication with staff about the impact these changes will have on their employment from a practical perspective.
Superannuation changes
As outlined in the Superannuation Guarantee (Administration) Act 1992 (Cth) and brought into effect with the 2021 Budget, superannuation guarantee (SG) rate increased from 9.5% to 10% from 1 July 2021, then increased a further 0.5% to 10.5% from 1 July 2022.
From 1 July 2023 the Superannuation Guarantee Rate will be increased again to 11%.
As per the Act the Superannuation Guarantee rate is now in the incremental increase stage and as such will increase 0.5% per year for another two years with the increases are currently set to cease when the superannuation rate reaches 12% on 1 July 2025.
Where staff are employed on a ‘salary plus super’ basis the change is a simple one to make, the business just has to go into the payroll system and change the superannuation % from 10.5% to 11% and communicate to the employee the change (this can be done as a separate letter or as part of the annual Confirmation of Employment process).
Visa hours changes
From 1 July 2023 student visa holders will be limited to working no more than 48 hours in a fortnight.
The cap on students’ visa holders working has been one that has caused protest and anguish from the students themselves with the argument being made that 48 hours is not enough to make facing the current spiralling cost of living, and that the prolonged removal of the cap to hours through Covid has proven that students can manage both work and their studies.
Despite this opposition the cap is set to return from 1 July 2023, albeit at the higher 48 hours per fortnight not the previous 40 hours.
“The penalties for breaches to the cap apply to the business and to the employee. They are severe and for the business are proposed to increase further. Penalties can be applied even if the business is unaware of the breaches, because for example, the employee is working 47h with this business but another 30h with another business for ‘cash’”, explains ACAPMA’s Elisha Radwanowski.
“Anecdotally members are telling us that they are hearing from their own staff that there are businesses out there that are offering students ‘cash off book’ positions, and that they are rejecting hours with this business because they feel they have to prioritise their ‘cash’ job because it can offer them more hours”, continues Elisha.
“This situation is wrong and it is illegal. Unfortunately, with the pending return of the cap it is likely to increase, as is the distortion to competition that comes from such practices, all while available labour contracts further”, added Elisha.
Student visa holders who were already working in aged care on 9 May 2023 will be exempt from the cap until 31 December 2023.
“With the cap returning Members are advised to ensure that they are communicating with their staff on the restrictions and their responsibilities, particularly around declaring all work done at other businesses. This is a vital part of the process to ensure that the business does not end up penalised if the employee decides to breach their hours by working at another business without this employer’s knowledge”, explains Elisha.
“As part of the 2023/2024 Guide Pack, ACAPMA will circulate to all members the Visa Restrictions Guide which includes the template declaration and review forms for visa restricted staff, which we really recommend members reissue to staff”, concludes Elisha.
New wage rates
The release of the National Wage Case (https://acapmag.com.au/2023/06/national-wage-case-2023-implications/) will have a direct impact on the Award Rates for all employees. For Agreement covered employees there is a need to review the Agreement Rates and ensure they are ‘keeping pace’ with the Award that they are tied to.
The new wage rates will apply from the first full pay period on or after 1 July 2023.
“This means the first pay period that does not include a single day in June. So, if for example you run a weekly payroll from Thursday to Wednesday, then this year the current rates will apply for the Pay Period of 29/6/2023-5/7/2023 and the new rates will apply for the Pay Period from 6/7/2023-12/7/2023. Even though the Pay Period of 29/6/2023-5/7/2023 has most of its days in July it is not a full pay period after 1 July, so the old rates apply”, explains Elisha.
The rates are not finalised yet (but will be by 19 or 20 June 2023 – https://acapmag.com.au/2023/06/wage-rate-2023-2024-update/), but when they are the business should circulate the details to all current staff, through a Confirmation of Employment process as well as ensuring that both offer templates and payroll systems are updated.
“Once the final determinations are released, which is expected on the 19th or 20th of June, ACAPMA will circulate the Wage Guides along with the full 2023/2024 Guide Pack to Members”, explains Elisha.
“This pack includes a Confirmation of Employment template that we recommend is provided to all current staff each year at this time, to ensure the business is meeting the requirement to communicate employment instrument, status and classification, as well as operational understandings. With the sometimes high turnover in parts of the industry it can happen that occasionally the documentation lags behind the verbal agreements, so this process of confirmation is valuable to closing any such oversight gaps at a sensible point in time”.
Can I get some help?
As always, ACAPMA Members can gain access to further information or assistance with this or any other employment issue via employment@acapma.com.au.
ACAPMA members are reminded that the ACAPMA Employment Professionals are available to assist with employment, safety and training compliance. For more information email employment@acapma.com.au
HR Highlights are things to consider, implement and watch out for in your business. They are provided as general advice and you should seek further advice on your situation by emailing employment@acapma.com.au, it’s free for members. ACAPMA membership is affordable at only $810 per year for a single site and valuable with sites gaining HR and IR advice support and representation as well as a raft of other benefits and discounts.
Elisha Radwanowski BCom (HRM & IR)
ACAPMA
Source: https://acapmag.com.au/2023/06/super-visas-new-rates-and-getting-ready-for-the-new-financial-year/.
