Several changes to employment law are coming into effect soon.
Employers: to avoid being caught out, be aware and prepare.
Minimum Wages
- Following the Fair Work Commission’s Annual Wage Review 2025, the National Minimum Wage and the minimum wage rates prescribed by Modern Awards will be increased by 5%.
- From 1 July 2025 the National Minimum Wage will increase to $948 per week (or $24.95 per hour).
Superannuation Contributions
- The mandatory superannuation guarantee percentage rate will increase from 11.5% to 12% on 1 July 2025.
- Employers will need to ensure they are contributing 12% of an employee’s ordinary time earnings as superannuation to a compliant super fund.
- The superannuation guarantee percentage has been periodically increasing since 2021 and is now set to stay at 12%.
Parental Leave
- From 1 July 2025 the Government Paid Parental Leave period will increase from 22 to 24 weeks (120 days), paid at minimum wage rates. This period will increase again in July 2026 to 26 weeks.
- The Government will also start paying the minimum superannuation guarantee (12% from 1 July 2025) on top of the Government parental leave payments. This will be paid directly to the eligible employee’s superfund account as per normal.
Right to Disconnect
- The Right to Disconnect (see our article here) will apply to small businesses from 26 August 2025.
- From that date, employees of small businesses (with less than 15 employees) will be able to reasonably refuse to monitor, read or respond to contact from their employer (or a relevant third party) in relation to work, where it occurs outside their working hours.
Next Steps
We recommend:
- Employers ensure they (and their bookkeepers) are aware of and can implement the upcoming increases to the superannuation guarantee, the National Minimum Wage and minimum wages under Modern Awards (where relevant).
- Employers review and update their employment agreements and check they remain compliant with minimum standards.
- Employers with employees affected by the increased paid parental leave periods need to ensure they have accounted for the increased period when hiring employees to cover their absence.
- All businesses should review their employee’s ordinary hours of work and if necessary, create appropriate processes and procedures to avoid unreasonable ‘out of hours’ contact.
If you have any questions or would like assistance implementing the changes, please contact us.
