The 2023 State Wage Case
The Western Australian Industrial Relations Commission has increased the State Minimum Wage by 5.3%, which brings the State Minimum Wage to $863.40 per week from 1 July 2023. The Commission also increased award rates by 5.3% from that time.
The increases apply only to employees who are paid the minimum wage or award rates in the State industrial relations system. Approximately 27,000 employers and more than 300,000 employees are estimated to be affected by the decision.
In making its decision, the Commission is required to consider a broad range of economic and labour market factors, and social and equity considerations.
The Commission noted that both last year and this year, the focus has been on cost of living pressures given the high inflationary environment and rising interest rates in tandem with a continuing tight labour market. On this occasion, whilst inflation remains elevated, the available evidence suggests it will moderate in the year ahead. A balance must be struck having regard to the overall economic environment and relevant social and industrial factors.
While the State economy remains sound, current data and the forecasts for the year ahead, are pointing to a slowdown in domestic growth, increasing downward pressure on household spending, with an uptick in unemployment, albeit from a 15-year low.
The decrease in household spending as consumers tighten their belts further in response to high interest rates and prices, evidenced most recently by the RBA’s latest cash rate increase and moderating retail spending, will likely have an impact on those businesses most prevalent in the State system. The decline in overall aggregate business profitability, from 26.4% considered in last year’s proceedings to 8.8% in this year’s case, was also a relevant consideration.
In making its decision, the Commission is required to consider the need to —
- ensure that Western Australians have a system of fair wages and conditions of employment; and
- meet the needs of the low paid; and
- provide fair wage standards in the context of living standards generally prevailing in the community; and
- contribute to improved living standards for employees; and
- protect employees who may be unable to reach an industrial agreement; and
- encourage ongoing skills development.
It is also required to consider:
- the state of the economy of Western Australia and the likely effect of its decision on that economy and, in particular, on the level of employment, inflation and productivity in Western Australia; and
- to the extent that it is relevant, the state of the national economy; and
- to the extent that it is relevant, the capacity of employers as a whole to bear the costs of increased wages, salaries, allowances and other remuneration; and
- the need to ensure that the Western Australian award framework represents a system of fair wages and conditions of employment; and
- relevant decisions of other industrial courts and tribunals; and
- any other relevant matters.
People interested in making a submission are invited to address those issues.
Who is covered by the 2023 State Wage Case General Order?
The General Order will apply to those employers and employees covered by the WA industrial relations system. To find out if you are covered by the state system, or for further information on your employment conditions, please contact Wageline on 1300 655 266.