Newsletter

1. Drayton’s Workplace Consulting 6 June 2013 Inside this Issue: Experience, knowledge, results. Newsletter Winter 2013 Welcome to the Drayton’s Winter Newsletter. This edition will outline the recent National Wage Increase for 2013 as well as latest data on wage growth. Other articles address the increases to the Superannuation Guarantee, the new Building Code, and a synopsis of the Coalition’s IR policies. National Wage Increase 2013 2.6% increase to wages The Fair Work Commission has released the decision for the annual wage review. The decision provides for a 2.6% increase to the minimum wage rates in Modern Awards. The wage review panel have outlined a number of key considerations in determining this increase such as a favourable economic outlook, moderate GDP growth forecasts for the 2013–14 financial year and the unemployment rate is expected to increase slightly. In addition to these considerations, the Superannuation Guarantee (SG) rate increase to apply from 1 July 2013 has also been a moderating factor in the adjustment to minimum wages. The increase represents a $15.80 per week increase to the minimum wage, with the new minimum wage being $622.20 per week or $16.37 per hour. The increases will commence from the first full pay period on or after 1 July 2013. WHAT DOES THIS MEAN FOR EMPLOYERS? If your employees are engaged in terms of a Modern Award, the minimum wage rates will increase by 2.6%. The increase can be absorbed into over Award payments. If your employees are engaged in terms of an Enterprise Agreement, the decision will have no impact, unless the base hourly rate in the Enterprise Agreement is less than the equivalent rate in the Modern Award. The base rate of an Enterprise Agreement in these circumstances must be adjusted to equal the Modern Award rate. If your employees are engaged in terms of an Enterprise Agreement which prescribes an increase in line with the National Wage Review, the minimum wage rates in the Agreement will increase by 2.6%. If you currently pay wage rates above the minimum rates prescribed in the Enterprise Agreement, then this increase may be absorbed by the increased rates. Should you require information regarding wage increases, please call our office for assistance on (07) 3831 7099. 1

2. Wage Growth Indicators Enterprise Agreements The table below illustrates the percentage increase in the annual average wage increase of Enterprise Agreements approved in the December 2012 quarter. The results represent a 0.5% decrease in wage growth in the private sector and construction. Latest CPI Index The annual Consumer Price Index (CPI) figures for the March Quarter 2013 have recently been released with moderate growth seen both nationally and in Queensland. Nationally, the annual CPI index for the Quarter increased by 2.5% across all groups from March 2012, up from 2.1% in the December Quarter. In Brisbane, the CPI increase was below the national average at 2.1%. Superannuation Increase As previously outlined in our Winter 2012 newsletter, the Superannuation Guarantee (SG) rate will be increased on 1 July 2013 to 9.25%. There will be further incremental increases until the 2019/2020 financial year, when the SG rate will be set at 12%. Building Code 2013 The Department of Education, Employment and Workplace Relations (DEEWR) have begun assessing Industrial Instruments (Modern Awards, Enterprise Agreements etc.) against the new Building Code 2013. This new Code replaces the requirements under the previous versions of the Code from 2006, 2009 and 2012. This new Code is applicable to building contractors and building industry participants that have tendered for, or expressed interest in, building and construction work that is funded in whole or in part by the Commonwealth, or have performed work on those projects that are within the scope of the Code. Should you require compliance against the new Code, please call our office for assistance on (07) 3831 7099. 2 2

3. Federal Election 2013 – Coalition Industrial Relations Policies • With almost 3 months to go until the September 14 Federal Election, Tony Abbott and the Coalition have outlined their key Industrial Relations policies for the upcoming election. Mr Abbott’s policies are distinctly different to the Howard Government’s WorkChoices legislation introduced in 2005. The Coalition policies in summary are as follows; • Re-establish the Australian Building and Construction Commission (ABCC) • Tighter right of entry laws • Amendments to Individual Flexibility Arrangement (IFA) • 3-month timeframe on Greenfield Agreement negotiations • Introduce greater scrutiny on registered organisations i.e. Unions and Employer bodies • Implement a review by the Productivity Commission on long term workplace laws • Introduction of a Fair Work Ombudsman hotline to assist small business • 26 weeks of paid parental leave • The Coalition’s policies are centred around the principles of increased productivity, greater flexibility and a de-regulation of the labour market. The re-introduction of the ABCC aims to curb the current power of unions by addressing union militancy and thus in a non-legislative way, through other avenues such as Codes of Practice, help minimise industrial disputes, increase productivity and create a more business friendly environment in enterprise bargaining. The restoration of right of entry laws, proposes a change that will ensure a more sensible approach to this matter. • The Coalition also proposes to remove the restriction on Individual Flexibility Arrangements (IFAs) and ensure that employees can ask for a flexible working arrangement if they choose without Enterprise Agreements restricting their use. As the Coalition intend to maintain the current Better Off Overall Test (BOOT), this will ensure that any IFAs will always lead to employees having terms of employment which are better off overall than the minimum standards. • One of the biggest proposals for the construction sector appears to be in regards to Greenfield agreements. Currently Greenfield agreements (agreements for new projects where no existing employees are engaged) must always be negotiated with a union. This currently enables unions to cause delays and/or demand inflated terms and conditions. The Coalition plans to require negotiations to be completed within three months, before which time as the Fair Work Commission is able to approve the agreement subject to the agreement containing conditions which are of an industry standard and meet the BOOT. This will ensure a more cost effective outcome for resource projects and appears to be aimed at increasing the diminishing investment, both from within Australia and overseas , in the Construction and Resources sectors. 3 3

4. Civil Construction Industry Salary Survey • The Civil Career Salary Survey is now available. Civil Career have undertaken a Salary Survey for the Queensland Civil Construction Industry. The survey provides a salary guide, regional specific uplifts, bonuses and a detailed analysis of salaried position benefits for the following positions throughout the Queensland Civil Construction Industry; • The uplifts for the following regions have been surveyed; • The survey will also provide the industry projected salary increase for 2013/2014. • What is the cost of the Salary Survey? • Survey Contributors - $400.00 plus GST • Non-Contributors - $500.00 plus GST • A 10% discount applies to CCF members • To order your copy of the Civil Career Salary Survey, contact Civil Career on admin@civilcareer.com.au or (07) 3831 7936. 4 4

5. ContactDrayton’s:Greg Power Phone: (07) 3831 7099 Fax: (07) 3831 7922 Email: admin@draytons.com.au 4 5