July 1, 2024

HR changes for the new financial year: 7 changes you need to know

A new financial year always means new changes to Human Resources.

We explore seven key HR changes likely to impact your workplace.

1. Tax cuts

The amount of PAYG you need to deduct from employees’ pay has just fallen. That’s because, on 1 July 2024, the government’s Phase 2 tax cuts came into effect.

The changes include:

  • Reducing the 19% threshold to 16%
  • Reducing the 32.5% tax threshold to 30%
  • Increasing the 37% threshold from $120,000 to $135,000
  • Increasing the 45% threshold from $180,000 to $190,000.

The tax cuts will put up to $4,529 into every employees’ paypacket – something that will come as a welcome relief to many, given the rising cost of living.

Employers will need to make sure they’re taking the correct amount out of employees’ pay.

2. Super changes (again)

At the same time as you take less tax out of employees’ pay, you’ll need to contribute more super on their behalf. That’s because the Superannuation Guarantee Contribution (SGC) went up again at the start of this financial year – this time to 11.5%.

The SGC rate has risen rapidly in recent years, going up 0.5% in 2022, 2023 and 2024. Next year, it will go up one final time before it settles at 12% in FY2026, which is ultimately where the government wants it to be.

Other changes to super include:

  • The contribution base increases to $65,070 a quarter. This effectively means once someone’s salary hits $260,280 a year you no longer have to make super contributions on that portion of their salary over the contribution base.
  • The SGC is also now part of the National Employment Standards (although this happened back on 1 January 2024). That means employees can take legal action against employers who don’t meet the minimum SGC.

3. A new minimum wage

From 1 July 2024, the National Minimum Wage increased to $24.10 an hour, or $915.90 based on a 38 hour week. This base rate applies to all employees not covered by an Award or Enterprise Agreement.

The base rate is also used to calculate special rates based on type of employment, age (i.e. employees under 21) and work capacity.  These include:

Wage typeWho applies toAmount or rate
Casual loadingCasual employees25% on top of the National Minimum Wage
Special National Minimum Wage 1Adult employees with a disability that does not affect their productivity.Same as National Minimum Wage
Special National Minimum Wage 2Employees:

–       with a disability impacting the level of productivity needed for their class of work

–       who meet the impairment criteria for a Disability Support Pension.

A percentage of the National Minimum Wage based on capacity
Special National Minimum Wage 3Employees under 21A percentage of the National Minimum Wage based on age
Special National Minimum Wage 4ApprenticesA rate based on clause 15 of the Miscellaneous Award 2020
Special National Minimum Wage 5TraineesA rate based on Schedule E of the Miscellaneous Award 2020

4. Unfair dismissal threshold raised again

High-income earners don’t have access to our federal unfair dismissal laws and can’t bring a claim in the Fair Work Commission.

The cap for what constitutes a high-income earner has been raised again, this time from $167,500 to $175,000. However, an employee who exceeds this threshold can still access the Fair Work Act’s general protection provisions.

5. The right to disconnect becomes law

From 26 August 2024, all non-small business employers will be bound by new provisions allowing employees to disconnect from work outside their usual work hours. The same provisions come into effect for small-business employers the same time next year. These changes were part of the government’s Closing Loopholes legislation.

You can read more about the right to disconnect here.

6. Changes to the Government’s Paid Parental Leave payments

On 1 July 2024, Parental Leave Pay for eligible birth and non-birth parents increases from 100 days (20 weeks) to 110 days (22 weeks). For more information about the Paid Parental Leave Scheme changes, go to the Services Australia website.

7. Closing Loopholes provisions

Finally, several other provisions from the federal government’s Closing Loopholes legislation also come into effect this financial year.

As of 1 July, all Modern Awards must include terms governing delegates’ rights to enter a workplace for alleged underpayment. Similar provisions will be needed in new workplace determinations and enterprise agreements.

On 26 August, new provisions regarding the definitions of employee and casual also become law, as well as provisions that govern independent contractors’ ‘unfair contracts’ disputes.

Again, breaching these provisions can lead to serious exposure and loss of reputation, so, if you’re ever in doubt, make sure you get advice.

Are you FY25 ready?

As FY25 begins, there are plenty of HR-related changes that businesses need to be on top of.

If you have any questions regarding the changes or are keen to find out how they could impact you or your business, speak with one of the Catalina Consultant team members today.

say hi to our author

Merilyn founded Catalina Consultants in 2012 on the belief that all organisations, regardless of size, should have access to top quality bespoke HR services. She enjoys working closely with her clients and believes that the best results are built on relationships of rapport, trust and authenticity. Growing up, Merilyn had her sight set on stardom and dreamed of becoming an actor. She also sang and played the piano, but ended up studying accounting and HR. Whilst she hasn’t won her Grammy just yet, she still loves a good karaoke night. Merilyn loves to travel with her family, with South Africa being one of her most memorable destinations.

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