Effective from 1 July 2023, changes to various rates, thresholds and limits governing employment requirements are in place in Australia, with implications for employers and employees alike. From high-income thresholds to the superannuation guarantee, learn more about the changes and how they influence conditions of employment, superannuation contributions, and redundancy payments.
High income threshold
New threshold: $167,500 p/a
The high income threshold can alter conditions of employment governed by a modern award. High-income employees above the threshold are also generally unable to claim unfair dismissal. The high-income threshold will also be relevant to the new fixed-term contract restrictions that commence in December. Learn more
Unfair dismissal compensation cap
New limit: $83,750
The unfair dismissal compensation limit specifies the maximum compensation available to an employee who has been unfairly dismissed. It is typically the lesser of half of the high-income threshold or 26 weeks' pay. Learn more
Maximum civil penalty for a corporation under Fair Work Act
New limit: $93,900 and $939,000 for "serious contraventions" (for entities).
(Based on indexation of Commonwealth penalty units from $275 to $313 per unit, from 1 July 2023)
There are higher fines for "serious contraventions" of the Fair Work Act, such as underpayment breaches that are knowingly undertaken, and are part of a systematic pattern of conduct.
National Minimum Wage
New threshold: $882.80 per week or $23.23 per hour
The national minimum wage sets out the minimum wage for employees who aren’t covered by an award or registered agreement. Employers should also consider the terms of modern awards, which specify minimum terms and conditions for certain industries and occupations, or applicable enterprise agreements.
Limit for tax-free component of genuine redundancy payments
New limit: $11,985 + ($5,994 x complete years of service)
Genuine redundancy payments refer to payments received by an employee who is dismissed because the job they were doing is redundant. This means the employee's position is no longer required to be performed by anyone, and this is not due to the ordinary and customary turnover of labour. The tax-free limit for a genuine redundancy payment is calculated using a base limit and a service-related component. Any amount over the tax-free limit is called an "employment termination payment" (ETP) and may be subject to different tax rules. Learn more
Superannuation guarantee
New rate: 11.0% p/a from 1 July 2023
The superannuation guarantee (SG) specifies compulsory superannuation contributions made by Australian employers on behalf of employees. The SG is set to increase 0.5% annually up to 12% in 2025-26. Learn more
Maximum superannuation contribution base
New limit: $62,270 (per quarter)
The maximum superannuation contribution base is a limit on the contribution an employer is required to make on behalf of an employee under the superannuation guarantee (SG) scheme in Australia. Where an employee earns more than the maximum superannuation contribution base in a quarter, the employer is not obliged to make superannuation contributions on the excess. Learn more
Concessional superannuation cap
New limit: $27,500 (per annum)
Concessional superannuation contributions are payments that are made into an employee's super fund before tax. They are called "concessional" contributions because these contributions are taxed at a concessional rate of 15%, which is often lower than the rate paid if the money was taxed as income outside super. Concessional contributions have a cap, which is subject to change annually. Learn more
For more information about these changes and how they impact you or your organisation, please contact a member of Lander & Rogers' workplace relations and safety team.
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