09 Jun HR LAW NEWSLETTER – MAY 2025

Welcome to the May 2025 HR Law Newsletter.  This month, we discuss some changes that will take effect from 1 July 2025.  In addition, we discuss a recent case in which the Fair Work Commission reduced an employee’s redundancy entitlement of approximately $19,000.00 to zero for failing to accept alternative acceptable employment.

As the end of the financial year is approaching, we also encourage employers to take the opportunity to review their employment practices to ensure they align with current legislative requirements.  Details of our Workplace HR Audit offer can be found below. 

MINIMUM WAGE INCREASE FROM 1 JULY 2025

The Full Bench of the Fair Work Commission has recently announced a 3.5% increase to the National Minimum Wage and minimum modern award wages.  This increase surpasses CPI, an occurrence we have not seen in several years.

This means that the National Minimum Wage will increase from $24.10 to $24.95 per hour.

The increases will take effect from the first pay cycle on or after 1 July 2025.

With these increases fast approaching, we recommend that employers undertake a payroll assessment to ascertain whether any employee’s rates of pay are required to be updated following 1 July 2025, particularly where employers pay minimum award wages.

To read the Fair Work Commission’s decision, click here.

SUPERANNUATION: INCREASE TO 12 PERCENT FROM 1 JULY 2025

Also taking effect from 1 July 2025 is an increase in the employer compulsory superannuation contributions which will rise from 11.50% to 12.00%.  No further increases are currently legislated.

Employers need to consider the effect this will have on employees whose remuneration is inclusive or exclusive of superannuation and any amendments which may be required to the terms of their employment.  For example, if an employee’s remuneration is inclusive of superannuation and it is intended that the superannuation increase be ‘absorbed’ within the employee’s salary, employers must ensure the employee is not underpaid as a result (i.e. taking into account for example, the employee’s minimum hourly rate, allowances, penalty and overtime rates etc. in accordance with the relevant modern award or enterprise agreement).

CASE BRIEF: FAIR WORK COMMISSION DENIES REDUNDANCY PAY

In the recent decision of Mater Misericordiae Ltd t/as Mater v Robyn Tyler [2025] FWC 1396, the Fair Work Commission has reduced an educator’s redundancy entitlement of approximately $19,000.00 to zero for refusing an alternative role that required on-site attendance.

Under section 120 of the Fair Work Act 2009 (Cth) (“FW Act”), an employer can apply to the Commission to reduce an employee’s statutory redundancy pay, where the employee is offered acceptable alternative employment.  In determining whether a role is considered acceptable, the Commission have considered various factors, including:

• rate of pay;

• hours of work;

• work location;

• seniority;

• fringe benefits;

• workload;

• job security;

• continuity of service;

• accrual of benefits;

• probationary periods;

• carer’s responsibilities; and

• family circumstances.

In this case, upon redundancy, Ms Tyler’s employer had offered her an alternative position with equivalent pay, hours and seniority.  However, Ms Tyler declined the offer on the basis that it did not accommodate her preferred working-from-home arrangement (one day per week) which she said was necessary to support postgraduate studies.

However, Commissioner Simpson found that:

• The role offered met the definition of “other acceptable employment” under s120(1)(b) of the FW Act, noting its objective comparability in terms of pay, hours and duties.

• Ms Tyler had no formal flexible working arrangement under section 65 of the FW Act or contractual entitlement to work remotely.

• Mater’s Remote Work Policy applied only where operationally feasible, and the flexibility previously afforded was discretionary.

The Commission ultimately reduced Ms Tyler’s redundancy entitlement to nil, applying s120(2) of the FW Act.

This decision reinforces that employers may have grounds to apply to reduce an employee’s redundancy pay, particularly where they have offered an objectively acceptable role, and where the employee has refused the role where there are no statutory or contractual grounds to do so.

To read the case, click here.

WORKPLACE HR AUDIT

As we approach the end of the financial year, now is the time to review your employment practices to ensure your business is legally compliant from an employment law perspective. 

HR Law is currently offering a Workplace HR Audit to ensure your employment practices comply with the current legal framework.  

What’s Included?

While the Workplace HR Audit can be tailored to suit your business’ needs, our Workplace HR Audit generally includes reviewing:

1. the business’ pre-employment and engagement documentation;
2. payroll/payslips generated including superannuation requirements;
3. Modern Award coverage applicable to your business;
4. the applicable legislation relevant to your business;
5. employment conditions; and
6. record keeping practises.

Your business will be provided with our report covering compliance, with action items.  If relevant, we will provide our fee estimate to assist your business with these action items to ensure your business is complying with legislation.

If you would like more information regarding our Workplace HR Audit offer, including our fee estimate tailored to your business, please contact us at info@hrlaw.com.au.

CONNECT WITH US ON LINKEDIN

If you are not already connected with us and you would like to keep up to date with topical employment law matters, please follow us on LinkedIn and subscribe to our email updates.

We also post articles regularly on our website www.hrlaw.com.au.

If you or your colleagues would like to be added to our mailing list, please email us at info@hrlaw.com.au .

The content of this newsletter is intended to provide a general guide to the subject matter.  Specialist advice should be sought about your specific circumstances.