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HR Outsourcing

HR Newsletter – May 2022

CPI increase 5.1% over the 12 months – what does this mean for employee remuneration?

The all-groups Consumer Price Index (CPI) measures household inflation and includes statistics about price change for categories of household expenditure. CPI is important when determining any remuneration increases as it reflects the increased cost of living to employees.

Employers often use the CPI increase as the minimum remuneration increase to ensure that their employees are no worse off with their current salary as the CPI increases.

According to the most recent ABS update (March 2022) quarter:

  • The Consumer Price Index (CPI) rose 2.1% this quarter
  • Over the twelve months to the March 2022 quarter, CPI rose by 5.1%
Quarter CPI
June 2021 +0.8%
September 2021 +0.8%
December 2021 +1.3%
March 2021 +2.1%

In addition to considering CPI, it is recommended that employers also use both performance insights and market remuneration data to inform their remuneration increases. Liquid HR has purchased the National Salary Survey (April 2022) release which contains market remuneration data for a number of roles across different industries.

Should you require market remuneration data for your organisation, please get in touch via enquiries@liquidhr.com.au

 

Superannuation – what you need to know

From 1 July 2022 superannuation will increase to 10.5%. As previously communicated, this is part of a gradual increase until it reaches 12%.

Now is a great opportunity to ensure your contract templates and payroll processes are updated to reflect this change and to ensure you are meeting your superannuation guarantee requirements.

Have you determined:

Who is eligible for super contributions?

  • If any contractors are eligible for super contributions? (contractors engaged mainly for labour are eligible for super, even if they are engaged via an ABN)
  • If you need to apple for a certificate of coverage for employees you’re sending overseas (see here)
  • What payments are considered ordinary time earnings? (therefore eligible for super). See here

Selecting a fund. Have you:

  • Offered your employees a choice of super fund?
  • Provided your employees’ TFN to their fund of choice?
  • Understood how to pay super. Ensuring you’re paying super to a complying fund or retirement savings account (RSA). See here.
  • Requested your employees stapled super fund from the ATO if a choice of fund has not been nominated?
  • Selected your default super fund

Paying and reporting electronically. Have you:

  • Determined how much super to pay your employees? See here.
  • Complied with SuperStreem by making payments and providing data electronically?

Paying on time. Have you:

  • Checked your super payment due dates? See here
  • Paid super contributions on time?
  • Paid super contributions at least 4 times a year?

If you haven’t paid on time, have you:

  • Calculated the super guarantee charge? See here
  • Lodged the super guarantee charge statement?
  • Paid the super guarantee charge?

Record keeping. Have you kept accurate records:

  • That are written in English or can be easily accessed and converted into English? for 5 years?
  • That if electronic has software that can access older file types such as CDs?
  • Of receipts or other documents used by the fund showing you’ve made contributions for each employee?
  • That show how much super guarantee you paid for each employee and how it was calculated?
  • That show you’ve offered each eligible employee a choice of super fund?

 

Do your employees have goals?

Everyone at some point in time has probably worked for an organisation that has decided to implement key performance indicators (KPI’s) or goals for teams and/or individual employees. As consultants we have had the opportunity to work with clients to develop and implement a robust process successfully to ensure both the organisation and individual employees see value in this process.

To successfully implement goals for departments or individuals, you must:

Have a clear understanding of what the organisation wants to achieve in the next 6 to 12 months. This shouldn’t be abstract. There should be clear measurable goals with a vision of where you want to be.

Begin with the end in mind; once you have your organisation wide vision and objectives for the next 6 – 12 months, work with your senior leaders to determine what needs to be achieved by each department to get there.

Department specific goals should then be broken down into individual responsibilities. Here department leaders should work with each individual employee to create clear measurable goals that they need to achieve.

Once these goals have been identified, document them and implement a process to review progress regularly. There are great technology platforms out there that can support with this process (e.g. Onloop)

Adapt and refine – priorities change, and businesses need to adapt. Ensuring your leaders and teams understand this and adapt accordingly is critical to success.

Discuss organisation wide progress regularly. Take the time to recognise and celebrate success.

For assistance with implementing goals for your organisation, please get in touch with us.

 

Ask an Expert: 

We understand that the Fair Work Commission is currently going through a review of the national minimum wage and therefore the minimum wage in all modern awards. Does Liquid HR have an indication on what they expect the increase may be to help inform our budget?

Since 1 July 2021, the national minimum wage has been $772.60 based on a week of 38 ordinary hours ($20.33 per hour).

This is the base rate for adult employees in the national system who are award/agreement free. For employees covered by a modern award, the minimum hourly rate is outlined in the applicable award.

Submissions from the Federal and state governments, major employer groups and unions have been received.

  • The AI group is asking for a 2% increase
  • The Australian Chamber of Commerce and Industry is asking for a 2.5% increase
  • The Australian Council of Trade Unions is asking for a 5% increase

All submissions can be reviewed here.

Whilst it is impossible for us to determine in advance what the increase will be, it is likely the increase will be between 2.5 – 5%. We will notify all clients once the decision has been handed down (generally this occurs in late June).

For more information on the above, please contact us on 1300 887 458 and speak with one  of our HR Consultants. If you are interested in learning more about our HR services, including HR OutsourcingHR ConsultingHR Advisory Services, contact us at enquiries@liquidhr.com.au.