As you may know, from 1 July 2026 minimum rates under the Health Professionals and Support Services Award, national minimum rates, and the High Income Threshold have increased. Additionally, there has been a change to how superannuation is paid.
If your employee has progressed in responsibilities, skills or qualifications, or has been working in the same full time role for 12 months, he/she may be entitled to advance up the Award. Documentation of a formal written assessment is important to evidence your rationale for increasing rates or not, and to minimise risk of an accidental underpayment. If you haven’t formally documented your employees’ reviews and assessments, and have also not reviewed their rates against the new increases, there is double the risk of a potential underpayment so we suggest taking action now to ensure compliance.
There is a reverse onus of proof in underpayment claims, which are affordable and easy to file, meaning Fair Work will presume the employee is correct unless the employer can evidence otherwise. Consequently,documentation of regular reviews and assessments are critical in forming evidence if you need to defend a complaint. Depending on the circumstances and location, some underpayments attract criminal liability which may include hefty fines, and imprisonment, demonstrating the seriousness placed on compliance by this Government when protecting employees.
In addition to compliance and legal risk, formal performance reviews are also key to maintaining employee alignment, providing the right forum for feedback as well as to plan and set goals for development and growth. High employee turnover, apathy and general disquiet can result from lack of positive management initiative and action, leading to increased costs and time taken to restore harmony. As a result, we suggest equipping your manager with leadership skills and ensuring he/she takes initiative and action to engage and keep the team aligned.
Let’s say your full time Receptionist has been Level 4 $28.12 for a year, and has now progressed to training and supervising others. Your Receptionist will now likely be classified as level 6 justifying a pay increase AND is entitled to a further increase from 1 July comprising a new minimum of $32.09. If your Receptionist works a Saturday morning, the minimum Saturday rate will be $48.14. If you forget to apply the Saturday rate, or rely on a higher base hourly rate without a properly constructed clause in the written contract, then you will be risking an underpayment. All ClinLegal contracts on our portal include a properly constructed set-off clause which meets new requirements outlined by recent legal decisions. Additionally the ClinLegal contract App provides a link to the new minimum award rates and automatically calculates hourly rates and superannuation, saving time and minimising risk.
The national minimum wage, which applies to non-award employees is now $26.44 per hour, and the High Income Threshold which applies to both employees and contractors is now $190,100. Award free employees earning over the threshhold lose unfair dismissal coverage.
From here, we anticipate further changes including the already announced increases to Dental Assistants’ and Oral Health Therapists’ rates and classifications on 31 December 2026 as explained in our last Circular Here. Other anticipated changes include the eventual removal of junior rates from the Award, and the implementation of legislation to render restraints of trade in contracts where workers earn under the High Income Threshold to be of no effect.
As a reminder from the 1st of July there has been a shift in the way superannuation is paid from super previously being paid quarterly to the new payday super model. This means superannuation contributions should be made on payday into the Employees nominated account at the same time as salary or wages, instead of every three months.
We recommend ensuring compliance through:
- Reviewing rates and classifications and making any necessary updates to payroll systems.
- Updating penalty rates and overtime if required. External advice may be required regarding how staff are classified or if your practice is obliged to make changes.
- Reconciling updated pays to limit risk of accidental underpayments, especially relevant for flat hourly rates or annualised salaries, penalty or overtime rates, allowances and other entitlments, and the drafting of any set off clauses.
The increase to the high income threshold to $190,100 for contractors and employees is particularly relevant for staff sitting near the threshold. Keep your eye out for our next Circular that will discuss the change, what it means for practices as well as how independent contractors can opt out of the “whole of relationship test” to avoid being classed as employees and accidentally underpaying their entitlements.
If you would like personalised help to ensure compliance or to access the ClinLegal Contract App and helpful resources, please Click Here to sign up to our Concierge Member service which gives you access to these digital tools and saves time, minimises risk, and aligns with Fair Work rules, helping you to streamline your HR functions.
This Circular acts as a guide and does not constitute legal advice. For specific circumstances legal advice should be sought, if you require tailored legal advice please contact [email protected].
Authored by:
Charlotte Jones – Legal Assistant
Yasmine Healy – Head of Legal
