What is happening in the world of HR for small businesses?
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Minimum Wage Increase Announced for 2025/26
The Fair Work Commission has announced a 3.5% increase to the National Minimum Wage, taking effect from the first full pay period on or after 1 July 2025. This will raise the hourly minimum wage to $24.95.
While this headline figure is important, we strongly recommend holding off on making any changes until updated pay guides for your specific Modern Award are released. These updates often include other adjustments, and waiting ensures you’re fully aligned with all relevant changes for your business.
Given the size of this increase, now is a great time to review your current pay structures, especially for employees on annualised salaries or flat hourly rates, to ensure they still meet minimum entitlements and comply with the Better Off Overall Test (BOOT).
It’s also important to note that from 1 January 2025, new amendments to the Fair Work Act introduced serious penalties for employers who intentionally underpay staff, including fines of up to $7.8 million and up to 10 years’ imprisonment for individuals involved in wage theft.
Free Webinar: Award Increase 2025 – What Do Employers Need to Know?
Join us tomorrow at 7.30 pm (Wednesday, 25th June 2025) where Carli and Frances will break down what the 2025 changes mean for small businesses. Whether you pay Award rates or above, this webinar will help you feel confident that you’re meeting your obligations. Can’t make it live? Register anyway, and we’ll send you the recording after the session.
Need help to take the guesswork out of paying people correctly?
Our Compliance Check is a once-off Salary Benchmarking Audit that gives you clarity and confidence. We’ll review your current pay rates against the relevant Modern Award classifications, check for any gaps or risks, and complete a BOOT (Better Off Overall Test) if you’re paying above-Award or using flat rates.
Perfect for businesses who:
- Want to double-check that pay rates are legally compliant
- Use flat rates or above-Award wages
- Are you planning wage increases or have you had recent changes in roles
- Want to reduce risk and feel confident about how they pay their team
This new Fixed Price Service is based on the number of employees you need reviewed. Discounts apply if we’ve benchmarked your business in the last 12 months, and you are members of partner organisations.
Reach out to info@strawberryseed.com.au for more information.
Increase to Superannuation Guarantee from 1 July 2025
From 1 July 2025, the Superannuation Guarantee (SG) will rise from 11.5% to 12% of an employee’s Ordinary Time Earnings (OTE). This is the final legislated increase under the current schedule.
Whether your employees’ salaries are expressed as inclusive or exclusive of superannuation will determine how this change affects them and you. If wages are expressed exclusive of super, your payroll costs will rise. If salaries are inclusive, employees may see a reduction in their take-home pay.
What does “inclusive of super” really mean?
When you offer a salary of “$70,000 + super”, the superannuation is in addition to the base wage; this structure is exclusive of super, which aligns with how pay is outlined in Modern Awards. It also makes future super increases simpler to apply.
However, some executive or professional packages are structured as “inclusive of super”, for example, “$96,000 inclusive of super.” If this is clearly stated in the employment agreement, and the contract allows for super increases to be absorbed, then the base salary will decrease to accommodate the higher SG rate.
Should you absorb the increase?
While you can legally absorb the increase if the contract allows it, the real cost may be cultural. Reducing an employee’s take-home pay, even if legally permitted, can erode trust and lead to disengagement or turnover. It’s worth considering the broader impact before taking this approach.
For guidance on how to navigate this change fairly and clearly, reach out to the Strawberry Seed team. We’re here to help.
Paid Parental Leave – Extended Leave & Added Super
From 1 July 2025, the Australian Government will increase Paid Parental Leave (PPL) from 110 to 120 days (22 to 24 weeks) for children born or adopted on or after that date. This gives parents an additional 10 days (or approximately 1½ weeks) to spend with their newborn. Even if a claim is submitted before July, once the birth or adoption occurs on or after 1 July 2025, you’ll automatically receive the extended entitlement.
This change coincides with the introduction of superannuation contributions on PPL. Eligible parents will receive a 12 % Super Guarantee payment on their PPL amount, deposited into their nominated super fund. These contributions are paid as a lump sum by the ATO after the end of the relevant financial year (i.e., from July 2026 for leave taken between July 2025–26). The intent is to help close the retirement savings gap, particularly affecting women, by normalising super contributions during parental leave.
NSW Portable Long Service Leave for Community Services
On 1 July 2025, NSW will launch a new portable long service leave (PLSL) scheme specifically for workers in the Community Services Industry (CSI), targeting roles such as domestic violence support, homelessness services, community housing, and more. Under the scheme, employees (including casuals, part-timers, and contractors who opt in) will accrue service credits across jobs and become eligible for six weeks of paid long service leave after seven years of cumulative industry work.
Employers must register with the Long Service Corporation, pay a quarterly levy (around 1.7 % of gross ordinary wages), and record employees’ service hours. Employers registering workers between 1 July and 31 December 2025 gain a bonus “foundation worker” year, granting an additional 365 service credits, effectively fast-tracking entitlements. Reporting and levy payments begin in April 2026, but the system becomes effective from July 2025. This reform ensures vital community sector workers retain leave entitlements despite changing jobs.
Right to Disconnect for Small Business
From 26 August 2025, the new Right to Disconnect will apply to all employers, including small businesses (those with fewer than 15 employees). This workplace right allows employees to refuse to respond to work-related calls, emails, messages or other communications outside of their regular working hours, unless the refusal is unreasonable. Factors that determine what is “reasonable” include the nature of the role, the urgency of the matter, any compensation arrangements (e.g. on-call allowances), and the employee’s circumstances (such as family responsibilities or health).
Employers must ensure their managers and team leaders understand the implications of this right and adapt expectations accordingly. Policies and communication protocols may need to be reviewed and updated to avoid inadvertent breaches. Disputes can be raised formally through the Fair Work Commission, and ongoing non-compliance could expose businesses to penalties or reputational risk. It’s recommended that small business owners set clear boundaries, include communication expectations in employment contracts or handbooks, and discuss reasonable availability as part of team norms.
Casual Conversion for Small Business
Also, from 26 August 2025, small businesses will be required to comply with new casual conversion obligations introduced under the Fair Work Legislation Amendment (Closing Loopholes No. 2) Act 2024. These laws give casual employees with at least 12 months of continuous service the right to request conversion to permanent employment (part-time or full-time), provided they have maintained a regular pattern of hours that could continue without significant adjustment.
Unlike larger employers, small businesses are not obligated to offer conversion proactively, but they must consider and respond to employee requests in writing within 21 days. Refusals must be based on reasonable grounds, such as significant changes to operational requirements or the employee’s hours. Businesses should review casual employment arrangements, track employee service periods, and ensure managers are equipped to assess and respond to conversion requests properly. Employers may also want to review rostering practices and plan for how they will manage requests to convert, especially if the employee’s hours have become predictable.
South Australian Portable Long Service Leave (PLSL) Scheme for Community Services,
From 1 October 2025, South Australia will implement a portable long service leave (PLSL) scheme for the community services sector. This allows eligible workers, such as those in disability support, homelessness services, youth and family services, and domestic violence support, to accrue long service leave entitlements even if they change employers within the industry. Workers will be entitled to 13 weeks of leave after 10 years of service, with ongoing accrual of 1.3 weeks per additional year. Pro-rata payments may apply if they leave the sector after at least seven years of service.
The scheme will be administered by the SA Portable LSL Authority and funded by a 2.2% levy on ordinary wages, paid quarterly by employers. Businesses must register themselves and their eligible employees by the end of October 2025 and start submitting quarterly wage data and levy payments from early 2026. The scheme applies to full-time, part-time, and casual workers under relevant awards and enterprise agreements. Employers will no longer need to independently manage long service leave accruals once workers are registered in the scheme, and may be reimbursed if they pay leave to an eligible worker post-commencement.
Employers should begin preparing by identifying eligible workers, updating contracts and payroll systems, and ensuring they understand the reporting and levy obligations before the scheme starts.
Other State Changes
Several states are updating payroll tax thresholds, tobacco licensing, road-speed regulations, strata legislation, and criminal record check rules starting in July. While these fall outside of our areas of expertise, they are worth checking into if they will affect your business.
Upcoming Training
Ready to grow your leadership skills? Enrolments now open for Lead With Impact, starting 22nd July!
After a sold-out first course that has just concluded, the Lead With Impact course returns this July. An online, interactive leadership development program designed specifically for small business leaders, people managers, and emerging supervisors.
Delivered over five practical modules, this course combines self-paced learning, live group workshops, and tailored coaching to help you lead with more clarity, confidence and purpose.
What’s included?
- Five learning modules covering feedback, expectations, conflict, communication and more
- Pre- and post-work to help embed your learning
- Interactive online workshops with a small group of peers
- Personalised coaching to apply your learning to real workplace challenges
- BONUS: DISC behavioural assessment and 1:1 debrief session to kickstart your leadership insight
Early bird pricing is available until 30th June, and further discounts are available for returning Strawberry Seed clients and group bookings. To learn more and enrol, click here.
One Day Leadership Training Workshops – in person
We have two more Leadership Training Workshops scheduled for the remainder of 2025. We will be in Sydney in August and Geelong in October.
Early bird rate applies, and Sydney is selling fast. Discount codes are available for returning package clients. For more information and details on how to book, click here.
Mental Health First Aid Training
Mental Health First Aid training teaches practical first aid skills to help a team member or co-worker experiencing mental health issues. We’ll teach you how to approach someone struggling, ask the right questions and assist them in accessing professional help.
The next scheduled session is a Face-to-Face Refresher Course at our head office in Torquay, Vic, on the 13th August 2025.
The Mental Health First Aid Refresher Course is a requirement before your original accreditation expires in 3 years. The course updates and builds upon skills learned from the initial 12-hour mental health first aid course that participants undertook. Refresher courses contain new films and additional materials. This course is delivered in a 5 hour online session or 4 hour face-to-face session.
In 2025, we have several options for attending public and private in-house Mental Health First Aid training, as well as refresher courses. The details and dates for the upcoming sessions can be found here. Discount codes are available for HR Package clients.
For more information on private courses, contact mhfa@strawberryseed.com.au.
