Unions will seek a pay rise of $28 a week for the nation’s lowest paid workers along with a 4.2% increase for higher skilled workers, putting many employers under further pressure amid sluggish consumer spending.
Jeff Lawrence, secretary of the Australian Council of Trade Unions, says unions will seek a flat-dollar amount of $28 a week and a separate 4.2% increase for award-dependent employees.
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If successful, the percentage claim will translate into rises for more highly skilled workers of between $28.70 and $37.70 a week.
Lawrence says the nation’s strong economic growth should not be a “spectator sport” for low paid workers, arguing that while company profits have increased by 50% in the past five years, the real value of the minimum wage has increased by just 7.1%.
“The union claim is… modest and affordable. It will have a negligible impact on inflation and on labour costs, and there is no credible evidence that it will impact on employment,” Lawrence says.
A spokesperson for Workplace Relations Minister Chris Evans says the Government supports an increase for low paid workers but declined to specify an amount, simply stating that low paid workers should be able to share in Australia’s growing prosperity.
Last year, Fair Work Australia awarded a rise of $26 a week – $1 less than sought by the ACTU – after a pay freeze in 2009 due to the economic downturn.
If the ACTU’s new claim is granted, the minimum wage will increase to $15.73 an hour, lifting the full-time minimum wage from $569.90 a week to nearly $600.
But businesses are urging FWA to limit any minimum wage increase to $14 a week, with employer groups arguing that current crises in Japan and the Middle East are increasing economic uncertainty.
Australian Industry Group chief executive Heather Ridout says the FWA tribunal should be cautious in this regard, a sentiment also felt by the Australian Chamber of Commerce and Industry.
ACCI workplace policy director David Gregory says if accepted, the award will lead to less employment and fewer work hours for staff.
He says many sectors employing lower paid workers – including retail, hospitality, tourism and small-scale manufacturing – are already experiencing hardship in Australia’s “two or three-speed economy”.
Gregory says the ACCI submission will ask for a return to a more “cautious, modest and predictable” rise.
Meanwhile, Gary Black, executive director of the National Retail Association, says retailers cannot afford the claim, arguing it would “seriously impact” the already struggling sector.