Australian Council of Trade Unions (ACTU) has announced its plan to submit to the Fair Work Commission Unions a $50-a-week increase to the minimum wage, which is more than doubling their claim from last year.
ACTU secretary Sally McManus argued the rise is necessary since many workers are on the minimum wage work in retail and hospitality.
“These are exactly the same people who are facing a penalty rates pay cut on the 1st of July as well,” she told ABC radio.
Finance minister Mathias Cormann said the commission needed to give careful consideration to the economic impact of any wage increase.
“If you increase the minimum wages further when we already have one of the highest minimum wages in the world, without taking steps to improve the profitability of business, you will drive more people into the unemployment queues,” senator Cormann told ABC TV.
Furthermore, employer groups also warned against an excessive increase, saying now is not the time to take risks with the minimum wage. Australian Retailers Association (ARA) executive director Russell Zimmerman said the proposed increase fails to take into account the circumstances of small business and is well above inflation.
“It’s over the top … way too high of a claim,” he said. “It doesn’t take into account the circumstances of small businesses, or the conditions in the retail sector at the moment.”
Zimmerman said that the ARA’s forthcoming submission to the commission will recommend a “modest” increase in the minimum wage, in line with inflation.
Australian Industry Group’s (Ai Group) submission to Fair Work calls for a 1.8 per cent raise, the equivalent of $12.50 extra a week, while the ACTU’s proposal amounts to a 7.2 per cent hike. Ai Group chief executive Innes Willox said a dramatic increase would reduce the job security of low paid workers and lower employment opportunities for the unemployed and underemployed. He said it was essential the Fair Work Commission opted for a more modest increase than last year.
“The 3.3 per cent minimum wage increase awarded by the panel last year was exceptionally high and out of step with economic factors,” Willox said.
Federal Labor will push for a higher minimum wage, though they are yet to decide on a figure. The opposition’s finance spokesman Jim Chalmers said their submission would not be made in conjunction with the ACTU, but backed the tone of the union push.
“They’ve got a series of very good arguments, as they generally do, about wage justice in this country,” Chalmers told ABC TV.
Unions will rally in Melbourne on Tuesday in support of the ACTU’s push which is a major rise from last year’s claim of $22 a week. Once the commission has reached its decision, the changes will come into force on July 1.