Political battle over higher wages heats

moneyPrime Minister Scott Morrison has challenged Labor leader Bill Shorten to explain how he plans to drive up wages for low paid workers, while again warning it could lead to job losses.

Pay has emerged as a key policy divide between the major parties ahead of the election after Shorten hinted he could tweak industrial laws to promote a “living wage” if Labor wins government.

Morrison argues the opposition hasn’t detailed how it would do this and claims interfering with the work of the independent wage umpire would force businesses to sack people.

“He’s either lying to Australians that he can do something about their wages because he hasn’t explained how he’s actually going to do it,” he told reporters in Melbourne on Thursday.

“If he’s telling the truth then he’s putting an enormous cost on small and family businesses that will force them to lay off staff.”

Business lobby group Restaurant and Catering Australia is calling for a freeze on the minimum wage for the second year running, ahead of the Fair Work Commission’s 2019 review.

Major employer groups have locked in behind the prime minister’s warning that “unsustainable” pay increases could cost jobs.

But unions want the commission to deliver a $43-a-week increase in the minimum wage because low-paid workers are living in poverty.

Morrison visited a northern Melbourne market on Thursday morning, while Shorten will visit a retail packing business in the Victorian capital later in the day.

“Minimum wages should be set by the independent umpire, which is the Fair Work Commission,” the prime minister said.

Business Council of Australia CEO Jennifer Westacott has also sounded the alarm for small businesses having to pay more in wages.

“I want people to have higher wages but I don’t want them to have higher wages that are then seen in lost jobs,” she told Sky News on Wednesday.

She said low margin businesses could either sack people or pass on the cost to consumers in higher prices.

Labor is weighing up ways to encourage the Fair Work Commission to take more factors into account to ensure low-paid workers get a living wage, which unions define as equating to 60 per cent of the national median wage.

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