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2017-04-07

minimum wage increase ahead

Unions push for $45 minimum wage increase

Unions will argue for a $45 a week increase in the minimum wage when the Fair Work Commission starts dealing with the annual minimum wage case later this month. 

And, as usual, employer groups are arguing for less – quite a lot less in fact. 

The Australian Industry Group is proposing a 1.5% increase which equates to about $10 a week for a full-time worker. 

The Australian Retailers Association wants a rise of only 1.2%. That’s lower than the rate of inflation so would in fact mean a real wage cut! The Retailers are, of course, also sworn enemies of penalty rates. 

If the unions’ claim was accepted it would mean an increase almost three times as large as last year’s 2.4% increase (just over $15). But the Australian Council of Trade Unions (ACTU) say that that is what is needed if the ever-widening gap between the minimum floor and average wages is to be addressed. 

In 1985 the minimum wage was two thirds of the average wage. Today it’s less than 40%. The OECD recommends 60% as a benchmark if a country is to avoid creating a class of working poor. 

Having 2.3 million workers living within sight of the poverty line is not only unfair to those workers – it is against the interests of the community as a whole. 

While minimum wage earners tend to have jobs in sales or community/personal service areas, a low minimum wage is in fact a threat to all workers as it encourages a downward pressure on wage levels as a whole. And of course 2.3 million workers who are struggling to make ends meet hardly help drive the economy forward. 

That is why the union movement as a whole supports the increase in the minimum wage, even if most of its members are doing better than that – in large part, indeed, because they are union members.

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