australian money in wallet on real estate background

The Fair Work Commission’s Expert Panel for annual wage reviews handed down its decision, which directly affects more than 2.3 million Australians paid at the minimum rate.

Among the reasons given for the decision was that profit growth was particularly strong in 2016 compared with the preceding years and above the five-year and 10-year averages.

“The prevailing economic circumstances provide an opportunity to improve the relative living standards of the low paid and to enable them to better meet their needs,” the FWC stated.

“We acknowledge that the increase we propose to award will not lift all award-reliant employees out of poverty, particularly those households with dependent children and a single-wage earner.

“However, to grant an increase to the NMW (national minimum wage) and award minimum rates of the size necessary to immediately lift all fulltime workers out of poverty, or an increase of the size proposed by some parties, is likely to have adverse employment effects on those groups who are already marginalised in the labour market.”

Australian Chamber of Commerce and Industry employment director Jenny Lambert said the decision puts pressure on small and award-reliant businesses facing increasing competition.

“More than 744,000 Australians are looking for work, and among those finding it most difficult are young people, first-time job seekers, people with low skill levels and long-term unemployed people,” she said.

“These are the people whose job prospects are most at risk from minimum wage increases beyond what is affordable for small and award-reliant business.

“Wage rises across the rest of the economy have been far lower than this figure, which means the Commission has put a greater burden on the small and medium businesses who rely on awards, making it harder for them to compete.”

Australian Retailers Association executive director Russell Zimmerman said the increase would suppress the benefits to business gained through the recent decision to lower penalty rates.

“This upsetting increase will strongly impede on employment growth within the industry,” he said.

Australian Council of Trade Unions secretary Sally McManus this decision was one to keep minimum wage workers and their families living in poverty.

“If there was ever a time in history when Australians needed a pay rise it is now,” she said.

Originally published as Extra $22 a week for lowest-paid workers