Unions Butt Heads With Industry Leaders Over Minimum Wage Increases

As we edge towards the Federal election, union and industry demands are ramping up.

The Australian Council of Trade Unions (ACTU) are calling for low-paid workers to receive a 5 per cent wage increase ‘keep their heads above water’, while the Restaurant and Catering Industry Association (RCIA) is demanding a wage-freeze.

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The ACTU believes Australia’s minimum wage needs to increase from $20.33 an hour to $21.35, to compensate for increases to the cost of living.

Lifting the annual minimum wage to $42,184, is “what is needed for Australian workers to keep their heads above water, with inflation and the cost of living rapidly rising,” ACTU secretary Sally McManus said.

“The Morrison government has projected real wage cuts this year, following on from the $800 cut last year,” she said. “This can be avoided if they support this wage claim.”

- Sally Manus

Meanwhile, Wes Lambert, RCIA’s chief executive warns that if minimum workers get a bigger pay rise it was “only a matter of time” before Australians would be paying $7 for a coffee.

Lambert argues that if the pandemic was considered an “extraordinary” event resulting in delayed pay rises in 2020 and 2021, then it would also be true of 2022 which had already doubled down with “Delta, Omicron, floods and critical workforce shortages”.

“The industry’s wage bill is as high as it’s ever been as a percentage of sales: over 40%. The only thing that can move is prices.”

- Wes Lambert

The Unions submission is certainly a response to the release of the 2022/23 Federal Budget which saw only temporary provisions delivered to combat high inflation and low wage growth among other things.

Inflation grew by 3.8% in 2021, compared to only 1.7% in wage growth, while this year inflation has already jumped by 1.25 per cent, without any wage adjustment.

Undoubtedly a difficult path to tread, the Australian Chamber of Commerce and Industry (ACCI) are calling for “extreme caution”.

ACCI Chief executive, Andrew McKellar, warns “small businesses are on a knife’s edge – the risk of further Covid-19 outbreaks, the impact of flooding in New South Wales and Queensland, and the ongoing conflict in Ukraine, continue to dampen the prospects of recovery”.

With so many sectors including tourism, arts and recreation “smashed by lockdowns and restrictions,” Mr McKellar said, “it will still take some time for many of these businesses to pay back debt accrued through the pandemic and return to profitability.”

Submissions to the minimum wage review close Friday.

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