The minimum wage will increase by $13 a week, boosting the pay packets of 2.2 million Australians.
The Fair Work Commission made the decision to lift the minimum wage, however the increases will be phased in over time.
Minimum wage increases
The increase takes the minimum wage to $753.80 per week, or $19.84 an hour.
It works out to an increase of 1.75 percent – well below the 4 percent increase unions wanted.
However, it’s more than the wage freeze business groups argued for.
The Commission said the job market faces an “unprecedented” shock, caused by the coronavirus pandemic.
Despite the pressures employers face, the Commission said if it didn’t increase wages, some families will be forced into “poverty”.
Commission President Iain Ross said:
“Some low-paid households are plainly experiencing significant disadvantage.
“An increase in minimum wages would assist these employees to better meet their needs.”
Phased in over time
Previous wage increases have taken effect at the beginning of the new financial year.
However, because of pressures on certain industries brought about by the pandemic, this increase will be phased in over time.
The first wave will come into effect on July 1 for the following industries:
- and other essential services.
The second wave will start at the beginning of November, and the final wave will take effect in February for industries badly effected by the pandemic.
For example, tourism, hospitality and retail.
Commission rejects union calls for 4 percent increase
In dismissing union calls for a 4 percent increase, Mr Ross said:
“We have concluded that in the present economic circumstances, awarding an increase of the size proposed by the ACTU would pose a real risk of disemployment, and of adversely affecting the employment opportunities of the low-skilled and young workers.”
While expressing disappointment, ACTU Secretary Sally McManus said a pay rise is better than no pay rise.
“We would’ve liked to have seen more, of course.
“But the fact that they’ve rejected the arguments of the employers about wage cuts, so effectively freezing wages, cutting wages, is a positive thing.”
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