"Fair Work" Widens Wage Gap

03 June, 2013 | ACTU Media Release

Today’s decision by the Fair Work Commission to raise the minimum wage by just $15.80 a week is a very poor outcome which will see 1.5 million low-paid workers and their families fall further behind, the ACTU says.

ACTU Secretary Dave Oliver said the Fair Work Commission had missed an opportunity to close the wages gap between low-paid workers and the average wage.

The ACTU had sought a moderate and affordable increase of $30 a week for the lowest paid, and 4.2% for people employed above the tradesperson rate.

After tax, today’s decision will give those on the minimum wage just $1.80 more a day.

“This decision is a kick in the guts for 1.5 million low-paid workers and their families that will only further widen the gap between the low-paid and average earnings,” Mr Oliver said.

“We are stunned that today the Commission has acknowledged that wage inequality is rising in Australia but it has done absolutely nothing about it. In fact, after this decision, it will only get worse.

“On top of that, Australia has had its best year of productivity growth in a decade, and yet again, low paid workers have nothing to show for that.

“As a result of this decision, the national minimum wage will continue falling as a percentage of average weekly earnings, from 50% in 2000, to 43.4% last year, and now to 42.7%.

“And to add insult to injury, will now also have to fund the increase to their superannuation savings that the government has promised.

“With Australia’s economy in good shape, this was the year to take action to establish a decent minimum wage which would help prevent the emergence of a US-style working poor.

“Instead, it will be remembered as a missed opportunity.”

Mr Oliver said low-paid workers deserved recognition for their contribution to the economy.

“Minimum wage workers have little bargaining power, and the annual wage case is often their only chance for a pay rise,” he said.

“We are talking about cleaners, hospitality staff, unskilled labourers and thousands of other workers who keep our economy and society functioning.

“Any further decline in the relative living standards of these low-paid workers will put in jeopardy the concept of a fair safety net of minimum wages.

“The rise of insecure forms of work in Australia - which sees millions of workers in jobs with unpredictable working hours and no access to sick leave or annual  leave - make a decent minimum wage more important than ever."