Working Life

Minimum wages now in business’ sights


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We believe in the free flow of information, and content on Working Life is available to be republished online or in print under a Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License.
By Mark Phillips

Editor of Working Life

Wednesday, 31 July 2013

FIRST it was penalty rates. Then came the resurrection of individual contracts. Now business groups are going after minimum wages in their campaign to cut the conditions and rights of Australian workers.

The Business Council of Australia – the union for the CEOs of Australia’s largest 100 companies – has opened up this new front in a major report released today titled Economic Action Plan for
Enduring Prosperity.

A recommendation within the report urges the Treasurer to establish a Productivity Commission inquiry into the workplace relations system examining, among other things, penalty rates, individual agreements, and minimum wages.

This puts more flesh onto the federal Coalition’s industrial relations policy proposal to set up a Productivity Commission inquiry as one of the first orders of business should it win this year’s election.

The BCA’s report is the latest salvo by business groups agitating for a return to WorkChoices-style policies ahead of election day.

In the past week, both the Australian Industry Group and the Australian Mines and Metals Association have also released reports calling for wholesale changes to the workplace system.

Following encouragement from the Coalition that business had to raise the volume on workplace issues to create an atmosphere conducive for change, they all seem to be singing off the same song sheet, with wider use of individual contracts, tighter restrictions on workers’ ability to be represented by a union and to take industrial action, and the removal or reduction of penalty rates.

But until now, no-one has dared to touch the minimum wage.

As ACTU Secretary Dave Oliver wrote in a recent article for Working Life, Australia’s minimum wage is a living wage, and one of the things that separates us from countries like the United States.

Every year, Australian unions, led by the ACTU, go into bat in the Fair Work Commission on behalf of the 1.5 million Australian workers who rely on Award minimum wages, whether they’re in a union or not.

“In Australia, we believe that if you work hard, you should get a fair day’s pay. You shouldn’t have to rely on tips to keep your head above water, and you should be able to put something away to plan for a better life,” Mr Oliver wrote.

“The spirit of a fair go that is imbued in our national character means we don’t want to see anyone left behind.”

WATCH: Leah explains why penalty rates are important

The president of the BCA, Tony Shepherd, has tried to play down the significance of the attack on minimum wages, but it’s there in black and white on page 90 of the policy document, couched in non-threatening language:

“the extent to which the high minimum wage prevents new labour market entrants from gaining initial experience, to inform future wages policy directions.”

That can only mean one thing: cutting minimum wages.

The national minimum wage in Australia is $622.20 a week, after an increase of $15.80 a week began at the start of July.

The gap between the minimum wage and average earnings has widened sharply over the past decade.

The average wage of a CEO of a top 300 ASX listed company was $2.5 million last year, an increase of 6% – or 77 times the minimum wage.

“Our minimum wage is certainly high by world standards but we’re not for a second suggesting it should be reduced,” Mr Shepherd claimed on ABC radio this morning.

He added: “We believe the gap between low income earners and high income earners is about right.”

Meanwhile, the campaign by the business lobby to abolish penalty rates is building.

McDonald’s Australia CEO Catriona Noble – who chairs the BCA’s workplace committee – has effectively told university or school students that they are not welcome to work for her company if they want penalty rates.

“We don’t want every person who works nights and weekends to have penalty rates when they are not available to work Monday to Friday,” she said, according to the Australian Financial Review.

Leah, who works in a women’s refuge centre in Sydney, has a different point of view.

Her centre has to be staffed 24 hours a day, seven days a week, 365 days a year – and penalty rates are important part of the compensation for those rostered to work those hours.

Co-incidentally – or perhaps, not so coincidentally – today’s newspapers have also been dropped a story from the Coalition which rehashes once again its plans to tie unions up in more red tape to limit their capacity to represent workers.

A clear joint strategy is starting to take shape: business groups advocating for retrograde cuts to wages and conditions, hand in hand with a Coalition that would deliberately weaken unions so there is no-one to protect workers.

Given the title of the BCA’s report released today, the question has to be asked: enduring prosperity for whom? Certainly not for Australian workers.

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Working Life is a forum to share ideas and opinions about work and life, both light-hearted and serious. The opinions presented on Working Life are those of the author, and do not necessarily represent policies or views of the ACTU.


Creative Commons License
We believe in the free flow of information, and content on Working Life is available to be republished online or in print under a Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License.


  1. Michael Powell
    Wednesday, 31 July, 2013 at 9:23 pm · Reply

    $620.00 per week????!!! I have NEVER in my entire 47 years working life received that sum on a weekly basis and I often work part time as a Registered Nurse! True it is my choice not to work full time for anyone other than myself but my business ventures over the years have NEVER EVER earned me the “minimum wage” that you talk of.

    That aside I think that this whole thing smacks of WORK CHOICES all over again.

    • Connor
      Friday, 14 March, 2014 at 3:54 pm · Reply

      That’s before tax.

  2. Cassandra
    Thursday, 1 August, 2013 at 9:42 am · Reply

    Recent pronouncements by the Business Council of Australia, The Institute of Public Affairs and other right wing ‘think tanks’ and Liberal politicians like Hockey, Abbott, Joyce and failed leaders like Howard and Reith give us clear warning what we can expect from any Liberal Party led government.

    The ‘blueprint’ enacted by the Newman Government in Queensland will be enacted nationally – huge public service cuts, a massive transfer of public works and services to the private sector, a sell off of our assets and a ‘crackdown on ‘welfare’ all to fund the massive subsidies to business and the top 5%. Central to all this of course will be a Queensland like crackdown on Trade Union activity using the current Victorian and NSW court cases of alleged corruption by a few union officials and the union strength in the construction industries and public sector as the excuse.

    There is no evidence from anywhere in the world that low wages result in higher productivity – in fact the contrary is more likely. There is also no evidence that higher profits flow back to the community in more jobs or increased government revenue again all the evidence points to the opposite happening. The increased loot to the private sector goes in higher salaries to the top executives and maybe to some shareholders. Smart accountants and lawyers ensure that the government share of these higher profits is minimal- if any. Look at the way the mining companies used write down provisions to minimise the tax our government expected to get from the resources tax – at that was a tax the companies had agreed was socially and politically acceptable!

    We vote Tory at our peril!

  3. Butch
    Saturday, 3 August, 2013 at 4:05 pm · Reply

    Not much better in NZ..Minimum wage in NZ is $13:75 per hour which is pretty disgusting. works out to $ 500 a week…yuck !! try and live on that !!

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