The Fair Work Commission has announced a $13 a week increase in the national minimum wage, affecting more than 2.2 million workers.
The national minimum wage will rise by 1.75 per cent to $753.80 a week or $19.84 per hour from 1 July.
The rise falls short of the 3 per cent increase to the minimum wage last year. Business groups had argued the minimum wage should be frozen until mid-2021.
Commission president Justice, Iain Ross, said the shock to the jobs market in the wake of COVID-19 has been “unprecedented”.
“The outlook, including the nature and speed of the expected recovery, remains highly uncertain,” Ross said.
“The shock to the labour market warrants more weight being given to the potential impact of increasing minimum wages on hiring and re-employment.”
However, he said the economic matters are not the only factors the panel is required to take into account.
“Some low-paid households are plainly experiencing significant disadvantage.
“An increase in minimum wages would assist these employees to better meet their needs.”
The Fair Work Commission said the wage rise will be staggered for different industries.
Frontline healthcare, social assistance, teachers and childcare workers will receive the increase from 1 July; construction, manufacturing and other industries from 1 September; and accommodation, food services, arts, recreation, aviation, retail and tourism from 1 February.
United Workers Union said it welcomed the Fair Work Commission recognising cleaners as essential service workers included in the first phasing of the award rise.
“Many essential workers are also some of Australia’s lowest paid. Australia has been able to manage the public health crisis of COVID-19 because of the frontline workers we have all relied on,” Jo-anne Schofield, national president, United Workers Union, said.
“Whilst this very modest rise will lead to some relief for the sectors eligible from 1 July, the staggered approach will lead to greater inequality across our workforces in this damaged economy.
“We welcome the Fair Work Commission recognising our cleaners as essential service workers included in the first phasing of the award rise, alongside early childhood educators and aged and home care workers.
“But it is a troubling decision for our security guard members excluded until the second phase and our hospitality and food services members who will face a rising cost of living whilst excluded from any wage relief until 1 February 2021.”
Sally McManus, secretary of the Australian Council of Trade Unions (ACTU), said the wage rise is a “modest increase” and it is disappointing that several awards will not see any increase until November or February.
“However it is clear in the decision that this panel of experts recognise that cutting wages in the middle of this crisis would be a disaster for working people and the economy and they have rejected the arguments put by some employers to effectively cut wages by freezing the minimum wage.
“Many of the workers who will benefit directly from this decision are the essential workers who have been getting us through the pandemic. They deserve to have their wages protected.”
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