Three-pronged pay push will hurt employers, business groups claim

Employers will face a three-pronged pay push in coming months as unions seek pay increases for adult apprentices and other workers, while junior retail workers could also receive a pay rise.

Under the annual minimum wage review, the Australian Council of Trade Unions will seek pay increases of $23-$25 a week for Australia’s lowest paid workers, representing a rise of about 4%.

It will also seek a percentage increase for higher-skilled workers who still rely on awards.

Unions will also run a test case to lift the pay of about 200,000 adult apprentices to the minimum wage in their industry, arguing their pay needs boosting in order to fill skills shortages.

Meanwhile, the Shop, Distributive and Allied Employees’ Association will apply for the adult wage to be paid to 20-year-olds instead of starting at 21 years of age.

But the Australian Retailers Association is less than impressed with the SDA’s proposal, with executive director Russell Zimmerman saying the retail industry is already struggling.

“A vast number of retailers are in either financial difficulty or are closing up. With these kinds of claims from the union, we would not want to see any more retailers close their doors,” he says.

“What retailers will be forced to do – if these sorts of things happen – is look at their staffing levels and that will probably mean there will be lost jobs in the industry.”

“There should be no change to [wages] at all. Retailers cannot afford for these rates to be reviewed, where 20-year-olds are on adult wages. The industry cannot afford it.”

“We would be very concerned and we would want to be putting [forward] an alternative case.”

With regard to the apprenticeship pay push, Workplace Relations Minister Bill Shorten said while the government supports apprentices, it also supports employers continuing to offer apprenticeship positions.

“I do think we need to look closely at addressing existing low rates of pay as this is about the kind of skills our economy has well into the future,” Shorten said yesterday.

“But we need to get the balance right and make sure it is not too expensive to train apprentices.”

Last year, a government-commissioned panel found 48% of apprentices did not complete their training, with low pay and lack of support being the main reasons.

But the Australian Chamber of Commerce and Industry claims the wage increase for apprentices will discourage employers from taking on trainees rather than “fixing” the skills shortage.

According to ACCI chief executive Peter Anderson, trade apprenticeship commencements have already fallen by 1% in the year to September.

“You have to understand the marketplace, and the ongoing challenge to encourage employers to take on apprentices,” Anderson told the Australian Financial Review.