Opposition leader Bill Shorten has tried to frame the 2019 election as a “war on wages”. Mr Shorten claimed last week the laws of supply and demand in the labour market were broken; that the economy forces were not able to deliver appropriate wage rises for workers.
He has been vociferous in his criticism of the Fair Work Commission’s decision to impose a gradual reduction in the penalty rates payable on Sundays and public holidays to employees in the hospitality, fast food and retail industries. In his pledges, Labor commits to amending the Fair Work Act 2009 to restore the previous penalty rates in these industries and prohibit any future variations to Modern Awards that will result in a reduction in the take-home pay of employees.
He then aligned to the ACTU’s campaign for a “living wage”, which would push the minimum wage to 60 per cent of the national median wage. Mr Shorten has contended Australia’s industrial system requires a radical reboot. Yesterday he confirmed that Labor is looking to amend the Fair Work Act to force the independent industrial umpire to raise the National Minimum Wage.
Prime Minister Scott Morrison has since accused Mr Shorten of forcing businesses to “sack” people to give others a pay rise. As it stands, the current National Minimum Wage of $18.93 an hour, is one of the highest minimum wage rates in the world. Notably, in the past two years, the Fair Work Commission (FWC) granted wage rises in excess of inflation, 3.3 per cent in 2017 and 3.5 per cent last year. But Mr Shorten claims that is not enough, calling employers “fat cats.”
Now, in support of the ACTU submission in the FWC, Mr Shorten is encouraging a $43 weekly increase in the National Minimum Wage, equal to a six per cent rise. Such a jolt to wages — with no regard for its effect on small businesses — would be a blunt economic blow, as Mr Morrison pointed out.
Mr Morrison said the Labor leader needed to be clear about how many jobs the plan would cost and how many businesses would shut down. Employer groups parallel those concerns – warning against compromising the independence of the industrial relations tribunal, while also arguing unsustainable pay increases will cost jobs.
All Australian employers will need to prepare for the most significant wave of reforms in the workplace relations space since the introduction of the Fair Work Act in 2009.
If ever there was a time for small business to have their say, it will be at the next Federal Election.
Nicholas Hackenberg, Senior Employment Relations Adviser, Employsure