The Fair Work Commission is set to announce the National Minimum Wage and awards wages next month, which will go into effect from July 1.
Various stakeholders, including small business representatives like the Council of Small Business Organisations Australia (COSBOA), are advocating for sustainable wage increases aligned with inflation to address rising costs.
Meanwhile, industry associations like Master Grocers Australia and the Australian Retailers Association have proposed specific percentage increases, considering the impact on businesses and employees.
Here’s a summary of peak body submissions on minimum wage awards.
COSBOA has highlighted the challenges faced by the sector amid rising costs and declining profitability. Emphasising the significance of labour costs, particularly in labour-intensive industries like hospitality, which can account for over 40% of overall operating costs.
The small business representative is concerned that wage costs have been steadily increasing, with last year seeing significant increases in minimum wages of 8.6%, and an award rate lift of 5.75%.
COSBOA argues legislative wage increases impose additional costs on small businesses, including superannuation, workers’ compensation, and payroll tax.
The organisation has recommended that any increase to the minimum wage should be capped at 3%. It also urged the government to prioritise measures to boost productivity and reduce compliance burdens.
The Australian Council of Trade Unions (ACTU) has called for a 5% increase in the minimum wage and said inflation has left workers on awards more than $5000 worse off, even when accounting for their pay rises over the past three years. The nation’s largest union has also advocated for a 9% pay rise for workers in key feminised industries.
The union’s submissions filed with the Fair Work Commission said the 9% rise is based on the 5% increase it is advocating across all awards supplemented by at least an additional 4% in key low-paid feminised industries.
MGA Independent Businesses Australia (MGAIBA) has recommended a 2.7% wage increase in the General Retail Industry Award and the Timber Industry Award for 2024.
It emphasised the critical role of small businesses in communities, employing local residents and supporting local producers.
MGAIBA argues the potential imposition of higher minimum wages beyond 2.7% could lead to reduced employment, price hikes, and even business closures.
The Australian Retailers Association (ARA) is advocating for an equitable increase in the minimum wage to address cost of living pressures while keeping business costs in check.
It has proposed a 3.1% increase in the minimum wage, aligned with Reserve Bank of Australia forecasts for inflation and considering the impact of superannuation increases and Stage 3 tax cuts.
The suggested increase aims to complement other measures, such as tax cuts, to provide relief to retail workers.
The ARA emphasised the importance of considering the impact on businesses, particularly small retailers, who face significant cost pressures and reduced margins.
While supporting the government’s objective of driving wage growth, it stressed the importance of addressing the imbalance between wages and productivity and considering the broader economic environment.
The Australian Chamber of Commerce and Industry has advocated for an increase of no more than 2% for both minimum and award wage workers.
The employer group says inflation has been moderating and the industrial umpire had been generous in its past two decisions.
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