Australian unions have called for a pay rise of 7% for the lowest-paid workers, a raise in the national minimum wage of $1.50 an hour to keep pace with inflation.
The Australian Council of Trade Unions made that submission to the Fair Work Commission’s annual minimum wage review, which sets the pay of more than 2.6 million employees on the national minimum or award wages.
If the increase is granted, the national minimum hourly rate would rise to $22.88 from 1 July, with bigger rises for those on award wages. The new national minimum would be $45,337 a year, up $2,966.
The ACTU submission argues that workers who rely on the minimum or award wages have suffered the greatest real pay cuts on record over the past two years.
On Wednesday the prime minister, Anthony Albanese, said the federal government’s submission would be “absolutely consistent with our values”, raising expectations that it would agree that wages should keep up with inflation.
But the deputy Liberal leader, Sussan Ley, seized on Albanese’s statement the government would not “put a dollar figure on that” to claim he was “backing away from the commitment he made to Australian workers that their wages will rise”.
Last year the FWC ordered a rise of 5.2% for the national minimum wage and 4.6% for award minimums, or at least $40 a week. Inflation peaked at 7.8% in the year to December, meaning the lowest paid experienced a real wage cut.
On Wednesday the Australian Bureau of Statistics revealed inflation had now eased to 6.8% in the year to February, which Albanese greeted as a “promising” sign that inflation was now heading in the right direction.
The ACTU secretary, Sally McManus, said “a 7% pay increase is essential” as it would “help working people keep their heads above water”.
“It is simply about survival for the lowest-paid workers in our country,” she said in a statement.
“There are real people behind the statistics of Australia’s cost-of-living crisis – the workers we rely on to deliver vital services in early learning, aged care, disability care, fast food, cleaners, security, and retail.
“People are skipping meals, avoiding medical care, and dreading their next bill. Rents have skyrocketed along with the cost of essentials such as groceries, clothing, fuel, and childcare.”
The chief executive of the Australian Chamber of Commerce and Industry, Andrew McKellar, warned that “a push for an inflation-matching wage increase risks inflicting more pain on our increasingly fragile economy”.
“While Australia appears to have turned a corner on inflation, it still remains stubbornly high,” he said.
“Pushing for unsustainable wage increases while the economic outlook remains precarious jeopardises the viability of small businesses and the jobs they sustain and create.”
On Wednesday the workplace relations minister, Tony Burke, said Labor’s values “haven’t changed” since it backed a minimum wage rise in line with inflation at the 2022 election. The government’s submission will be made public on Friday.
Burke told Radio National that award wages go “all the way up to some people who are on significantly higher wages”, hinting the government could accept that not all workers should receive a rise in line with inflation.
“The principles that we dealt with last year was to say no government ever wants anyone to go backwards … we put forward the principle that the focus needed to be on the people on the lowest incomes because they had the least savings, they had the least room to move.”
Ley told reporters in Canberra the Coalition would “always support sustainable wages”.
“Remember, [Albanese] held up that dollar coin, he promised you’d see real wage rises under his government. So where are they?”
