National minimum wage to increase by 3.5 per cent from July 1

FROM July 1, about 2.3 million workers will get a pay increase. But some people still aren’t happy.

AUSTRALIA’S lowest paid workers will receive a 3.5 per cent pay increase.

From July 1, the national minimum wage will increase by $24.30 per week to $719.20, or $18.93 an hour, the Fair Work Commission has ruled in its 2017-18 Annual Wage Review. The current national minimum wage is $18.29 per hour or $694.90 per 38-hour week.

The casual loading will remain at 25 per cent. An estimated 2.3 million workers are on the minimum wage, or about 22.7 per cent of all employees.

“The panel’s decision will also affect employees paid close to the national minimum wage rate and modern award rates and whose pay is set by a collective agreement which is linked to the outcome of the review,” the commission said in its decision.

“The assessment of the needs of the low paid requires an examination of the extent to which low-paid workers are able to purchase the essentials for a decent standard of living and to engage in community life, assessed in the context of contemporary norms. The risk of poverty is also relevant in addressing the needs of the low paid.”

Australian Retailers Association executive director Russell Zimmerman said the decision was “not sustainable”. “The ARA put in a submission for a 1.9 per cent increase,” he said. “We consulted widely with the sector and they came back and said the increase should be no greater than inflation.”

Mr Zimmerman said the ARA would have liked to see employment growth of 4 per cent in the retail sector, but with the 3.5 per cent pay increase he didn’t believe that would happen.

He warned retailers would be forced to either reduce hours or staff numbers as a result. “With the current state of retail and store closures we’ve seen over the last couple of months, we don’t believe it’s the correct decision by the Fair Work Commission,” he said.

The Australian Council of Trade Unions had been pushing for a $50 a week rise to $744.90, equivalent to 7.2 per cent. ACTU secretary Sally McManus said the increase was a “step in the right direction” but that the minimum wage should be pegged at 60 per cent of the median wage.

“That is what’s required to ensure that every full-time worker in Australia can survive on their wage,” she said in a statement.

“We have to change the rules on the minimum wage. People who have been forced into poverty by the inadequacy of this wage should not have to wait every year to see if they will be saved by the Fair Work Commission. The minimum wage should be set to keep pace with wages.

“Moving towards a ‘living wage’ would help mitigate widening income inequality. Rising income and wealth inequality is the challenge of our time. Tackling inequality will help resolve many of the fundamental economic and social problems we currently confront.”

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Originally published as National minimum wage to increase by 3.5 per cent from July 1