State government succeeds in freezing public sector wages
Future public sector pay rises will be negotiated yearly, after the IRC effectively backed the government in freezing public servants’ wages to direct $2.5 billion to infrastructure projects to stimulate the economy.
NSW
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Future public sector pay rises will be negotiated yearly, after the Industrial Relations Commission effectively backed the government in freezing public servants’ wages to direct $2.5 billion to infrastructure projects to stimulate the economy in a move unions described as a “kick in the guts” to frontline workers.
The IRC decided public servants should not get a scheduled 2.5 per cent pay rise this year amid the coronavirus recession but said workers should get a 0.3 per cent wage increase to avoid an effective cut to their pay.
The decision is a win for the government, which took the wage case to the IRC after its bid to freeze public sector pay todirect almost $3 billion to infrastructure projects was blocked by Parliament.
The IRC declared that while the decision to effectively freeze public sector pay was not done lightly, it was persuaded “onbalance” by the “economic evidence” that a pay freeze was needed in the coronavirus recession.
Treasurer Dominic Perrottet welcomed the decision, saying it will help the government “provide people with a paycheck, not a pay rise”.
Following the decision, the government will save “around $2.5 billion”.
“They are dollars now that we can invest directly into infrastructure and into direct spending programs to drive jobs growthand drive economic growth across the state,” Mr Perrottet said.
Labor Leader Jodi McKay questioned how many jobs would be created by the $3 billion infrastructure program.
The government pay freeze was bitterly opposed by Labor and the Unions when it was first put forward in May. At the time, Labor turned down a one-off $1000 payment to frontline workers and a guarantee of no forced redundancies, offered by the governmentas a bargaining chip to get the pay freeze through parliament.
The jobs guarantee is now off the table, but it’s unlikely public servants will face the sack.
“The government is doing everything we can to keep as many people in work at this time,” Mr Perrottet said.
Future pay increases will now be assessed with view to the economic circumstances, and won’t go back to 2.5 per cent each year.
The IRC’s decision to provide a 0.3 per cent pay rise for public servants will cost the state government about $300 million.
“The Premier and Treasurer may as well walk around the state, throwing 20 cent pieces at public sector workers,” Unions NSW Secretary Mark Morey said.
Nursing union secretary Brett Holmes said the decision was “disgraceful”.
“We have an outcome that delivers (an extra) seven cents an hour for our lowest paid workers and the average nurse 14 cents an hour,” he said.
Workers may get the money in a lump sum payment, and it’s understood the Treasurer is also open to providing a lump sum paymentto workers greater than 0.3 per cent.
Lisa Barry, a Nurses union delegate at the Prince Of Wales Hospital, was in “disbelief” at the pay freeze.
“We were owed 2.5 per cent so we’re getting a pay cut,” she said.
The pay increase now recommended by the IRC amounted to “just one cup of coffee a week,” she said.
“We are on the front line, we’ve put ourselves at risk,” the operating theatre nurse said.
Prison worker Trish O’Brien said the outcome resulted in an effective pay cut after inflation.
A 0.3 per cent pay rise would see her take home just $200 extra each year.
“We’re in danger every day. And I think we need to be given praise for what we do,” she said.
STATE GOVERNMENT SUCEEDS IN FREEZING PUBLIC SECTOR WAGES
NSW public servants will receive a 0.3 per cent pay increase this year, with the Industrial Relations Commission effectively backing the state government in freezing pay increases for public sector workers.
The IRC recommended a 0.3 per cent pay increase to avoid public servants copping an effective reduction in their pay, which would have occurred as part of a total wage freeze.
In its judgment released this afternoon, the Industrial Relations Commission said awarding no pay increases would see public servants suffer a “reduction of 0.3 per cent” in their real wages which would not be “fair and reasonable”.
“The Full Bench proposes to make awards and variations to avoid such a reduction, by awarding increases of 0.3 per cent,” the judgment said.
Public servants may get a lump-sum payment instead of a 0.3 per cent increase, with the IRC inviting submissions on how the small pay rise should be delivered.
The government tried in May to freeze public servants’ wages and direct the $3 billion saved to infrastructure projects designed to create jobs.
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However the move was blocked by Parliament’s Upper House, with the government forced to seek the pay freeze through the IRC.
The IRC declared that while the decision to effectively freeze public sector pay was not done lightly, it was persuaded “on balance” by the “economic evidence” that a pay freeze was needed in the coronavirus recession.
The judgment said the economic environment “calls for restraint in the particular circumstances of the current financial year”.
The full bench of the Industrial Relations Commission handed down its highly anticipated judgment on public servants’ pay this afternoon, after the government was forced to seek a pay freeze through the courts.
Unions had argued that public servants should not have to cop a pay freeze, and should be awarded the 2.5 per cent pay increase originally planned for this year.
Earlier, Premier Gladys Berejiklian had warned public servants might lose their jobs if the government didn’t get the outcome it wanted in the IRC.
“What we wanted to do was make sure that every single public servant knew that they had the job. But if we have to find extra billions of dollars over the next few years, it makes that very difficult,” she said.
Originally published as State government succeeds in freezing public sector wages