CFMEU’s Lowe blow: we won’t hold back on pay

Union dismisses Reserve Bank Governor Philip Lowe as ‘hopelessly out of touch’.

Zach Smith is the new national CFMEU construction division secretary. Aaron Francis / The Australian

The CFMEU has vowed to pursue pay rises of more than 5 per cent for workers caught in the “brutal cost-of-living storm”, dismissing Reserve Bank governor Philip Lowe as “hopelessly out of touch”.

Union leaders renewed their attacks on Dr Lowe after he said there would be concern if the 5.75 per cent pay rise granted to low-paid workers by the Fair Work Commission became a “benchmark” for private sector ­enterprise agreements.

CFMEU national secretary Zach Smith said the union would fight hard for significant wage rises. “There will be situations where our union will pursue claims over 5 per cent,” he said. “That’s because workers deserve a pay rise to deal with this extraordinary inflationary crisis. Workers shouldn’t have their capacity to earn decent money limited by ­failed neoliberal economics.”

The CFMEU’s construction division has traditionally been a national pacesetter for private sector wage increases, securing ­annual 5 per cent pay rises in ­commercial construction before the pandemic.

The union’s Victorian secretary, John Setka, told The Australian in May that he expected construction workers to take ­industrial action in pursuit of pay rises of at least 5 per cent.

Mr Smith said on Wednesday that Dr Lowe was “hopelessly out of touch”. “First he smashed workers with interest rate rises, now he’s saying they shouldn’t get a pay rise,” he said.

“Working people shouldn’t be expected to take yet another hit while massive corporations rake in outrageous super-profits.

“This obsession with wage ­restraint for workers needs to end. We know corporate profits are fuelling inflation. People are sick and tired of the broken economic orthodoxies that insist workers must always suffer.”

ACTU secretary Sally McManus accused the “cruel” business lobby of wrongly blaming low-paid workers for inflation.

She said the annual pay rise for minimum wage workers did not flow on to other workers.

“Last year’s minimum pay rise was 5.2 per cent and it made almost no difference to inflation,” she said.

“According to the Centre for Future Work, 70 per cent of the rise in inflation above the RBA’s target of 2.5 per cent was due to business profits.

“It also is very difficult for workers to win pay rises, another fact that appears not well understood by some.”

Ms McManus said winning pay rises was hard, but decisions to put prices up to inflate profits was not.

“Workers are bearing the brunt of inflation and the increasing ­interest rates,” she said. “The fact that the business lobby and the Liberal opposition are blaming low-paid workers for inflation is not only outdated, but cruel and ideological. It doesn’t matter how much evidence there is that profits are part of causing inflation – not the low paid – big business and their cheer squad will always campaign for lower wages, even as people are struggling to pay for groceries and rent.”

United Workers Union national secretary Tim Kennedy said the union was generally achieving annual wage increases ranging from 3 per cent to 4.5 per cent in new enterprise agreements.

“I could probably point to my one hand where we have had agreements that deliver six per cent per annum.

“Employers are making bargaining very hard for workers to do and where employers are engaged in collective bargaining, it’s still from a mindset of concessions, not taking into account the enormous profits that corporations are generating and sharing that with their workforce. It’s a hard, long term, debilitating process and so you are not going to see across the economy a wage breakout in terms of 5.75 (per cent) setting a benchmark. The system doesn’t work like that anymore.”