The Fair Work Commission today handed down its decisions regarding wage increases, opting to defer the annual boost for hospitality staff until February 2021.
The FWC has faced interests more greatly polarised than normal, as entities representing workers and businesses made cases for prioritisation in the pending recession as the country re-awakens from the COVID-19 shutdown.
Unions were pushing for a four per cent rise in hourly rates, citing the increased costs of living and insecurity. Employer bodies argued for an outright freeze or delay to the pay rise until 1 January 2021, based on a need to protect jobs and consider the viability of businesses.
FWC panellist professor Mark Wooden, Fellow of Applied Economic & Social Research at Melbourne University, appointed in March by the attorney general, reportedly recommended “no increase” at all this year. He suggested growth of jobs and working hours should be prioritised over an increase in actual wages.
The result brings a compromise by the FWC, a majority electing to order a 1.75 per cent increase (around $13 per week), with staggered implementation across industries.
This will make the new minimum wage $753.80 per week, being $19.84 an hour, for over $2.2 million Australians with pay set by Awards.
Essential service workers, including healthcare, social assistance, teachers and childcare, will get their increase from 1 July.
Industries such as construction and manufacturing will see their increase from 1 September.
The industries deemed hardest hit by the pandemic, notably hospitality, retail, recreation and tourism, will not get the minimum wage increase until 1 February.
Timing of the staggered rollout was calculated around data on the sectors more impacted by the COVID-19 restrictions.
The national AHA and Tourism Accommodation Australia had argued for deferral of any annual wage increase “to help provide additional support to businesses who are only just beginning to reopen after extended COVID-19 restrictions”, and both welcome the diplomatic solution.
“The reprieve offered by the Commission today will provide hospitality businesses with the extra breathing room they need as the industry seeks to recover from months of zero revenue,” offers AHA National CEO Stephen Ferguson.
Hospitality industry bodies have warned of a looming “debt cliff” and surge in unemployment if the JobKeeper program is cut at the scheduled termination date of 25 September. Despite mixed results in its take-up, research by the AHA found many operators are still relying on it to keep many of their workers employed.
“As an association we remain firmly focused on ensuring that the JobKeeper Payment scheme is extended for Australia’s hospitality industry,” added Ferguson.
“This extension is absolutely essential – failure to do so will result in the loss of many jobs across our sector and we will also see a significant reduction in hours for remaining employees.”
The following Awards have had the 1.75 per cent increase delayed until the first full pay period commencing on or after 1 February 2021:
- Hospitality Industry (General) Award 2020
- Restaurant Industry Award 2020
- Alpine Resorts Award 2020
- Amusement, Events and Recreation Award 2020
- Fast Food Industry Award 2010
- Marine Tourism and Charter Vessels Award 2020
- Registered and Licensed Clubs Award 2010
