Minimum wage review: Cautious approach needed


Fair Work Australia should take a cautious approach this year in adjusting minimum wages, the Australian Industry Group warns. 

“While the economic recovery is underway and conditions are much improved on where they were at the time of the last minimum wage case, conditions are patchy and being too ambitious would risk the jobs of the very people that the Wage Review is intended to help," AiG chief executive Heather Ridout said.

"The underemployment rate remains high (7.6 per cent) with 872,600 people looking to work more. Profitability across large sectors of the economy is weak while the future is far from certain.

In a submission to Fair Work Australia, Ai Group has called for a $12 increase in the Federal Minimum Wage to $555.78, effective July 1. Award minimum wages should be increased by the same amount.

The exceptional circumstances provisions of the Fair Work Act should be invoked for employers in particular industries or parts of industries that are faced with large cost increases on July 1 as a result of award modernisation.  For those employers, Ai Group proposes an operative date of January 1, 2011 for the $12 increase – a six month delay.

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