$10.26 for lowest-paid Australians

‘Fair Pay’ Commission sings employers` tune

Business got what it wanted from the Howard government’s Fair Pay Commission when it served up the lowest increase in minimum wages for 10 years.

The minimum wage will go up by $10.26 a week to $522.12 from 1 October, as a result of last month’s decision.

The decision affects the purchasing power of 1.2 million workers and their dependants.

It means that nurses working under the federal industrial relations system and whose rates of pay are governed by a preserved state award will get an increase.

This includes the majority of nurses working in the aged care sector who are covered by the preserved Nursing Homes &c. Nurses (State) Award.

Nurses working in other parts of the private sector may also be entitled to an increase. If your conditions have moved onto a federal system workplace agreement and no longer a preserved award you should talk to the NSWNA about whether the increase will apply to you.

The increase will be 27 cents per hour for nurses currently earning less than $700 per week and 14 cents per hour for nurses currently earning more than $700 per week. The increase will take effect from the first pay period on or after 1 October 2007.

Employer groups asked the commission to award around $10 a week and that’s what they got, despite the ACTU mounting a strong argument for $28.

Employers’ spokesperson Heather Ridout said the ‘fair and responsible’ decision was exactly what her Australian Industry Group had lobbied for.

‘In our submission, the Group proposed a wage increase of 27 cents per hour ($10.26 per week) and three months lead time between the date of the decision and the date of operation,’ Ridout said.

‘This is what the Fair Pay Commission has delivered to lower-income employees today,’ she boasted.

One employer, the St Vincent de Paul Society, refused to stick to the script, announcing it would give its 1,000 employees in NSW and the ACT a $30 a week increase.

The society’s state president, John O’Neill, said $10.26 was ‘grossly unfair when compared with the huge increases paid to executive employees in corporate Australia’.

Several church representatives also condemned the $10.26 increase. The chairman of the Australian Catholic Council for Employment Relations, Brian Lawrence, said it was unfair on working families and based on incorrect calculation of family incomes.

The five Howard government-appointed members of the Fair Pay Commission – a Macquarie Bank director, the owner of a furniture removal company, two academic economists and a former workers’ compensation conciliator – claimed that a higher increase would push up inflation and interest rates.

As the ACTU pointed out, the $10.26 increase is actually below the rate of inflation, meaning the living standards of the lowest-paid Australians will go backwards.

ACTU President Sharan Burrow described the decision as a slap in the face for hard-working Australians and their families who were facing rising petrol prices, rents, childcare and education costs.

‘At the same time as they are facing increases in the cost of living, many workers have lost their job security and award conditions such as penalty rates, overtime pay, allowances and public holiday pay under the federal government’s new IR laws,’ she said.

ACTU Secretary-elect Jeff Lawrence pointed out: ‘People employed as cleaners, security guards, retail assistants, childcare workers and production workers are working hard and struggling to keep their heads above water. They will be left further behind by this decision.’

For big business, Australia’s economy has rarely been better. Company profits are extremely healthy, the stock market is at record highs and executive salaries are skyrocketing.

The share of national income going to company profits rose from less than 24% of GDP in 1996 to 28% last year.

On the other hand, the share of national income going to wages is at a 35-year low, having fallen from 56% to under 54% of GDP in the same decade.

The highly regarded economics commentator for The Age newspaper, Kenneth Davidson, calculates that if the wages share had remained constant over the period, the average wage earner would be some $2,300 a year — or $44 a week — better off than they are now.

It’s a trend Davidson deplores, and one which the Fair Pay Commission appears determined to encourage.

Who gets what?
Examples: New minimum hourly rate of pay under preserved Nursing Homes Nurses’ Award Increase per hour
Aged Care AIN Year 1 $15.65 up 27 cents per hour
Aged Care AIN Thereafter $17.08 up 27 cents per hour
Aged Care EN Year 1 $18.86 up 14 cents per hour
Aged Care EN Thereafter $20.30 up 14 cents per hour
Aged Care RN Year 5 $25.71 up 14 cents per hour
Aged Care RN Year 8 $29.36 up 14 cents per hour