The federal government has called on the Fair Work Commission to ensure that the wages of low-income workers do not fall in its argument about a possible increase in the minimum wage.
The government submitted its six-page submission to the committee Friday afternoon as the agency assesses whether the minimum wage should rise above its current $20.33 an hour.
After rising inflation, the highest in two decades, Labor Secretary Tony Burke said the government is ready to fight for better worker wages.
“Keeping wages low is no longer a position of the government of Australia; we want to make sure wages can move, and the first step of that has been taken today,” Burke told reporters in Sydney.
“We made it clear to the Fair Work Commission in its annual wage review that the government’s position is that we don’t want low-paid workers to decline.”
While the entry doesn’t show how much the minimum wage should increase, the consumer price index has risen to 5.1 percent, 2.7 percentage points ahead of wage growth.
The government’s submission read: “When considering its decision on wages for this year, the government recommends that the Fair Work Commission ensure that the real wages of Australia’s low-paid workers do not decline.”
“High and rising inflation and weak wage growth are driving down real wages across the economy and creating pressure on the cost of living for low-paid workers.”
The government said it would not suggest that wages should automatically increase with inflation.
“Current economic conditions are highly unusual and challenging, and the government’s entry specifically addresses the low-paid and in the current macroeconomic context,” the entry said.
“Maintaining the relative standard of living of low-paid workers is not expected to have a material impact on employment.”
The government said in its submission that the commission had raised the minimum wage in line with or above inflation in nine of the past ten years.
During the election, Prime Minister Anthony Albanese said he would “absolutely” support a 5.1 percent increase in the minimum wage.
Mr. Burke said the submission was not limited to the one on the minimum wage, also referring to low-paid workers.
“They are largely the heroes of the pandemic … We are also talking about people with prices close to minimum wage,” he said.
“We don’t want anyone to back down, but there is a particular priority right now regarding low-paid workers.”
The submission noted that current pressures on the cost of living would disproportionately impact low-paid workers.
“A more substantial increase for those on low wages would be beneficial in narrowing the gender pay gap,” the entry said.
“Supporting a more substantial raise for low-paid workers will also help maintain the relative standard of living of the low-paid.”
Other bodies have until Wednesday to submit a response to the cabinet position.
In its submission to the Fair Work Commission, the Australian Council of Trade Unions had called for a 5.5 percent increase in the minimum wage.
The committee is expected to make its final decision before the end of the month.
