tag:theconversation.com,2011:/africa/topics/fair-work-commission-5129/articlesFair Work Commission – The Conversation2024-03-21T19:08:08Ztag:theconversation.com,2011:article/2262362024-03-21T19:08:08Z2024-03-21T19:08:08ZAged care workers have won a huge pay rise. What about the cleaners, cooks and admin staff who support them?<p>This month, the Fair Work Commission handed Australia’s aged care workforce an <a href="https://www.abc.net.au/news/2024-03-15/aged-care-workers-pay-rise-case-ends/103591208">historic pay rise</a>, with some groups’ wages set to increase by more than 28%. </p>
<p>The news was a welcome relief for much of the female-dominated workforce, who have faced <a href="https://theconversation.com/todays-aged-care-falls-well-short-of-how-wed-like-to-be-treated-but-there-is-another-way-177067">chronic staffing shortages and poor rates of pay</a> in recent years. </p>
<p>But not everyone working in the aged care industry was counted equally. </p>
<p>A whole host of workers essential to running aged-care facilities – such as cooks, cleaning staff and administrative assistants – are included in what’s called the <a href="https://www.agedcareguide.com.au/talking-aged-care/providers-indirect-and-direct-care-workers-how-stage-three-will-impact-you">indirect care workforce</a>. Many of them will get a raise of just 3%. </p>
<p>Australia now risks continuing to leave behind this hardworking and often overlooked group. </p>
<h2>Who gets more</h2>
<p>Most direct care workers on the Aged Care Award – such as nurses and care staff – will see a big pay increase from July this year, inclusive of <a href="https://www.fwc.gov.au/documents/decision-summaries/2024fwcfb150-summary.pdf">an interim 15% raise </a> awarded in 2023. </p>
<p>For example, workers on Level 3 of the award will see an overall wage increase of approximately 23% year over year, while workers on Level 5 (holding Certificate 4 in Aged Care and Disability) will see their pay go up by 28.5%.</p>
<p>Experienced nursing assistants on the new Aged Care Award will also receive a pay increase of 23%.</p>
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<h2>Who gets left behind</h2>
<p>Running an aged care facility is a multifaceted operation. Approximately <a href="https://helloleaders.com.au/article/aged-care-workers-could-see-28-pay-boost-indirect-care-workers-left-behind">100,000 residential aged care workers</a> are in “indirect care” roles, working across administrative and clerical services, food services, and laundry.</p>
<p>In its <a href="https://www.fwc.gov.au/documents/decision-summaries/2024fwcfb150-summary.pdf">decision</a>, the commission ruled that a “fundamental difference” between the work of direct and indirect care workers meant they did not deserve an equal pay increase.</p>
<p>The expert panel <a href="https://www.fwc.gov.au/documents/decision-summaries/2024fwcfb150-summary.pdf">said</a>: </p>
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<p>Without diminishing the importance of the work of indirect care for the proper functioning of residential aged care facilities, the above workers do not perform work equivalent in value to the direct care workers. </p>
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<p>For many workers in the areas of infection prevention and control, as well as some indirect workers in dementia wards, it awarded a pay increase of just 3%. </p>
<p>Other segments of the indirect care workforce received greater recognition. Laundry hands, cleaners and food service assistants who interact directly with residents saw this extra contact acknowledged, and won a raise of about 7%. </p>
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<img alt="A list of the aged care workforce, showing the direct care workforce is about 320,000 people and the indirect care workforce is about 100,000 people" src="https://images.theconversation.com/files/583350/original/file-20240321-16-1dhogn.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/583350/original/file-20240321-16-1dhogn.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=600&fit=crop&dpr=1 600w, https://images.theconversation.com/files/583350/original/file-20240321-16-1dhogn.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=600&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/583350/original/file-20240321-16-1dhogn.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=600&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/583350/original/file-20240321-16-1dhogn.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=754&fit=crop&dpr=1 754w, https://images.theconversation.com/files/583350/original/file-20240321-16-1dhogn.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=754&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/583350/original/file-20240321-16-1dhogn.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=754&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
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<span class="attribution"><span class="source">The Conversation</span>, <a class="license" href="http://creativecommons.org/licenses/by-sa/4.0/">CC BY-SA</a></span>
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<h2>A widening pay divide impacts quality of care</h2>
<p>At 3%, the lowest pay increase for this group is below the <a href="https://www.rba.gov.au/inflation-overview.html">current Australian inflation rate</a> of 4.1%. For them, increases in take-home pay will fail to meet the rising cost of living. 7% is only slightly higher, and just a fraction of the raises awarded in direct care. </p>
<p>Pay disparity in the treatment of indirect care workers could further entrench a serious equity divide, the impacts of which we may already be seeing. </p>
<p>At large provider BaptistCare NSW and ACT, employee turnover among direct care workers <a href="https://www.theweeklysource.com.au/sector-moves-people/direct-care-worker-turnover-drops-after-pay-rise-but-indirect-worker-turnover-remains-stubbornly-at-38">fell by about 6%</a> after last year’s interim pay rise, to 29.3%. But among their indirect care colleagues who did not receive the raise, turnover remained stubbornly high, above 38%.</p>
<p>High staff turnover poses a serious challenge to delivering quality aged care. </p>
<p>By influencing attitudes at work, the pay divide could also be exerting a profound influence on the quality of care delivered. </p>
<p>BaptistCare NSW & ACT has shared <a href="https://www.theweeklysource.com.au/sector-moves-people/direct-care-worker-turnover-drops-after-pay-rise-but-indirect-worker-turnover-remains-stubbornly-at-38">anecdotal reports</a> that indirect care staff have become less willing to assist their higher paid colleagues.</p>
<p>Australia cannot afford further negative influences on its aged care sector. </p>
<p>It hasn’t been long since the <a href="https://www.abc.net.au/news/2019-10-31/aged-care-royal-commission-report-finds-unsafe-industry/11658328">Royal Commission into Aged Care found</a> the “unkind and uncaring” system had failed to meet the needs of elderly people, and could even be neglecting them. </p>
<p>Pay rises for direct care workers are an important step in improving the quality of our aged care offering. But we could risk it all if we continue to leave part of its workforce behind.</p>
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Read more:
<a href="https://theconversation.com/who-will-look-after-us-in-our-final-years-a-pay-rise-alone-wont-solve-aged-care-workforce-shortages-225898">Who will look after us in our final years? A pay rise alone won't solve aged-care workforce shortages</a>
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<p class="fine-print"><em><span>Matthew Xerri is affiliated with the Centre for Work, Organisation, and Wellbeing at the Griffith Business School, Griffith University. </span></em></p>Most of the indirect care workforce will only see a pay rise between 3% and 7%.Matthew Xerri, Senior Lecturer in Human Resources, Griffith UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/2258982024-03-18T02:53:31Z2024-03-18T02:53:31ZWho will look after us in our final years? A pay rise alone won’t solve aged-care workforce shortages<figure><img src="https://images.theconversation.com/files/582419/original/file-20240318-28-8rjewg.jpg?ixlib=rb-1.1.0&rect=293%2C173%2C6948%2C4191&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">
</span> <span class="attribution"><a class="source" href="https://www.shutterstock.com/image-photo/happy-elderly-woman-talking-friend-sitting-1641889408">Aila Images/Shutterstock</a></span></figcaption></figure><p>Aged-care workers will receive a significant pay increase after the Fair Work Commission <a href="https://www.fwc.gov.au/documents/decisionssigned/pdf/2024fwcfb150.pdf">ruled</a> they deserved substantial wage rises of up to 28%. The federal government <a href="https://ministers.dewr.gov.au/burke/fair-work-decision-aged-care">has committed to</a> the increases, but is yet to announce when they will start. </p>
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<p>But while wage rises for aged-care workers are welcome, this measure alone will not fix all workforce problems in the sector. The number of people over 80 is expected to <a href="https://treasury.gov.au/sites/default/files/2023-08/p2023-435150.pdf">triple over the next 40 years</a>, driving an increase in the number of aged care workers needed.</p>
<h2>How did we get here?</h2>
<p>The Royal Commission into Aged Care Quality and Safety, which delivered its <a href="https://www.royalcommission.gov.au/aged-care/final-report">final report</a> in March 2021, identified a litany of tragic failures in the regulation and delivery of aged care. </p>
<p>The former Liberal government was dragged reluctantly to accept that a total revamp of the aged-care system was needed. But its <a href="https://www.health.gov.au/ministers/the-hon-greg-hunt-mp/media/respect-care-and-dignity-aged-care-royal-commission-452-million-immediate-response-as-government-commits-to-historic-reform-to-deliver-respect-and-care-for-senior-australians#:%7E:text=Minister%20for%20Senior%20Australians%20and,%2C%20dementia%2C%20food%20and%20nutrition.">weak response</a> left the heavy lifting to the incoming Labor government.</p>
<p>The current government’s response started well, with a <a href="https://theconversation.com/anthony-albanese-offers-2-5-billion-plan-to-fix-crisis-in-aged-care-180419">significant injection of funding</a> and a promising regulatory response. But it too has failed to pursue a visionary response to the problems identified by the Royal Commission.</p>
<p>Action was needed on four fronts:</p>
<ul>
<li>ensuring enough staff to provide care</li>
<li>building a functioning regulatory system to encourage good care and weed out bad providers </li>
<li>designing and introducing a fair payment system to distribute funds to providers and</li>
<li>implementing a financing system to pay for it all and achieve intergenerational equity.</li>
</ul>
<p>A government taskforce which proposed a <a href="https://theconversation.com/what-will-aged-care-look-like-for-the-next-generation-more-of-the-same-but-higher-out-of-pocket-costs-225551">timid response to the fourth challenge</a> – an equitable financing system – was released at the start of last week.</p>
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Read more:
<a href="https://theconversation.com/what-will-aged-care-look-like-for-the-next-generation-more-of-the-same-but-higher-out-of-pocket-costs-225551">What will aged care look like for the next generation? More of the same but higher out-of-pocket costs</a>
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<p>Consultation closed on a <a href="https://media.opan.org.au/uploads/2024/03/240308_Aged-Care-Act-Exposure-Draft-Joint-Submission_FINAL.pdf">very poorly designed new regulatory regime</a> the week before.</p>
<p>But the big news came at end of the week when the Fair Work Commission handed down a further <a href="https://www.fwc.gov.au/documents/decisionssigned/pdf/2024fwcfb150.pdf">determination</a> on what aged-care workers should be paid, confirming and going beyond a previous <a href="https://www.fwc.gov.au/documents/sites/work-value-aged-care/decisions-statements/2022fwcfb200.pdf">interim determination</a>. </p>
<h2>What did the Fair Work Commission find?</h2>
<p>Essentially, the commission determined that work in industries with a high proportion of women workers has been traditionally undervalued in wage-setting. This had consequences for both care workers in the aged-care industry (nurses and <a href="https://training.gov.au/Training/Details/CHC33021">Certificate III-qualified</a> personal-care workers) and indirect care workers (cleaners, food services assistants).</p>
<p>Aged-care staff will now get significant pay increases – 18–28% increase for personal care workers employed under the Aged Care Award, inclusive of the increase awarded in the interim decision. </p>
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<img alt="Older person holding a stabilising bar" src="https://images.theconversation.com/files/582420/original/file-20240318-26-tyvjf.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/582420/original/file-20240318-26-tyvjf.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/582420/original/file-20240318-26-tyvjf.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/582420/original/file-20240318-26-tyvjf.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/582420/original/file-20240318-26-tyvjf.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/582420/original/file-20240318-26-tyvjf.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/582420/original/file-20240318-26-tyvjf.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
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<span class="caption">The commission determined aged care work was undervalued.</span>
<span class="attribution"><a class="source" href="https://www.shutterstock.com/image-photo/elderly-woman-holding-on-handrail-safety-774216670">Shutterstock/Toa55</a></span>
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<p>Indirect care workers were awarded a general increase of 3%. Laundry hands, cleaners and food services assistants will receive a further 3.96% <a href="https://www.fwc.gov.au/documents/decision-summaries/2024fwcfb150-summary.pdf">on the grounds</a> they “interact with residents significantly more regularly than other indirect care employees”.</p>
<p>The final increases for registered and enrolled nurses will be determined in the next few months.</p>
<h2>How has the sector responded?</h2>
<p>There has been no push-back from employer groups or conservative politicians. This suggests the uplift is accepted as fair by all concerned. </p>
<p>The interim increases of up to 15% probably facilitated this acceptance, with the <a href="https://theconversation.com/what-does-the-budget-mean-for-medicare-medicines-aged-care-and-first-nations-health-192842">recognition of the community</a> that care workers should be paid more than fast food workers.</p>
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Read more:
<a href="https://theconversation.com/itll-take-more-than-15-to-beat-the-stigmas-turning-people-off-aged-care-206670">It'll take more than 15% to beat the stigmas turning people off aged care</a>
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<p>There was <a href="https://www.accpa.asn.au/media-releases/accpa-welcomes-further-aged-care-wage-rises">no criticism from aged-care providers</a> either. This is probably because they are facing difficulty in recruiting staff at current wage rates. And because government payments to providers reflect the <a href="https://www.ihacpa.gov.au/">actual cost of aged care</a>, increased payments will automatically flow to providers. </p>
<p>When the increases will flow has yet to be determined. The government is due to give its recommendations for staging implementation by mid-April.</p>
<h2>Is the workforce problem fixed?</h2>
<p>An increase in wages is necessary, but alone is not sufficient to solve workforce shortages. </p>
<p>The health- and social-care workforce is <a href="https://www.jobsandskills.gov.au/data/employment-projections">predicted</a> to grow faster than any other sector over the next decade. The “care economy” will <a href="https://theconversation.com/care-economy-to-balloon-in-an-australia-of-40-5-million-intergenerational-report-211876">grow</a> from around 8% to around 15% of GDP over the next 40 years.</p>
<p>This means a greater proportion of school-leavers will need to be attracted to the aged-care sector. Aged care will also need to attract and retrain workers displaced from industries in decline and attract suitably skilled migrants and refugees with appropriate language skills.</p>
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<img alt="Nursing students practise their skills" src="https://images.theconversation.com/files/582422/original/file-20240318-20-x7i1u3.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/582422/original/file-20240318-20-x7i1u3.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/582422/original/file-20240318-20-x7i1u3.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/582422/original/file-20240318-20-x7i1u3.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/582422/original/file-20240318-20-x7i1u3.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/582422/original/file-20240318-20-x7i1u3.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/582422/original/file-20240318-20-x7i1u3.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
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<span class="caption">Aged care will need to attract workers from other sectors.</span>
<span class="attribution"><a class="source" href="https://www.shutterstock.com/image-photo/nursing-students-learning-how-rescue-patients-1941429475">nastya_ph/Shutterstock</a></span>
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<p>The <a href="https://theconversation.com/demand-driven-funding-for-universities-is-frozen-what-does-this-mean-and-should-the-policy-be-restored-116060">caps on university and college enrolments</a> imposed by the previous government, coupled with weak student demand for places in key professions (such as nursing), has meant workforce shortages will continue for a few more years, despite the allure of increased wages. </p>
<p>A significant increase in intakes into university and vocational education college courses preparing students for health and social care is still required. Better pay will help to increase student demand, but funding to expand place numbers will ensure there are enough qualified staff for the aged-care system of the future. </p>
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Read more:
<a href="https://theconversation.com/changes-are-coming-for-australias-aged-care-system-heres-what-we-know-so-far-222757">Changes are coming for Australia's aged care system. Here's what we know so far</a>
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<p class="fine-print"><em><span>Stephen Duckett is Deputy Chancellor of RMIT University which i.a. provides education for the aged care sector.</span></em></p>While wage rises for aged care workers are welcome, this measure alone will not fix all workforce problems in the sector.Stephen Duckett, Honorary Enterprise Professor, School of Population and Global Health, and Department of General Practice and Primary Care, The University of MelbourneLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/2249492024-03-07T19:24:27Z2024-03-07T19:24:27Z2024 could be the year the Fair Work umpire properly values women’s work – here’s how<p>This International Women’s Day, it is time to call on Australia’s workplace umpire, the Fair Work Commission, to finally close the gender pay gap.</p>
<p>Half a century after the commission’s predecessor granted women “equal pay for equal work” in a <a href="https://atui.org.au/2020/06/16/the-1969-equal-pay-case/">landmark case</a> in 1969, the gap remains between <a href="https://www.wgea.gov.au/data-statistics/ABS-gender-pay-gap-data">12% and 21%</a>.</p>
<p>Amendments to the Fair Work Act by the incoming Labor government in 2022 gave it new tools to close the gap by addressing the undervaluation of work in traditionally female-dominated occupations.</p>
<p>If it uses these tools to their full potential, 2024 will be a landmark year in the genuine achievement of equal pay for equal work. </p>
<h2>What we’ve been doing hasn’t much worked</h2>
<p>Traditionally in Australia, addressing gender-based undervaluation has relied on two approaches. </p>
<p>The first has been to argue the business case for gender equality – convincing employers they’ll be rewarded for “<a href="https://theconversation.com/now-youre-able-to-look-up-individual-companies-gender-pay-gaps-224167">doing the right thing</a>”. </p>
<p>The second has been to bring equal pay cases to tribunals. </p>
<p>Unfortunately, neither approach has been successful. In particular, pushing for equal remuneration through tribunals has been time-consuming and expensive.</p>
<p>These tribunals, historically working on models of male full-time wage earners, have <a href="https://law.uq.edu.au/files/5960/Pay-equity.pdf">struggled</a> to understand the undervaluation of work performed predominantly by women. </p>
<h2>The commission’s new tools</h2>
<p>The commission’s <a href="https://www8.austlii.edu.au/cgi-bin/viewdoc/au/legis/cth/consol_act/fwa2009114/s3.html">act</a> has been rewritten to require it to </p>
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<p>promote job security and gender equality. </p>
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<p>It also has the power to make <a href="https://www8.austlii.edu.au/cgi-bin/viewdoc/au/legis/cth/consol_act/fwa2009114/s302.html">equal remuneration orders</a> either on its own initiative or on application in order to bring about equal pay for work of equal or comparable value. </p>
<p>A further new development is the establishment of <a href="https://www.dewr.gov.au/secure-jobs-better-pay/resources/establishing-two-new-expert-panels-fair-work-commission">expert panels</a> to assist in gender-related cases. Advice from gender experts should assist in overcoming historical gender biases in commission decisions. </p>
<p>Perhaps the most promising tool is the change to the commission’s <a href="https://www8.austlii.edu.au/cgi-bin/viewdoc/au/legis/cth/consol_act/fwa2009114/s134.html">modern awards objective</a>, which requires it to eliminate gender-based undervaluation of work and provide workplace conditions that facilitate women’s full economic participation each time it reviews an award.</p>
<p>Among other things, this requirement is likely to result in provisions that ensure part-time work is treated equally to full-time work and ensure a better balance between work and caring responsibilities.</p>
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Read more:
<a href="https://theconversation.com/qantas-pays-women-37-less-telstra-and-bhp-20-fifty-years-after-equal-pay-laws-we-still-have-a-long-way-to-go-223870">QANTAS pays women 37% less, Telstra and BHP 20%. Fifty years after equal pay laws, we still have a long way to go</a>
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<p>Amending awards is likely to be particularly important for women given that almost <a href="https://www.fwc.gov.au/documents/wage-reviews/2022-23/profile-of-employee-characteristics-across-modern-awards-2023-03-03.pdf">three in five</a> of the workers on awards are women. Men are mainly on negotiated agreements.</p>
<p>If the commission wanted to, it could hold a wide-ranging inquiry into the many factors that have contributed to gender-based undervaluation of women’s work. </p>
<p>It could also review entire industries and occupations that are female-dominated, upgrading multiple awards at the same time. This would avoid lengthy and costly reviews of individual awards.</p>
<h2>What’s likely in 2024</h2>
<p>The Fair Work Commission’s resolve to make lasting change will be tested by several matters currently before it. </p>
<p>The commission is due to issue its final decision in the case lodged by the Australian Nursing and Midwifery Federation, the Health Services Union, and the United Workers Union on the value of the work done by workers in <a href="https://www.fwc.gov.au/hearings-decisions/major-cases/4-yearly-review/awards-under-review/aged-care-award-review-am2014251">aged care</a>. </p>
<p>An initial <a href="https://www.fwc.gov.au/documents/sites/work-value-aged-care/decisions-statements/2022fwcfb200.pdf">interim decision </a> delivered in 2022 awarded some – but not all – of these workers a 15% increase, finding that work in feminised industries had been historically undervalued and the reason for that undervaluation is likely to be gender-based".</p>
<p>Workplace Relations Minister Tony Burke backed the decision, saying it was merely the “<a href="https://ministers.dewr.gov.au/burke/pay-rise-aged-care-workers">first step</a>”. </p>
<p>Another application, for nurses and midwives outside of aged care, was lodged by the Australian Nursing and Midwifery Federation in <a href="https://www.fwc.gov.au/hearings-decisions/major-cases/work-value-case-nurses-and-midwives">February this year</a>. </p>
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Read more:
<a href="https://theconversation.com/itll-take-more-than-15-to-beat-the-stigmas-turning-people-off-aged-care-206670">It'll take more than 15% to beat the stigmas turning people off aged care</a>
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<p>The commission has already started the process of grappling with gender-based undervaluation in modern awards, commissioning research that <a href="https://www.fwc.gov.au/documents/consultation/gender-based-occupational-segregation-report-2023-11-06.pdf">documents</a> the segregation of women and men into different occupations and industries.</p>
<p><a href="https://www.fwc.gov.au/documents/consultation/presidents-statement-stage-2-gender-pay-equity-2023-12-5.pdf">Further research</a> documenting the history of a select group of female-dominated modern awards and identifying the extent to which common elements indicate gender-based undervaluation, is due to be released in April. </p>
<p>It will feed into the <a href="https://www.fwc.gov.au/hearings-decisions/major-cases/annual-wage-reviews">annual wage review</a> due by the middle of the year.</p>
<h2>How to be bold</h2>
<p>Gender-based undervaluation of women’s work won’t be eradicated by incremental adjustments. </p>
<p>Here are three bold steps the commission could take: </p>
<ul>
<li><p>grant a minimum interim 12% increase (one estimate of Australia’s <a href="https://www.abs.gov.au/statistics/people/people-and-communities/gender-indicators">national gender pay gap</a>) across the board for female-dominated awards in this year’s annual wage review</p></li>
<li><p>develop new systems for classifying work and ascribing work value, breaking with the previous standards built around skills and qualifications in male dominated occupations </p></li>
<li><p>better consider the uneven bargaining power in industries such as nursing where governments fund care work and try to restrain costs.</p></li>
</ul>
<p>The changes to the Fair Work Act that allow <a href="https://www.fwc.gov.au/about-us/secure-jobs-better-pay-act-whats-changing/bargaining-support-6-june-2023/new-supported">multi-employer bargaining</a> are a start, but <a href="https://journals.sagepub.com/doi/full/10.1177/00221856231198880#bibr36-00221856231198880">unlikely alone</a> to correct the undervaluation of women’s work. </p>
<p>In female-dominated industries where collective bargaining is non-existent or ineffective, the commission should step in and further increase wages. </p>
<p>The Fair Work Commission has been given the tools. This should be the year it applies them.</p><img src="https://counter.theconversation.com/content/224949/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Lisa Heap is affiliated with the Centre for Future Work at the Australia Institute and is Secretary of the Association of Industrial Relations Academics Australia and New Zealand. </span></em></p>The Fair Work Commission has been given new tools. Among them is the power to eliminate gender-based undervaluation of work in entire awards and groups of awards.Lisa Heap, Doctoral Researcher RMIT University; Senior Researcher Centre for Future Work at the Australia Institute, RMIT UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/2113392023-08-10T19:59:50Z2023-08-10T19:59:50ZCan employers stop you working from home? Here’s what the law says<figure><img src="https://images.theconversation.com/files/542057/original/file-20230810-29-k9dewx.jpg?ixlib=rb-1.1.0&rect=0%2C0%2C7940%2C3773&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">
</span> <span class="attribution"><span class="source">Shutterstock</span></span></figcaption></figure><p>Zoom, the videoconferencing company whose fortunes soared with the pandemic-driven shift to working from home, has <a href="https://www.theguardian.com/technology/2023/aug/07/zoom-tells-staff-to-come-into-the-office-at-least-two-days-a-week">reportedly</a> told its staff to get back to the office – for at least two days a week, if the commute is no more than 80 kilometres. </p>
<p>It’s part of a trend of employers winding back the work-from-home flexibility that enabled most to keep operating through the pandemic in 2020 and 2021.</p>
<p>In Australia, close to 90% of employers have implemented mandatory in-office days, according to <a href="https://www.roberthalf.com.au/press/87-australian-companies-have-implemented-mandatory-office-days-staff">a survey of 300 hiring managers</a> commissioned by recruitment agency Robert Half. The survey shows 19% insisting on five days a week, 28% on four days, and 26% on three days. Almost a third of respondents reported at least one employee quitting in response.</p>
<p>Particularly for parents and younger workers, working from home is not something they will readily give up. </p>
<p>Which raises the question: can an employer, having first directed you to work from home, now turn around and mandate you don’t?</p>
<p>In many cases, the short answer is yes – though some people have a stronger case to argue for flexible work – and correct procedures must be followed. </p>
<h2>Is it a ‘lawful and reasonable’ direction?</h2>
<p>Whether you are employed permanently, as a casual or on a short-term contract, you are required to follow “lawful and reasonable” directions from your employer. Even if this isn’t stated specifically anywhere, Australian courts have ruled this requirement is “implied” in every employment contract. </p>
<p>A direction to return to the workplace will be lawful and reasonable except in extreme cases – for example, where it is contrary to a government directive or another law. </p>
<p>If you can perform your role at home and have a legitimate reason to do so – such as an underlying health issue – you may have grounds to argue a directive to return to the office is not reasonable.</p>
<p>But a detailed and considered plan requiring employees to return to the workplace safely will be lawful and reasonable. Failing to comply with this direction may be a valid reason for disciplinary action, including dismissal. </p>
<h2>Is consultation required?</h2>
<p>If your work is covered by an award or enterprise agreement, you can collectively assert your right to be consulted, on the basis that a return-to-work order constitutes a “major workplace change”. </p>
<p>The Fair Work Ombudsman <a href="https://www.fairwork.gov.au/tools-and-resources/best-practice-guides/consultation-and-cooperation-in-the-workplace">says consultation</a> requires giving notice, discussing the proposed changes, providing written information and giving “prompt consideration” to any matters raised by employees and their representatives.</p>
<p>Even though the employer ultimately doesn’t need consent, the consultation still needs to be genuine and properly consider employees’ views, following the processes set down in the applicable award or agreement. </p>
<p>This is the issue in the dispute over the Commonwealth Bank of Australia directing employees to be in the office 50% of the time. The Finance Sector Union is challenging this in the <a href="https://www.theguardian.com/news/2023/jul/12/commonwealth-bank-wfh-office-rule-union-dispute-work-from-home">Fair Work Commission</a>, arguing the bank breached its obligation to consult. So even if the commission agrees, the policy won’t necessarily change.</p>
<h2>What about flexible work arrangements?</h2>
<p>If your award, enterprise agreement or employment contract contains “workplace flexibility” provisions, you may have rights to work from home or to make a request. </p>
<p>In addition, the national employment standards under the Fair Work Act give employees the right to request “flexible work arrangements” if they’ve been with the employer for at least 12 months, and: </p>
<ul>
<li>are a parent or carer of a child of school age or younger </li>
<li>a carer<br></li>
<li>have a disability </li>
<li>are at least 55 years of age<br></li>
<li>are pregnant </li>
<li>are experiencing family or domestic violence, or caring or supporting an immediate family or household member experiencing family or domestic violence.<br></li>
</ul>
<p>Casual employees have similar rights if they have been working regularly and systematically for at least 12 months and have a reasonable expectation of continued work on the same basis. </p>
<p>Employers who get a request for flexible working arrangements need to respond in writing <a href="https://www.fairwork.gov.au/employment-conditions/flexibility-in-the-workplace/flexible-working-arrangements">within 21 days</a>.</p>
<p>An employer can only refuse a request on “reasonable business grounds”, and where they have genuinely tried to agree to alternative arrangements to accommodate the employee’s circumstances, and have considered the consequences for any refusal. </p>
<p>Reasonable business grounds include such factors as the size and nature of the business. These include the request being too costly and having a significant adverse effect on efficiency, productivity or customer service. </p>
<p>As of June 6 2023, employees have had a right of appeal to the Fair Work Commission, which has new, more expansive powers to resolve such disputes by mediation or conciliation, or by making a recommendation, and, if required, by arbitration. </p>
<h2>Reasonable adjustments for employees</h2>
<p>The right of review for flexible work arrangement requests, though limited to certain employee categories, could well become a hotly contested area.</p>
<p>If an organisation mandates their workers return to the workplace – whether exclusively or in part – the employer needs to provide clear guidelines. The “humane way” to introduce such a policy (regardless of any legal requirement) is to consult with employees over the change. </p>
<p>If an employee seeks a flexible work arrangement, the employer needs to actively engage with them and give them opportunities to provide supporting evidence regarding any special circumstances. That way, they can accommodate employees – so far as is practicable – and if required, make reasonable adjustments. </p>
<p>In sectors with persistent labour shortages, employees will have more leverage to have their views heard and negotiate and, in some cases, even request a review.</p>
<p><em>* If you’re an employee <a href="https://www.fairwork.gov.au/employment-conditions/flexibility-in-the-workplace#ways-to-request-flexible-working-arrangements">wanting to request</a> flexible working arrangements, such as working from home, or an employer wondering <a href="https://www.fairwork.gov.au/employment-conditions/flexibility-in-the-workplace/flexible-working-arrangements">how to handle</a> such requests, you can read more at <a href="https://www.fairwork.gov.au/employment-conditions/flexibility-in-the-workplace">the Fair Work Ombudsman</a>.</em></p><img src="https://counter.theconversation.com/content/211339/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Giuseppe Carabetta does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>If an organisation mandates their workers return to the workplace – whether exclusively or in part – it needs to provide clear guidelines.Giuseppe Carabetta, Associate Professor, University of Technology SydneyLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/2066702023-06-13T06:05:56Z2023-06-13T06:05:56ZIt’ll take more than 15% to beat the stigmas turning people off aged care<figure><img src="https://images.theconversation.com/files/531540/original/file-20230613-15-xoaghj.jpg?ixlib=rb-1.1.0&rect=0%2C939%2C5742%2C2888&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">
</span> <span class="attribution"><span class="source">Shutterstock</span></span></figcaption></figure><p>Aged care workers will see their award wages increase <a href="https://www.fairwork.gov.au/newsroom/news/15-per-cent-wage-increase-aged-care-sector">by 15% at the end of this month</a>. It’s recognition that their work has been undervalued, and that something needs to be done to solve the looming critical shortage of aged care workers as the population ages. </p>
<p>Higher wages was <a href="https://theconversation.com/4-key-takeaways-from-the-aged-care-royal-commissions-final-report-156109">a key recommendation</a> of the aged care royal commission. But how much money is enough to compensate for the stigma associated with aged care work? </p>
<p>Our <a href="https://academic.oup.com/gerontologist/article/62/7/994/6501332">research</a> shows that aged care work is burdened by three types of stigma – physical, social and moral. </p>
<p>Physical stigma refers to work performed under particularly dangerous conditions, or being exposed to dirt, bodily fluids and death. Examples of jobs with high physical stigma include firefighting, working with sewage and being an undertaker. </p>
<p>Social stigma is associated with <a href="https://www.emerald.com/insight/content/doi/10.1108/PR-08-2017-0244/full/html">work</a> seen as low-status, because it involves being in a servile relationship and working with people belonging to marginalised group – in this case, older people. </p>
<p>Moral stigma involves work that is viewed as deceptive or unethical. Examples include used car salespeople and loan sharks. Our findings point to a moral stigma around aged care work, which is reinforced by media coverage of elder abuse and neglect.</p>
<p>All three stigmas put aged care work in a select group of maligned occupations. Higher wages may ameliorate some of these stigmas, but more will be needed to address them all.</p>
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Read more:
<a href="https://theconversation.com/overseas-recruitment-wont-solve-australias-aged-care-worker-crisis-189126">Overseas recruitment won't solve Australia's aged care worker crisis</a>
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<h2>Physical, social and moral stigmas</h2>
<p>Our research is based on surveying 159 health professionals who do not currently work in aged care about their perceptions of the sector and the work. </p>
<p>Many occupations are stigmatised. For example, being a miner carries a high physical stigma, a welfare worker a social stigma, and a real estate agent a moral stigma. </p>
<figure class="align-center ">
<img alt="Care worker helping man from wheelchair to bed." src="https://images.theconversation.com/files/531516/original/file-20230613-25-wcvsxn.jpg?ixlib=rb-1.1.0&rect=0%2C0%2C5751%2C2880&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/531516/original/file-20230613-25-wcvsxn.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/531516/original/file-20230613-25-wcvsxn.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/531516/original/file-20230613-25-wcvsxn.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/531516/original/file-20230613-25-wcvsxn.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/531516/original/file-20230613-25-wcvsxn.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/531516/original/file-20230613-25-wcvsxn.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
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<span class="caption">Reports of abuse and neglect have contributed to a moral stigma of aged care work.</span>
<span class="attribution"><span class="source">Shutterstock</span></span>
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</figure>
<p>Some occupations have two strong stigmas, such as being a prison guard (physical and social stigma), being in the military (physical and moral stigma), or being a debt collector (social and moral stigma). The following graph shows how US researchers Blake Ashforth and Glen Kreiner categorised different occupations in their 2014 study, <a href="https://psycnet.apa.org/record/2014-09760-008">“Dirty work and dirtier work: Differences in countering physical, social and moral stigma”</a>. </p>
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<figure class="align-center zoomable">
<a href="https://images.theconversation.com/files/531538/original/file-20230613-17-wcvsxn.png?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="Examples of physical social and or moral dirty work." src="https://images.theconversation.com/files/531538/original/file-20230613-17-wcvsxn.png?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/531538/original/file-20230613-17-wcvsxn.png?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=590&fit=crop&dpr=1 600w, https://images.theconversation.com/files/531538/original/file-20230613-17-wcvsxn.png?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=590&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/531538/original/file-20230613-17-wcvsxn.png?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=590&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/531538/original/file-20230613-17-wcvsxn.png?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=742&fit=crop&dpr=1 754w, https://images.theconversation.com/files/531538/original/file-20230613-17-wcvsxn.png?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=742&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/531538/original/file-20230613-17-wcvsxn.png?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=742&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
<figcaption>
<span class="caption">Examples of physical social and or moral dirty work categorised by Blake Ashforth and Glen Kreiner.</span>
<span class="attribution"><a class="source" href="https://www.cambridge.org/core/journals/management-and-organization-review/article/abs/dirty-work-and-dirtier-work-differences-in-countering-physical-social-and-moral-stigma/3872AF1374E73E3C6D45139E691E6883">Management and Organization Review</a>, <a class="license" href="http://creativecommons.org/licenses/by/4.0/">CC BY</a></span>
</figcaption>
</figure>
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<p>Our research shows that aged care work carries the burden of all three stigmas.</p>
<h2>How can higher wages help?</h2>
<p>Attracting more people to aged care work requires challenging all three of these stigmas. The question is to what extent higher wages can do this. </p>
<p>It’s generally the case that <a href="https://onlinelibrary.wiley.com/doi/full/10.1111/1467-8551.12272">higher pay</a> means higher occupational prestige.</p>
<p>Higher pay can’t reduce physical stigma, but it can compensate for it – just as high salaries compensate people willing to do <a href="https://www.abc.net.au/news/2021-04-01/gold-fields-big-pay-rise-for-wa-/100045834">mining work</a>. </p>
<p>It can certainly help to diminish the social stigma, by signalling that society values this work more than <a href="https://doi.org/10.1111/j.1468-0432.2010.00512.x">it has done in the past</a>. But the relatively small wage increase will not overcome the fact that society puts greater value on occupations that focus on <a href="https://onlinelibrary.wiley.com/doi/10.1111/jan.15623">“curing” rather than “caring”</a>. </p>
<p>Higher pay may reduce the moral stigma, but only if other royal commission recommendations regarding better training and management are also implemented. The cases of abuse and neglect highlighted in media stories aren’t just about “bad apples”, but <a href="https://agedcare.royalcommission.gov.au/publications/final-report">broader systemic issues</a> such as staffing ratios and time allocated to direct care. </p>
<p>More fundamentally, the stigmatisation of aged care work reflects a structural deficiency of the economy, which fails to celebrate and remunerate caring work. </p>
<p>The federal government has taken a number of steps to address this, including giving the Fair Work Commission greater powers to address systemic low payment of female-dominated work, and expanding the potential for <a href="https://theconversation.com/what-the-compromise-ir-deal-means-for-wage-negotiations-and-pay-rises-195545">multi-enterprise enterprise bargaining</a>. </p>
<p>But much more will need be done before all care work is valued the way it needs to be.</p>
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Read more:
<a href="https://theconversation.com/wages-and-women-top-albaneses-ir-agenda-the-big-question-is-how-labor-keeps-its-promises-183527">Wages and women top Albanese's IR agenda: the big question is how Labor keeps its promises</a>
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<img src="https://counter.theconversation.com/content/206670/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Asmita Manchha is employed as a Research Fellow in the Bolton Clarke Research Institute. Her views are her own as a researcher and do not represent the views of the aged care provider she is affiliated with. </span></em></p>Our research shows that aged care work is still stigmatised by other health professionals as dirty, difficult and low-status – more than most other jobs.Asmita Manchha, Research fellow, The University of QueenslandLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/2073022023-06-08T10:31:50Z2023-06-08T10:31:50ZGrattan on Friday: Labor caught in pincer movement of fighting inflation and delivering to its constituency<p>During the election campaign Anthony Albanese repeated, endlessly, that everything was going up except people’s wages. </p>
<p>More than a year later, things are still going up, now including some people’s wages. </p>
<p>The latter increase is all good, surely? Yes, up to a point. There’s dispute about whether the (still modest and limited) wage rises recently delivered by the Fair Work Commission will lead to other things going up further. </p>
<p>Jim Chalmers was blooded as a staffer to the then treasurer, Wayne Swan, during the global financial crisis. Now Treasurer Chalmers is in the driver’s seat as another Labor government copes with an economic crisis – very different from the GFC, but similar in that it has arisen from circumstances not of the government’s making. </p>
<p>Chalmers insists the Fair Work Commission’s 8.6% rise in the minimum wage and 5.75% increase in award wages won’t add to Australia’s inflation problem. The minimum wage rise (which is above current inflation) affects only a few people; the increase in awards is below the inflation level. In total, the increases affect up to a quarter of wage earners.</p>
<p>Regardless of the government’s confidence, the medium-term effect of the wages decision remains one of those “time will tell” issues. </p>
<p>Reserve Bank Governor Philip Lowe this week made the obvious point. “How much it adds to the inflation outcomes really depends upon whether it spreads across other parts of the labour market.” </p>
<p>It’s clear current inflation hasn’t been driven by wages. Their future course will rest on what expectations are generated and whether unions muscle up to extract substantial pay deals. </p>
<p>The trajectory of wages is just one of the unknowns in the complex situation facing the economy, and thus the government, over the next year. </p>
<p>For many Australians, however, the picture is starkly simple. Their mortgage payments have been hit again, with the Reserve Bank this week increasing the cash rate by a quarter of a percentage point. The bank has indicated there could be another hit to come. Meanwhile the necessities of life are at sky-high prices.</p>
<p>Many critics are yet again railing against Lowe. One-time Labor minister Stephen Conroy, who probably should know better, declared: “This bloke has lost the plot. He’s given the middle finger on the way out the door to the Australian public as he gets shuffled out the door.”</p>
<p>Lowe’s home truths regularly provoke fury. “If people can cut back on spending or, in some cases, find additional hours of work, that would put them back into a positive cash-flow position,” he said this week. </p>
<p>True, but it’s not what cash-strapped people want to hear (or necessarily can do), especially when the governor makes it clear the bank will, if necessary, inflict more pain. Anyway, higher interest rates will mean some people losing jobs.</p>
<p>While the recent review of the Reserve Bank suggested it should explain itself more, arguably Lowe would have done better to say less over recent years (certainly that’s true of his prediction rates would not move until 2024). Chalmers may list communication skills as one criterion when he chooses Lowe’s successor. </p>
<p>Chalmers himself is strong on messaging, this week carefully keeping his distance from the latest rate rise. </p>
<p>As Wednesday’s national accounts showed the economy slowing and productivity going backwards, the government is caught in a pincer movement. </p>
<p>It must meet the challenge of managing the economy, which means at this point, as Chalmers says, putting the fight against inflation to the fore. Chalmers is always quick to quote those (including Lowe) who say the budget wasn’t inflationary. </p>
<p>Being good economic managers is objectively necessary, but politically too. It’s a mantle Labor needs to wear for the government’s long-term survival. </p>
<p>On the other hand, Labor’s base and its election pitch push in another direction. </p>
<p>This is a LABOR government. Its core constituents, including and especially those on low wages, are hurting badly, while its core union base is feeling its oats. </p>
<p>Labor’s mantra, before the election and since, has been to get wages moving. The unions demanded, and were given, changes to the industrial relations system to improve their bargaining power in the pursuit of wage rises. </p>
<p>Last year’s jobs summit brought together business and unions (as well as the community sector). But, by the end of it, there was no doubt the unions had the upper hand, which was always going to be the case.</p>
<p>This week a coalition of business groups launched a campaign against the government’s planned “Same Job, Same Pay” legislation, designed especially to stop labour hire companies undercutting wages. </p>
<p>It hasn’t taken long for the traditional scratchy relationship between Labor and business to emerge, although in a relatively mild form – nothing like, for example, the fight between the Rudd government and the miners over the resource super profits tax, which is still fresh in Chalmers’ memory. </p>
<p>What happens to the economy in the period ahead is partially out of the government’s hands, dependent on international factors. </p>
<p>Having said that, a lot will rest with Chalmers and his colleagues. </p>
<p>For instance, if wage pressures do become a worry, will the government require a more creative approach to the problem, including perhaps more innovative submissions to the Fair Work Commission or a tax trade-off with the union movement? </p>
<p>The government urgently needs to find ways to get productivity moving, because that’s the route to sustainable real wage rises. No one, however, underestimates how difficult it is to restart this motor. </p>
<p>To an extent, Chalmers finds himself in a relatively isolated position within the government. </p>
<p>Like all treasurers, he has to be the one who (often) says no to spending ministers. He also should be, to some degree, a counter weight to the colleague who in effect speaks for the unions, Employment Minister Tony Burke. </p>
<p>Inevitably, a treasurer must carry the economic debate for the government, although that burden is always shared between treasurer and prime minister. </p>
<p>In this government, for various reasons, including his many international engagements and his preoccupation with the Voice referendum, Albanese has not been doing as much of the economic heavy lifting as some of his predecessors. As people become increasingly agitated about their circumstances, that might have to change.</p><img src="https://counter.theconversation.com/content/207302/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Michelle Grattan does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Chalmers is in the driver’s seat as another Labor government copes with an economic crisis – very different from the GFC, but similar in being driven by circumstances not of the government’s making.Michelle Grattan, Professorial Fellow, University of CanberraLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/2069282023-06-05T08:10:51Z2023-06-05T08:10:51ZDon’t blame Australia’s lowest-paid workers if interest rates rise again<figure><img src="https://images.theconversation.com/files/529976/original/file-20230605-23-gvt4q1.jpg?ixlib=rb-1.1.0&rect=0%2C508%2C5760%2C2888&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">
</span> <span class="attribution"><span class="source">Shutterstock</span></span></figcaption></figure><p>The odds have been shortening on the Reserve Bank of Australia lifting interest again, and Australia’s workers are again being blamed for driving inflation. </p>
<p>Harvey Norman chairman and executive director Gerry Harvey is one of the business leaders flamboyantly warning higher wages will lead businesses to <a href="https://www.afr.com/work-and-careers/workplace/minimum-wage-rise-will-push-up-prices-put-jobs-at-risk-gerry-harvey-20230604-p5ddsc">cut staff numbers or increase prices</a>, making it harder for the central bank to get inflation down to its 2–3% target.</p>
<p>This follows the decision of Australia’s industrial relations umpire in its <a href="https://www.fwc.gov.au/documents/resources/annual-wage-review-2022-23-decision-announcement.pdf">Annual Wage Review</a> last week. The Fair Work Commission granted a 5.75% increase to award wage rates, and an 8.6% increase to the minimum wage.</p>
<p>But there are good reasons this decision won’t have a material impact on inflation or interest rates. </p>
<h2>Limited impact on the wages bill</h2>
<p>To start with, the increase in award rates directly affects only <a href="https://www.fwc.gov.au/documents/resources/2023fwcfb3500.pdf">about 20%</a> of workers. And those workers, being low paid and often part-timers, only account for <a href="https://www.fwc.gov.au/documents/resources/2023fwcfb3500.pdf">about 11%</a> of the national wages bill.</p>
<p>Markets <a href="https://www.news.com.au/finance/economy/australian-economy/lowestpaid-australians-set-for-pay-rise-after-fair-work-commission-lifts-minimum-wage/news-story/9cb39019d75a3a8cab4a84e26bd0f0cd">expected a 5% rise anyway</a>. The Fair Work Commission’s decision, being 0.75 of a percentage point above market expectations, means the national wages bill will be only 0.08% (less than one-thousandth) greater than expected.</p>
<p>As a general principle in economics, if the increase in “real wages” (“money wages” minus prices growth) is similar to the trend growth in national productivity, then wage increases will have no impact on inflation. </p>
<p>Over the long run, the Fair Work Commission aims to increase wages in line with growth in prices and productivity. In this decision, though, real wages for even most low-paid workers <a href="https://www.fwc.gov.au/documents/resources/2023fwcfb3500.pdf">are falling</a>. Wages growth is putting <em>downward</em> pressure on inflation.</p>
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<p>Not all award-reliant workers will get the increase anyway, because there are still employers who ignore awards and <a href="https://www.smh.com.au/money/planning-and-budgeting/unsavoury-and-difficult-instances-of-wage-theft-reach-record-highs-20230207-p5cil8.html">underpay employees</a>.</p>
<p>It’s true the decision to increase the federal minimum wage by 8.6% was for more than the increase in award rates. That’s because the minimum wage serves a different purpose to awards. It targets low-wage people who aren’t covered by awards, which is a tiny <a href="https://www.fwc.gov.au/documents/resources/2023fwcfb3500.pdf">0.7%</a> of workers.</p>
<p>The Fair Work Commission raised the minimum wage benchmark from an old, rarely used classification in awards (known as C14) to one matching what most bottom-level workers get paid anyway (known as C13). While the commission is still reviewing the relationship between awards and the minimum wage, this one-off increase, affecting very few workers, is likely to be the biggest change we will see.</p>
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Read more:
<a href="https://theconversation.com/up-to-1-in-6-recent-migrants-get-less-than-the-minimum-wage-heres-why-206067">Up to 1 in 6 recent migrants get less than the minimum wage. Here’s why</a>
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<h2>What about other workers?</h2>
<p>The implications of all this for other workers are very limited. Most workers on enterprise agreements (outside of retail and hospitality) and many on individual contracts <a href="https://research-repository.griffith.edu.au/bitstream/handle/10072/405188/Peetz498007-Published.pdf?sequence=2&isAllowed=y">receive so much more than the award</a> that an award increase does not matter. Their wage outcomes are more influenced by the state of the labour market, employer approaches to bargaining, inflation and, critically, the bargaining power of unions – something that has been <a href="https://theconversation.com/theres-an-obvious-reason-wages-arent-growing-but-you-wont-hear-it-from-treasury-or-the-reserve-bank-122041">declining substantially in recent decades</a>. </p>
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<p>Some workers on enterprise agreements have received such low increases that award rates have caught up to them. This is one reason <a href="https://www.abs.gov.au/statistics/labour/earnings-and-working-conditions/employee-earnings-and-hours-australia/latest-release">award coverage has grown from 16% in 2012 to 23% in 2021</a>, but those workers are factored into the cost impact anyway. </p>
<p>With lower bargaining power, average workers’ wages are <a href="https://www.abc.net.au/news/2023-02-22/wages-growing-at-3-3-per-cent-december-quarter-2022/102007390">growing well below prices</a>. There is no way the current inflation can be seen as a wage-price spiral. It is so unlike the last large spike in inflation, in the <a href="https://johnmenadue.com/the-secure-work-bill-inches-australia-into-the-21st-century/">1973–74 wage-push period</a>, that any <a href="https://www.smh.com.au/business/the-economy/boomer-fantasy-why-fears-of-1970s-style-stagflation-are-indeed-misplaced-20220626-p5awm8.html">comparison would be laughable</a>. </p>
<p>Reserve Bank governor Philip Lowe <a href="https://www.rba.gov.au/speeches/2023/sp-gov-2023-03-08.html">in March said</a> “the risk of a prices-wages spiral remains low”. The Bank’s wage forecasts are <a href="https://www.rba.gov.au/publications/smp/2023/may/forecasts.html">now</a> slightly lower than <a href="https://www.rba.gov.au/publications/smp/2023/feb/forecasts.html">then</a>. But by continuing to raise interest rates, it keeps on behaving as if a wages break-out is a real prospect.</p>
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Read more:
<a href="https://theconversation.com/1970s-style-stagflation-now-playing-on-central-bankers-minds-185868">1970s-style stagflation now playing on central bankers' minds</a>
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<h2>Profits and prices</h2>
<p>Profits had been growing considerably faster than wages, both in Australia and overseas, though profits are now slowing down in both. There’s a debate in <a href="https://www.abc.net.au/news/2023-05-07/profits-havent-contributed-to-inflation-but-doubts-raised/102312254">Australia</a> and more explicitly <a href="https://www.nytimes.com/2022/06/03/business/economy/price-gouging-inflation.html">overseas</a>, about the role of profit-making in reinforcing inflation. </p>
<p>Economists <a href="https://www.theguardian.com/business/2023/mar/02/ecb-looking-out-for-price-gouging-greedflation-price-rises-eurozone-inflation-profit-margins?CMP=share_btn_tw">overseas</a> have pointed to its <a href="https://scholarworks.umass.edu/cgi/viewcontent.cgi?article=1348&context=econ_workingpaper">likely role</a> <a href="https://econbrowser.com/archives/2023/05/why-might-firms-raise-prices-faster-than-input-prices">after an initial shock</a>, for example from fuel shortages. This includes economists associated with the <a href="https://www.bloomberg.com/news/articles/2023-04-01/ecb-s-panetta-says-pay-more-attention-to-price-impact-of-profits#xj4y7vzkg">European Central Bank</a> and the <a href="https://economy-finance.ec.europa.eu/system/files/2023-05/ip200_en_1.pdf">European Commission</a> (so it is <a href="https://www.axios.com/2023/05/18/once-a-fringe-theory-greedflation-gets-its-due">no longer a fringe concern</a>). </p>
<p>But firms <a href="https://www.reuters.com/markets/europe/ecb-confronts-cold-reality-companies-are-cashing-inflation-2023-03-02/">won’t chase cheap profits through hiking prices indefinitely</a>. Sure, firms have the chance to raise prices more than they need, since <a href="https://scholarworks.umass.edu/cgi/viewcontent.cgi?article=1348&context=econ_workingpaper">customers expect price rises </a> during shortages. Firms expect competitors to match price rises. So they can take advantage of a temporary supply shortage to permanently boost profits. But they’re wary of bumping up prices repeatedly, fearing loss of market share. So inflation (but not prices themselves) should fall.</p>
<p>Indeed, the Reserve Bank of Australia – along with the Treasury and pretty much everyone else – anticipates that inflation is falling anyway. In the central bank’s case, it expects inflation to more than halve, to <a href="https://www.rba.gov.au/publications/smp/2023/may/forecasts.html">3.2% by December next year</a>. </p>
<h2>Inflation and interest rates</h2>
<p>So there is no reason for the Reserve Bank of Australia to raise interest rates again in light of the award wage decision. It has minimal implications for inflation, which is heading downwards. </p>
<p>That does not mean the central bank won’t raise rates. After all, it increased interest rates last month while inflation was falling. Market <a href="https://www2.asx.com.au/markets/trade-our-derivatives-market/futures-market/rba-rate-tracker">expectations of a rate rise</a> were already increasing <a href="https://www.afr.com/markets/debt-markets/traders-economists-up-bets-on-june-rba-rate-rise-20230531-p5dcvq">before the Fair Wage Commission decision</a>, due to a temporary and unexpected <a href="https://www.smartcompany.com.au/finance/economy/australia-inflation-crisis-far-from-over-data/">rise in monthly inflation</a> <a href="https://www.abs.gov.au/statistics/economy/price-indexes-and-inflation/monthly-consumer-price-index-indicator/apr-2023">figures</a>. If rates rise, it’s not the Fair Work Commission’s handiwork.</p>
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Read more:
<a href="https://theconversation.com/lifting-the-minimum-wage-isnt-reckless-its-what-low-earners-need-183643">Lifting the minimum wage isn't reckless – it's what low earners need</a>
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<p>The problem, as <a href="https://economy-finance.ec.europa.eu/system/files/2023-05/ip200_en_1.pdf">the European Commission’s latest economic forecast warns</a>, is that, when profits and prices rise, workers will seek to offset their loss of purchasing power and income share by raising wage demands. Whether they succeed or not is another matter. But “<a href="https://economy-finance.ec.europa.eu/system/files/2023-05/ip200_en_1.pdf">protracted distributional conflicts could delay the process of disinflation</a>”. </p>
<p>That could affect central bank actions down the track, though effective action on prices themselves would reduce that risk. It also creates policy problems for the federal government, on whether and how to redistribute income back to labour.</p><img src="https://counter.theconversation.com/content/206928/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>over the years David Peetz has received funding for research from the Australian Research Council, various unions and employers, state and national governments of both political flavours in Australia and overseas, the International Labour Organisation and the Organisation for Economic Cooperation and Development. He is presently employed by the Carmichael Centre at the Centre for Future Work.</span></em></p>Will the decision to grant a 5.75% increase in award rates add to inflation and increase interest rates, making many of us worse off? Well, no.David Peetz, Laurie Carmichael Distinguished Research Fellow at the Centre for Future Work, and Professor Emeritus, Griffith Business School, Griffith UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/2049192023-05-03T12:46:24Z2023-05-03T12:46:24ZGovernment to spend $11.3 billion over four years to fund 15% pay rise for aged care workers<p>Tuesday’s budget will include $11.3 billion over four years to fund the 15% pay rise aged care workers will receive from July 1.</p>
<p>The rise was awarded by the Fair Work Commission. Labor committed at last year’s election to fully fund a rise in pay for this sector. </p>
<p>Given acute staff shortages, it is hoped that the higher wages will attract more workers.</p>
<p>The pay rises will benefit more than 250,000 people.</p>
<p>A registered nurse on a level 2.3 award wage will receive an extra $196.08 a week – more than $10,000 a year. </p>
<p>A personal care worker on a level 4 (aged care award) or a home care worker on a level 3.1 (social, community, home care and disability services award) will get an extra $141.10 weekly – more than $7300 annually. </p>
<p>Recreational officers and chefs in the sector also are in line for increases. </p>
<p>Treasurer Jim Chalmers said that “for too long, those working in aged care have been asked to work harder for longer without enough reward, but with this budget that changes”. </p>
<p>Aged Care Minister Anika Wells said that “fair wages play a major role in attracting and retaining workers”. </p>
<p>Aged care is now the fifth-largest area of federal government spending.
This financial year the cost of aged care will increase from $24.8 billion to an estimated $29.6 billion (23%).</p>
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Read more:
<a href="https://theconversation.com/politics-with-michelle-grattan-ndia-chair-kurt-fearnley-on-fundamental-reform-of-the-disability-scheme-204922">Politics with Michelle Grattan: NDIA chair Kurt Fearnley on 'fundamental' reform of the disability scheme</a>
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<p>There are about 1.5 million recipients of aged care in Australia, with growing pressures on the system ahead as the population ages.</p>
<p>In a round of Wednesday media appearances, Chalmers reiterated next week’s budget would contain “substantial cost-of-living relief”. </p>
<p>“It’ll prioritise the most vulnerable. It won’t just be limited by age, and it will be responsible.”</p>
<p>Chalmers said the budget would forecast the economy slowing considerably but not going into recession. </p>
<p>“The budget will be a difficult balancing act, between providing the cost-of-living relief that people need, being conscious of the pressures on the budget and all of that debt that we inherited, but also making sure that we can grow our way out of this slowing economy by investing in things like energy and laying some of these foundations for growth in our economy.”</p>
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Read more:
<a href="https://theconversation.com/word-from-the-hill-another-rate-rise-higher-tax-on-cigarettes-and-likely-jobseeker-boost-for-over-55s-204814">Word from The Hill: Another rate rise, higher tax on cigarettes, and likely JobSeeker boost for over-55s</a>
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<p>Chalmers said the budget would also contain efforts “to get people into work if they want to work, including in communities where there has been for too long entrenched disadvantage”. </p>
<p>“We’ve got colleagues working on the job agency system to make sure that if people want to work, they can grab the opportunities of an economy that’s got unemployment currently running at three and a half per cent.”</p><img src="https://counter.theconversation.com/content/204919/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Michelle Grattan does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Treasurer Jim Chalmers said that “for too long, those working in aged care have been asked to work harder for longer without enough reward, but with this budget that changes”Michelle Grattan, Professorial Fellow, University of CanberraLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1958042022-12-07T19:05:17Z2022-12-07T19:05:17ZWage theft has reached pandemic proportions, so why hasn’t the Albanese government criminalised it?<figure><img src="https://images.theconversation.com/files/499387/original/file-20221206-16-tqmk5.jpg?ixlib=rb-1.1.0&rect=0%2C0%2C4493%2C2915&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">
</span> <span class="attribution"><span class="source">Shutterstock</span></span></figcaption></figure><p>Australia’s first criminal case over wage theft is under way, with charges laid against the owner of a Victorian restaurant that <a href="https://www.abc.net.au/news/2022-11-29/macedon-lounge-restaurant-charged-victoria-wage-theft-laws/101710104">allegedly underpaid</a> staff by thousands of dollars. </p>
<p>If found guilty, the owner of the Macedon Lounge, northwest of Melbourne, faces a fine of more than $1 million and potentially jail time under Victoria’s <a href="https://www.legislation.vic.gov.au/as-made/acts/wage-theft-act-2020">Wage Theft Act</a>.</p>
<p>The law came into effect in July 2021. The Andrews Labor government promised it before the 2018 state election, as evidence mounted that existing civil penalty fines were not a sufficient deterrent. </p>
<p>This week Unions NSW called for national action <a href="https://www.unionsnsw.org.au/wage-theft/#:%7E:text=If%20you%20think%20you%20are,to%20speak%20with%20a%20translator.">in a report</a> on underpayment of migrant workers. This was based on an audit of job advertisements on Chinese, Korean, Nepalese, Punjabi and Spanish websites. It found 70% offered less than minimum rates.</p>
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Read more:
<a href="https://theconversation.com/weve-let-wage-exploitation-become-the-default-experience-of-migrant-workers-113644">We've let wage exploitation become the default experience of migrant workers</a>
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<p>The Albanese government also made a pre-election promise to criminalise wage theft, as part of its <a href="https://www.alp.org.au/policies/secure-australian-jobs">Secure Australian Jobs Plan</a>:</p>
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<p>Wage theft rips more than $1 billion off Australian workers each year. The Morrison government doesn’t think it’s a problem, but Labor does, and we will make wage theft a crime at a national level.</p>
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<p>This was left out of the omnibus amendments to the Fair Work Act passed last week. It’s unclear whether the government will pursue this further in its first term. </p>
<p>But criminalisation may not be the best approach. Other reforms are just as important.</p>
<h2>Now a broad-scale problem</h2>
<p>It is clear wage theft and other forms of non-compliance with minimum labour standards are a major problem in Australia. </p>
<p>Prominent employers that have underpaid workers or been accused of non-compliance include restaurants <a href="https://theconversation.com/all-these-celebrity-restaurant-wage-theft-scandals-point-to-an-industry-norm-131286">owned by celebrity chefs</a> Heston Blumenthal, Shannon Bennett, George Calombaris and Neil Perry; franchises <a href="https://www.abc.net.au/news/2022-04-06/7-eleven-wage-theft-98-million-franchisees-class-action/100970682">7-Eleven</a>, <a href="https://www.abc.net.au/news/2017-08-11/fair-work-ombudsman-slams-pizza-hut-underpayment-newcastle/8796896">Pizza Hut</a> and <a href="https://thenewdaily.com.au/finance/finance-news/2022/11/02/dominos-wage-theft-class-action/">Domino’s</a>; and blue-chip companies <a href="https://insideretail.com.au/news/bunnings-coughs-up-over-3-8-million-to-underpaid-team-members-201911">Bunnings</a>, <a href="https://insideretail.com.au/business/fwo-takes-coles-to-court-over-alleged-115m-in-underpayments-202112">Coles</a>, <a href="https://www.smh.com.au/politics/federal/wages-watchdog-claims-cba-knowingly-breached-pay-rules-20211010-p58yqq.html">Commonwealth Bank</a>, <a href="https://www.smh.com.au/politics/federal/qantas-admits-underpaying-hundreds-of-staff-20200313-p549qg.html">Qantas</a> and <a href="https://thenewdaily.com.au/finance/finance-news/2022/02/23/woolworths-underpayments/">Woolworths</a>. Even institutions such as <a href="https://www.abc.net.au/news/2022-11-29/deakin-university-wage-theft-accusations/101709768">Deakin University</a> and <a href="https://www.smh.com.au/politics/federal/abc-admits-it-has-underpaid-up-to-2500-casual-staff-over-six-years-20190110-p50qk5.html">the ABC</a> have been implicated. </p>
<p>The issue has been the focus of numerous public inquiries, reviews and consultations and media investigations. </p>
<p>A Senate committee inquiry into wage theft that <a href="https://www.aph.gov.au/Parliamentary_Business/Committees/Senate/Economics/Underpaymentofwages/Report/section?id=committees%2freportsen%2f024434%2f79506">reported in March 2022</a> noted wage theft goes back at least to the 1880s, with the rampant stealing of Indigenous wages. </p>
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Read more:
<a href="https://theconversation.com/stolen-wages-northern-territory-class-action-will-hold-the-commonwealth-to-account-149155">Stolen wages: Northern Territory class action will hold the Commonwealth to account</a>
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<p>But wage theft on a broad scale, the inquiry concluded, is a relatively new phenomenon:</p>
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<p>The rate of unlawful underpayment complaints and media reporting increased markedly from around 2015, with mounting evidence that wage theft practices have become widespread in the hospitality, retail, horticulture, franchise-heavy and higher education sectors.</p>
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<h2>Workers most vulnerable</h2>
<p>The workers most vulnerable are migrants on temporary visas, young people, those in “low-skilled” jobs, non-unionised employees, and those in casual and insecure work (the reason for its prevalence in higher education). </p>
<p>The problem is intensified by “fragmented” employment arrangements that obscure who profits from non-compliance, such as labour hire chains featuring multi-layered subcontracting and outsourcing arrangements, or on-demand platform “gig” work.</p>
<p>As Alan Fels, former chair of the Australian Consumer and Competition Commission, <a href="https://www.aph.gov.au/Parliamentary_Business/Committees/Senate/Education_and_Employment/ExploitationofCleaners/Report">has pointed out</a>, wage theft makes it hard for compliant employers to compete.</p>
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Read more:
<a href="https://theconversation.com/shocking-yet-not-surprising-wage-theft-has-become-a-culturally-accepted-part-of-business-121038">Shocking yet not surprising: wage theft has become a culturally accepted part of business</a>
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<p>It also affects government revenue – for example, in cases where payroll tax is avoided by having staff “off the books”. </p>
<h2>Call for criminalisation</h2>
<p>The 2022 Senate inquiry made 19 recommendations. The first was that the federal government amend the Fair Work Act to make any form of remuneration theft – including failing to pay employees their rightful loadings, penalty rates, overtime, leave, allowances and superannuation – a criminal offence. (The second recommendation was that it increase civil penalties.)</p>
<p>Criminal sanctions may elevate awareness and provide another avenue for redress, but whether they would foster greater employer compliance is doubtful. </p>
<p>This is because these would only apply to deliberate breaches, when many cases of non-compliance involve genuine and unintentional mistakes. </p>
<p>Nor will criminal sanctions do anything to assist employees to easily seek redress, given they are about punishment and not compensation. </p>
<h2>There are other, better approaches</h2>
<p>A better approach is to focus on enhanced enforcement, expanding the role of the Fair Work Ombudsman and and other regulatory agencies to investigate, enforce and recover unpaid money, with significant extra resources to do so. </p>
<p>This a key part of the Victorian legislation, which has established the <a href="https://www.vic.gov.au/wage-inspectorate-victoria">Work Inspectorate of Victoria</a> with resources to investigate and enforce the law.</p>
<p>Another reform would be to oblige employers – particularly those in high-risk sectors – to have ongoing compliance regimes in place and to regularly review their payroll processes to ensure compliance. </p>
<p>Finally, as recommended by the Senate inquiry report, there should be a clear avenue for the Australian Securities and Investments Commission to disqualify directors of companies found to have engaged in systemic non-compliance.</p>
<p>Perhaps then the message will start to get through.</p><img src="https://counter.theconversation.com/content/195804/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Giuseppe Carabetta does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Federal Labor made an election promise to criminalise wage theft. But there are better reforms more urgently needed.Giuseppe Carabetta, Associate Professor, University of Technology SydneyLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1955452022-11-30T19:10:14Z2022-11-30T19:10:14ZWhat the compromise IR deal means for wage negotiations, and pay rises<p>The Albanese government’s <a href="https://www.aph.gov.au/Parliamentary_Business/Bills_Legislation/Bills_Search_Results/Result?bId=r6941">Secure Jobs, Better Pay Bill</a> is all set to become law, after Workplace Relations Minister Tony Burke <a href="https://www.abc.net.au/news/2022-11-27/industrial-relations-laws-set-to-pass-parliament/101703572">revealed amendments</a> to secure the support of the Greens and ACT independent David Pocock in the Senate.</p>
<p>The government and the trade union movement see the bill as crucial to <a href="https://www.futurework.org.au/restoring_collective_bargaining_coverage_would_boost_wage_growth">reinvigorating collective bargaining</a> and lifting wages, especially for lower-paid workers.</p>
<p>Much of the debate has focused on what the bill does with multi-employer agreements – and many of the government’s concessions concern that issue.</p>
<p>But if the <a href="https://www.futurework.org.au/wages_crisis_will_continue_without_active_wage_boosting_policies_report">wage stagnation of the past decade</a> is to be overcome, it will likely be through less-heralded reforms.</p>
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<a href="https://theconversation.com/zombie-wage-deals-have-hurt-australians-for-years-heres-how-new-industrial-relations-laws-could-finally-end-your-wage-pain-195534">'Zombie' wage deals have hurt Australians for years. Here's how new industrial relations laws could finally end your wage pain</a>
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<h2>Multi-enterprise agreements</h2>
<p>While there is <a href="https://theconversation.com/why-unions-and-small-business-want-industry-bargaining-from-the-jobs-summit-and-big-business-doesnt-189394">much to be said</a> for industry or sector-wide wage agreements, the Fair Work Act does not allow them, and that will not change under the bill. Unrelated employers can choose to make a “multi-enterprise agreement”. But they cannot be required to bargain and few such agreements are made.</p>
<p>The bill offers the option of two new types of multi-enterprise agreement: supported bargaining agreements, and single-interest employer agreements. Both will require authorisation from the Fair Work Commission before formal bargaining can commence. </p>
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Read more:
<a href="https://theconversation.com/a-mandate-for-multi-employer-bargaining-without-it-wages-for-the-low-paid-wont-rise-193829">A mandate for multi-employer bargaining? Without it, wages for the low paid won't rise</a>
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<h2>Supported bargaining</h2>
<p>The supported bargaining system will replace the largely unused provisions for “<a href="https://theconversation.com/a-mandate-for-multi-employer-bargaining-without-it-wages-for-the-low-paid-wont-rise-193829">low-paid bargaining</a>”. </p>
<p>It is intended for industries in which (single) enterprise bargaining has proved difficult, such as child care or aged care. The Fair Work Commission must be satisfied it is appropriate for the nominated employers to bargain together, having regard to existing pay and conditions, and any identifiable common interest (for example, being reliant on government funding).</p>
<h2>Single-interest bargaining</h2>
<p>The single-interest bargaining stream is potentially broader. </p>
<p>It can apply in any sector other than commercial construction (now specifically excluded from all types of multi-enterprise agreement). However, a combination of the original drafting and subsequent concessions will make it difficult for unions to gain a single-interest authorisation.</p>
<p>Unions will not be able to rope in small business employers (to be defined as those with fewer than 20 regular employees) without their consent.</p>
<p>A larger employer can only be included without their consent if a majority of its affected employees want to bargain.</p>
<p>Employers of any size can only participate if they are sufficiently “comparable” to be regarded as having a common interest.</p>
<p>An employer cannot be included if it has a current single-enterprise agreement, or is negotiating a replacement for one that expired in the previous nine months.</p>
<p>No authorisation will be granted unless the Fair Work Commission is satisfied it is in the public interest.</p>
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Read more:
<a href="https://theconversation.com/employers-say-labors-new-industrial-relations-bill-threatens-the-economy-denmark-tells-a-different-story-193311">Employers say Labor's new industrial relations bill threatens the economy. Denmark tells a different story</a>
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<h2>The pathways to agreement</h2>
<p>If a union can gain permission to pursue one of the new types of multi-enterprise agreement, it will be able to draw on supports for bargaining that were not there under the current law. </p>
<p>Employers named in a supported bargaining or single-interest authorisation would be obliged to bargain in good faith. </p>
<p>Employees with a bargaining representative could take industrial action – although only if approved in a ballot of represented employees at their workplace.</p>
<p>The Fair Work Commission could assist the parties to reach agreement. In the case of supported bargaining, that might include requiring the involvement of a head contractor or funding body with a “degree of control” over workers’ pay and conditions.</p>
<p>Most significantly – and as with prolonged negotiations for a single-enterprise agreement – the commission could resolve an “intractable” bargaining dispute by arbitration. Just the threat of such intervention should improve the chances of gaining agreement. </p>
<p>This, arguably, is the biggest reform to bargaining in the bill.</p>
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<h2>So when do the wage rises happen?</h2>
<p>It will take time to test out the new provisions. </p>
<p>Meeting the onerous requirements for a single-interest authorisation will be difficult, except for employers already bargaining together (such as franchisees or faith-based schools).</p>
<p>If a union can secure majority support at a particular enterprise, it can probably already bargain there. </p>
<p>Any attempt to let existing deals expire and then shift to multi-employer bargaining may be met by public-interest objections – unless the employers concerned also see value in a more collective approach.</p>
<p>Supported bargaining has a greater chance of taking off, especially in low-paid industries where employers may support higher pay if assured of not being at a competitive disadvantage.</p>
<h2>Other pathways</h2>
<p>The bill offers other routes to higher wages, through “work value” adjustments to award rates, and improved access to equal remuneration orders. That focus on pay equity, also evident in the bill’s prohibition of pay secrecy clauses, may prove just as useful in delivering wage rises for feminised sectors.</p>
<p>More generally, the bill seeks to simplify the process of making enterprise agreements and getting them approved. </p>
<p>This includes changes to the “better off overall test”, which ensures negotiated pay and conditions are set above the award minimum, not below. (The government has agreed to fix a drafting problem that might have created a <a href="https://www.afr.com/work-and-careers/workplace/bargaining-bill-loophole-could-cut-pay-for-new-hires-union-20221102-p5buv1">loophole for employers to exploit</a>.)</p>
<p>Overall, the Secure Jobs, Better Pay Bill may speed up some bargaining processes and, over time, help reverse the <a href="https://theconversation.com/theres-one-big-reason-wages-are-stagnating-the-enterprise-bargaining-system-is-broken-and-in-terminal-decline-183818">trend away from agreement-making</a>. </p>
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Read more:
<a href="https://theconversation.com/theres-one-big-reason-wages-are-stagnating-the-enterprise-bargaining-system-is-broken-and-in-terminal-decline-183818">There's one big reason wages are stagnating: the enterprise bargaining system is broken, and in terminal decline</a>
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<p>But if real wage rises are to return, it will more likely be because governments are prepared to fund them – and employers are willing to trade some of their profits for economic growth.</p><img src="https://counter.theconversation.com/content/195545/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Andrew Stewart does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Despite the controversy over multi-employer bargaining, higher wages are likely to come from other provisions in the Albanese government’s Secure Jobs, Better Pay Bill.Andrew Stewart, John Bray Professor of Law, University of AdelaideLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1955342022-11-29T05:00:02Z2022-11-29T05:00:02Z‘Zombie’ wage deals have hurt Australians for years. Here’s how new industrial relations laws could finally end your wage pain<figure><img src="https://images.theconversation.com/files/497844/original/file-20221129-20-bcougd.png?ixlib=rb-1.1.0&rect=1192%2C381%2C2384%2C1374&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Independent Senator David Pocock will vote for the government's industrial relations bill.</span> <span class="attribution"><span class="source">Mick Tsikas/AAP</span></span></figcaption></figure><p>Imagine you were trying to design a system that would hold back wages. You would design one pretty much like the one we’ve got today. </p>
<p>That’s why the government wants to change it.</p>
<p>Those of us on <a href="https://www.fairwork.gov.au/tools-and-resources/fact-sheets/rights-and-obligations/enterprise-bargaining">enterprise bargaining</a> agreements get our wage rises locked in only every three or so years. If we didn’t lock in enough in last year’s agreement to cover this year’s sudden outbreak of inflation, there’s nothing much we can do about it for another two or so years.</p>
<p>It’s a built-in inertia identified by financial services firm JP Morgan in its attempts to explain to foreign clients why Australian wages growth is so low. </p>
<p>Australian enterprise agreements, JP Morgan explains in a <a href="https://markets.jpmorgan.com/research/email/lbkdv6h1/Tny3gAthm_em5y6E4Rjnag/GPS-4271004-0">note to clients</a>, both delay wages growth and trim its peaks.</p>
<p>Here’s how that came about – and how the Albanese government’s new industrial relations law might finally end Australians’ pay freeze.</p>
<h2>Wages used to be mostly set by awards</h2>
<p>For nearly a century, Australian wages were generally set by judges in state and federal industrial relations tribunals. They had the power to intervene and set an “<a href="https://treasury.gov.au/sites/default/files/2019-03/p2017-t237966.pdf">award</a>” wage for an industry or occupation in which there was a dispute. And it was easy enough for unions and employers to create disputes.</p>
<p>Because they almost always intervened, the tribunals got to ensure that wages didn’t move too much relative to each other, and it got an insight into the state of the economy from the government, which made submissions. </p>
<p>From one point of view, the strength of this peculiarly Australian system of setting wages was that each employer covered by a decision was compelled to deliver the same increase as its competitors, meaning none were disadvantaged.</p>
<p>From another point of view, this strength was becoming a weakness. The weak firms as well as the strong had to pay the increases, whether it was easy or not.</p>
<h2>Enterprise agreements unleashed productivity</h2>
<p>In the early 1990s, perhaps with an eye to the possibility that an incoming Coalition government might make even greater changes, the Keating Labor government changed the law to channel the workers and employers within each workplace into enterprise bargaining.</p>
<p>The tribunals would have a more limited role, checking that each enterprise agreement passed a “better off overall” test, and continuing to set awards that became more like backstops, slipping below what most workers (usually through their unions) were able to negotiate with individual employers.</p>
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Read more:
<a href="https://theconversation.com/employers-say-labors-new-industrial-relations-bill-threatens-the-economy-denmark-tells-a-different-story-193311">Employers say Labor's new industrial relations bill threatens the economy. Denmark tells a different story</a>
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<p>Workers and unions did well at first, because they were able to get together with employers and nut out ways to save money to pay for wage rises – something they had had little incentive to do when wages were set centrally.</p>
<p>And it was something that could only really be done at the level of each enterprise, because each was different, and it was the workers on the ground who knew how to make it better.</p>
<h2>Zombie agreements and frozen wages</h2>
<p>But productivity couldn’t be unleashed in the same way forever. After a while, the easy gains had been had. Workers got good pay rises in return for streamlining unwieldy processes at the start, then had few unwieldy processes left to streamline. </p>
<p>Productivity surged during the first decade, until the early 2000s. Then employers became more cautious about granting pay rises, and by the 2010s became good at stringing out negotiations or letting agreements expire, which meant they rolled over as “zombie agreements” without an increase.</p>
<figure class="align-right zoomable">
<a href="https://images.theconversation.com/files/497815/original/file-20221129-19-22n4cd.png?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/497815/original/file-20221129-19-22n4cd.png?ixlib=rb-1.1.0&q=45&auto=format&w=237&fit=clip" srcset="https://images.theconversation.com/files/497815/original/file-20221129-19-22n4cd.png?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=968&fit=crop&dpr=1 600w, https://images.theconversation.com/files/497815/original/file-20221129-19-22n4cd.png?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=968&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/497815/original/file-20221129-19-22n4cd.png?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=968&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/497815/original/file-20221129-19-22n4cd.png?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=1216&fit=crop&dpr=1 754w, https://images.theconversation.com/files/497815/original/file-20221129-19-22n4cd.png?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=1216&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/497815/original/file-20221129-19-22n4cd.png?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=1216&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
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<span class="caption">Some Australians have ended up living with frozen wages.</span>
<span class="attribution"><span class="source">Shutterstock</span></span>
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<p>As the Business Council explained in a report on the state of enterprise bargaining
in 2019, agreements that had lapsed but were still operational came to act “<a href="https://d3n8a8pro7vhmx.cloudfront.net/bca/pages/4880/attachments/original/1565674049/The_state_of_enterprise_bargaining_in_Australia.pdf?1565674049">like a wage freeze for some employees</a>”.</p>
<p>With union membership down from 40% of workers when enterprise bargaining began, to just <a href="https://www.datawrapper.de/_/Ccsht/">14%</a> in 2020, there was little workers on frozen agreements could do to get more, other than fall back on awards, which at least usually climbed with inflation.</p>
<p>It means the system has come to work in a way hardly anyone actually intended. It is acting as a brake on pay rises, while becoming more centralised. </p>
<p>The Reserve Bank says it can see some signs that wages growth is picking up, even in new enterprise agreements, but that it will take some time to flow through to all agreements in general because of the “multi-year duration” of the agreements.</p>
<h2>How the new law could break the pay freeze</h2>
<p>What the Albanese government has proposed – and is about to finally get through the Senate with the help of the Greens and independent David Pocock – is an attempt to bust the inertia. </p>
<p>Expanding <a href="https://www.dewr.gov.au/secure-jobs-better-pay/resources/cooperative-workplaces-bargaining-stream">multi-employer bargaining</a> will allow employers to bargain knowing their competitors will have to pay what they pay. </p>
<p><a href="https://www.afr.com/work-and-careers/workplace/manufacturers-move-on-sector-deal-amid-race-to-bolster-union-hurdles-20221128-p5c1u0">Air-conditioning manufacturers</a> have already begun talks with the Australian Manufacturing Workers Union in a bid to drive up workplace standards and pay in a way they know won’t be undercut by cheaper competitors.</p>
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Read more:
<a href="https://theconversation.com/what-the-compromise-ir-deal-means-for-wage-negotiations-and-pay-rises-195545">What the compromise IR deal means for wage negotiations, and pay rises</a>
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<p>Allowing employers with <a href="https://ministers.dewr.gov.au/burke/transcript-national-press-club-address">genuine ongoing enterprise agreements</a> to escape multi-employer bargaining will encourage more genuine agreements.</p>
<p>And loosening the “<a href="https://www.dewr.gov.au/secure-jobs-better-pay/resources/better-overall-test">better off overall</a>” test will make it easier to get agreements of all kinds registered. </p>
<p>Particularly helpful will be “<a href="https://www.dewr.gov.au/secure-jobs-better-pay/resources/supported-bargaining-stream">supported bargaining</a>”, in which the Fair Work Commission will sit around the table with workers in fields such as childcare, who have traditionally found it hard to bargain. Where necessary, the commission will pull in outside funders (such as the government for childcare) for talks.</p>
<p>None of it will work miracles. But it should help. And it’s unlikely to hurt.</p><img src="https://counter.theconversation.com/content/195534/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Peter Martin does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>For more than a decade, employers have strung out negotiations or let agreements expire. Known as “zombie agreements”, those deals mean too many Australians are living with wages frozen in the past.Peter Martin, Visiting Fellow, Crawford School of Public Policy, Australian National UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1948182022-11-22T02:47:51Z2022-11-22T02:47:51ZChristmas may be safe, but three-year port dispute shows the IR system is full of holes<figure><img src="https://images.theconversation.com/files/496042/original/file-20221118-25-iapl0i.jpg?ixlib=rb-1.1.0&rect=0%2C0%2C3834%2C1942&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">
</span> <span class="attribution"><span class="source">Shutterstock</span></span></figcaption></figure><p>Australia’s industrial relations umpire has delayed industrial action that would have crippled Australia’s ports in the lead-up to Christmas. </p>
<p>But the dispute in which it has intervened – one that has dragged on since 2019 – shows the need for reform of Australia’s collective bargaining system. </p>
<p>The Fair Work Commission last week intervened in the protracted dispute between tugboat operator Svitzer Australia and three maritime unions after the company declared its intention to “lock out” staff in a bid to force a resolution – either by the unions caving or by the commission using its powers to arbitrate outstanding matters.</p>
<p>Svitzer, a subsidiary of Danish shipping giant Maersk, <a href="https://www.afr.com/work-and-careers/workplace/svitzer-lockout-threatens-port-supply-chain-shutdown-20221114-p5by0t">employs about 600 staff</a> at 17 Australian ports. Its tugboats guide the arrival and departure of container ships <a href="https://www.marineinsight.com/shipping-news/unions-urge-maersks-return-to-negotiating-table-as-australian-court-blocks-controversial-svitzer-tug-lockout/">carrying about 75%</a> of Australia’s trade. The lockout would have prevented ships entering or leaving port.</p>
<p>Last Friday the full bench of the Fair Work Commission <a href="https://www.fwc.gov.au/documents/sites/svitzer-industrial-action/b2022-1726-decision-2022-fwcfb-209-2022-11-18.pdf">ordered a six-month suspension</a> on any industrial action by Svitzer or the three unions – the Construction, Forestry, Maritime, Mining and Energy Union (CFMMEU), the Australian Maritime Officers Union (AMOU), and the Australian Institute of Marine and Power Engineers (AIMPE).</p>
<p>It did so using its powers to stop industrial action that threatens to cause significant damage to the economy or part of it.</p>
<p>However, the commission refused Svitzer’s application to terminate the notified lockout, an outcome that could have led to the commission arbitrating the outstanding matters in dispute. Arbitration appeared to be <a href="https://www.fwc.gov.au/documents/sites/svitzer-industrial-action/b2022-1726-submissions-svitzer-2022-11-17.pdf">Svitzer’s aim</a> but was opposed <a href="https://www.fwc.gov.au/documents/sites/svitzer-industrial-action/b2022-1726-outline-of-submissions-mua-2022-11-17.pdf">by the unions</a>.</p>
<h2>Background to the dispute</h2>
<p>Svitzer and the unions began negotiating a new enterprise agreement in late 2019. The company wanted changes to the agreement made in 2016 to give it greater flexibility in hiring staff. The unions opposed these changes on the basis they would lead to greater casualisation. </p>
<p>The process laid down by the Fair Work Act is to negotiate, with “protected industrial action” available to the parties to support their claims. </p>
<p>But the Act’s provisions make it particularly hard for port workers to take impactful industrial action, given the commission can suspend or terminate any action threatening to cause significant economic damage.</p>
<p>In February, the commission <a href="https://www.fwc.gov.au/document-search/view/aHR0cHM6Ly9zYXNyY2RhdGFwcmRhdWVhYS5ibG9iLmNvcmUud2luZG93cy5uZXQvZGVjaXNpb25zLzIwMjIvMDMvUFI3MzkwNTIyMDgwOTg3MWU5NTU4OTQ1LTc2N2ItNGZkNi1iNTAzLTBkMmViOGJmMWVkYjIwYzBlOTE5LWUwZDgtNDU1ZC05ZDk5LTAxOTIzZjJhYzg5MS5wZGY1/1/141fd88f-c80f-472f-b0ca-6280b2c4fd1a/Svitzer">blocked 48-hour strikes</a> slated for ten ports in Western Australia, Queensland and New South Wales.</p>
<p>As a result, the unions have taken more low-level industrial action, such as work bans and limited stoppages, which are unlikely to attract the attention of the commission. </p>
<p>Svitzer’s decision to lock out workers recalls that of Qantas’s strategy in 2011, when the airline shut down its fleet to push the commission to arbitrate its dispute with unions over a new enterprise agreement. Qantas was widely considered the winner in the subsequent arbitration.</p>
<p>Svitzer’s motivation is to get rid of the 2016 enterprise agreement. Indeed in January it applied to have the commission terminate <a href="https://www.fwc.gov.au/document-search/view/aHR0cHM6Ly9zYXNyY2RhdGFwcmRhdWVhYS5ibG9iLmNvcmUud2luZG93cy5uZXQvZGVjaXNpb25zLzIwMjIvMDYvUFI3NDI0MjEyMzU3NzU4MjhkMDRhOTMyLTFkYTktNDE3YS04Yzc1LTlkZTQ2ZjMyOTY3ZWVmMGI2NmI2LWI5YWItNGRlMy04OGQ2LWZjNTJiNGRlNGZjNS5wZGY1/1/5ca199c2-eff1-4671-8600-d80788e49e52/2022%24%24FWC%24%241438">the agreement</a>, which remains in force until replaced. </p>
<p>Termination would mean Svitzer’s employees would be covered only by award provisions and individual contracts – an effective win for the company. (This application remains before the commission.)</p>
<h2>Will the government’s IR reforms help?</h2>
<p>With a settlement not really any closer, the Svitzer dispute demonstrates the failure of the Fair Work Act to provide a safety valve to resolve intractable disputes. </p>
<p>Employment and workplace relations minister Tony Burke has argued the Albanese government’s industrial relations reforms – yet to pass the Senate – will assist in a dispute like Svitzer. </p>
<p>They will help, but on their own will not be enough.</p>
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Read more:
<a href="https://theconversation.com/employers-say-labors-new-industrial-relations-bill-threatens-the-economy-denmark-tells-a-different-story-193311">Employers say Labor's new industrial relations bill threatens the economy. Denmark tells a different story</a>
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<p>The amendments will remove the ability to seek termination of an existing agreement while bargaining for a new agreement. This provision was not intended to be used as leverage during a dispute, as Svitzer has done. </p>
<p>The amendments also propose a new “intractable dispute mechanism”. This is different from current provisions because it does not require anyone to threaten or take potentially damaging industrial action before a party can seek arbitration by the commission.</p>
<h2>More fixes needed</h2>
<p>However, the bill does nothing to improve the Fair Work Act’s weak requirements for parties to bargain in “good faith”. This will continue to enable surface bargaining, leading to protracted disputes. </p>
<p>The provisions policing industrial action will still be among the most complex and costly in the developed world.</p>
<p>To ensure the Fair Work Commission is seen a fair and reasonable arbitrator, its members (appointed by the federal government) must also better reflect society, to restore faith in the institution for all parties concerned. Otherwise, unions may continue to resist arbitration, fearing the outcome will favour employers.</p>
<p>Moreover, despite the proposed expansion of multi-employer bargaining, the Albanese government has committed to maintaining the primacy of enterprise-level bargaining. </p>
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Read more:
<a href="https://theconversation.com/a-mandate-for-multi-employer-bargaining-without-it-wages-for-the-low-paid-wont-rise-193829">A mandate for multi-employer bargaining? Without it, wages for the low paid won't rise</a>
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<p>So suppressing workers’ pay and conditions will continue to be strategy to obtain a competitive advantage over other businesses. (Svitzer has argued its 2016 agreement means it cannot compete for port contracts.) </p>
<p>While the focus of our system remains the single enterprise, and workers’ pay and conditions can be used to undercut competitors, disputes like the one at Svitzer will continue to feature in the industrial landscape.</p><img src="https://counter.theconversation.com/content/194818/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Shae McCrystal receives funding from the Australian Research Council. </span></em></p>The Albanese government’s industrial relations reforms will help avoid protracted industrial conflict, but more is needed.Shae McCrystal, Professor of Labour Law, University of SydneyLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1947432022-11-17T05:35:18Z2022-11-17T05:35:18ZDeliveroo’s exit from Australia shows why gig workers need more protection<figure><img src="https://images.theconversation.com/files/495759/original/file-20221116-15-8m3al5.jpg?ixlib=rb-1.1.0&rect=0%2C1042%2C3955%2C1950&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">
</span> <span class="attribution"><span class="source">Shutterstock</span></span></figcaption></figure><p>Deliveroo’s decision to quit the Australian market, after what have been boom times for food delivery platforms, may seem surprising. But the writing has been on the wall for some time.</p>
<p>The British-based platform – one of the first to start operating in Australia – <a href="https://riders.deliveroo.com.au/en/news/20221116">announced yesterday</a> it was going into voluntary administration.</p>
<p>It cited “challenging economic conditions” and an inability to achieve “a sustainable position of leadership in the market” as key reasons for its decision. </p>
<p>Creditors must now await decisions by the appointed administrator, KordaMentha, about how much of the money they are owed will be paid. </p>
<p>Crucially, those potentially out of pocket include up to <a href="https://www.abc.net.au/news/2022-11-16/deliveroo-enters-voluntary-administration/101661932">15,000 couriers</a> who worked for the platform as independent contractors.</p>
<p>They are not officially employees, so they are not covered by the federal government’s <a href="https://extranet.employment.gov.au/feg%3C/u">Fair Entitlement Guarantee</a>, which ensures workers left in the lurch by an employer declaring insolvency can receive some of their unpaid wages, annual leave and other entitlements. </p>
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<strong>
Read more:
<a href="https://theconversation.com/guilt-shame-dissatisfaction-workers-and-customers-on-the-gig-economy-and-how-to-make-it-better-185502">Guilt, shame, dissatisfaction: workers and customers on the gig economy (and how to make it better)</a>
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<h2>Challenging economic conditions</h2>
<p>Globally, Deliveroo has been exiting countries where it is not in a “sustainable position of leadership” — that is, effectively being one of the two largest players in the food delivery market. </p>
<p>It has already shut its operations in <a href="https://www.reuters.com/article/us-deliveroo-germany-idUSKCN1V215I">Germany</a> (2019), <a href="https://corporate.deliveroo.co.uk/media/deliveroo-announces-proposal-end-operations-spain/%3C/U">Spain</a> (2021), and <a href="https://corporate.deliveroo.co.uk/media/deliveroo-announces-decision-end-operations-netherlands/%3C/U">the Netherlands</a> (2022). </p>
<p>Deliveroo’s Australian operations were also considered a <a href="https://finance.yahoo.com/news/deliveroo-rises-announcing-exit-australia-033801039.html">drag on the UK company’s stock price</a>. Despite being among the first app-based food delivery platforms in Australia, beginning in 2015, it has not been in a market leading position since 2016-17.</p>
<p>It sought to differentiate itself as a niche player, working only with “high-quality” restaurants while promising quick deliveries to consumer. In Australia, though, this model struggled against competitors delivering from a greater variety of restaurants with more couriers making deliveries.</p>
<h2>Cutthroat market dynamics</h2>
<p>Deliveroo’s exit highlights the cutthroat market dynamics of the on-demand gig economy. </p>
<p>COVID-19 restrictions were a heyday for it and its fellow food delivery platforms (Uber, DoorDash, Foodora and Menulog).</p>
<p>Demand for food deliveries boomed during lockdowns. So did the supply of labour, as those laid off from other jobs — especially temporary migrants excluded from JobKeeper and JobSeeker benefits — sought alternative work. </p>
<p>But profits in boom times aren’t guaranteed to continue. Inflation is hitting consumers’ discretionary spending and the era of “<a href="https://www.cnbc.com/2022/05/18/what-comes-after-easy-money-era-ends-for-cash-burning-tech-companies.html">cheap money</a>” is ending. </p>
<p>Platforms have often had to offer their services at a loss to increase or sustain market share. This is in part because consumers of food delivery services are highly price-sensitive, as our <a href="https://doi.org/10.1016/j.jocm.2020.100254">research has found</a>. </p>
<h2>Greater regulation coming</h2>
<p>Another key local factor likely to have influenced Deliveroo’s decision is the prospect of greater regulation.</p>
<p>The Albanese government has promised to improve conditions for gig workers. This includes <a href="https://treasury.gov.au/sites/default/files/inline-files/Jobs-and-Skills-Summit-Outcomes-Document.pdf">legislation</a> to give the federal industrial relations umpire, the Fair Work Commission, the power to regulate “employee-like” forms of work. </p>
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Read more:
<a href="https://theconversation.com/how-australias-gig-workers-may-remain-contractors-under-labor-186197">How Australia's gig workers may remain contractors under Labor</a>
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<p>Currently the commission can only adjudicate on matters affecting employees. The government’s approach is to avoid the seemingly endless classification debates and instead provide all workers with greater protections.</p>
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<em>
<strong>
Read more:
<a href="https://theconversation.com/an-employee-not-a-contractor-unfair-dismissal-ruling-against-deliveroo-is-a-big-deal-for-australias-gig-workers-161173">An employee, not a contractor: unfair dismissal ruling against Deliveroo is a big deal for Australia's gig workers</a>
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<p>Giving platform workers greater benefits and protections as employee-like workers – in whatever form this takes – will increase costs. But Deliveroo’s exit highlights just why greater protection for workers in the “gig” economy is needed. </p>
<p>It’s now up to the Albanese government to make meaningful, innovative reforms.</p><img src="https://counter.theconversation.com/content/194743/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Alex Veen is part of a research team that received a University of Sydney Business School Industry Partnership grant. Uber Technologies is a Partner Organisation on this grant and provided a minority financial contribution to the project. He further receives funding from the Australian Research Council in the form a Discovery Early Career Researcher Award (DECRA) for his project entitled 'Algorithmic management and the future of work: lessons from the gig economy.'</span></em></p><p class="fine-print"><em><span>Caleb Goods is part of a research team that received a University of Sydney Business School Industry Partnership grant. Uber Technologies is a Partner Organisation on this grant and provided a minority financial contribution to the project.</span></em></p><p class="fine-print"><em><span>Tom Barratt has been awarded a Discovery Early Career Researcher Award from the Australian Research Council to investigate Work Fragmentation and the Gig Economy, commencing in 2023.
Tom Barratt is part of a research team that received a University of Sydney Business School Industry Partnership grant. Uber Technologies is a Partner Organisation on this grant and provided a minority financial contribution to the project.</span></em></p>Deliveroo says it has been unable to achieve a sustainable position in the Australian market.Alex Veen, Senior Lecturer and DECRA Fellow, University of SydneyCaleb Goods, Senior Lecturer - Management and Organisations, UWA Business School, The University of Western AustraliaTom Barratt, Senior lecturer, The University of Western AustraliaLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1901312022-09-18T20:14:40Z2022-09-18T20:14:40ZDespite high hopes, multi-employer bargaining is unlikely to ‘get wages moving’<figure><img src="https://images.theconversation.com/files/485018/original/file-20220916-24-cgjlzr.jpg?ixlib=rb-1.1.0&rect=6%2C440%2C3132%2C1460&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">
</span> <span class="attribution"><span class="source">The Conversation</span></span></figcaption></figure><p>One of the key measures announced to “get wages moving” in the wake of the federal government’s jobs summit was greater access to <a href="https://ministers.dewr.gov.au/burke/modernising-workplace-relations-laws-get-wages-moving">multi-employer agreements</a>.</p>
<p>At the moment, most workers get their wages adjusted by bargaining with individual employers, so-called “<a href="https://www.fairwork.gov.au/tools-and-resources/fact-sheets/rights-and-obligations/enterprise-bargaining">enterprise bargaining</a>”.</p>
<p>Others rely on awards and the minimum wage, set by the <a href="https://www.fwc.gov.au/agreements-awards/awards">Fair Work Commission</a>.</p>
<p>Multi-employer agreements would allow workers in particular occupations to bargain with their employers as a group, rather than employer by employer.</p>
<p>If multi-employer agreements were clearly a good way to get real wages moving, we would expect to see real wages growing more strongly in countries that allow multi-employer bargaining than in those that don’t.</p>
<h2>Which system lifts wages more?</h2>
<p>To find out, I examined the measure of average annual wages per full-time and full-year-equivalent employee assembled by the Organisation for Economic Co-operation and Development, available at <a href="https://stats.oecd.org">OECD.stat</a>.</p>
<p>The OECD measure is derived from national accounts data, making it different to the <a href="https://www.abs.gov.au/statistics/economy/price-indexes-and-inflation/wage-price-index-australia/latest-release">wage price index</a> commonly quoted in Australia, which comes from a survey of employers and at the moment shows real wage growth <a href="https://theconversation.com/proof-positive-real-wages-are-shrinking-these-figures-put-it-beyond-doubt-183343">negative</a>.</p>
<p>The measure I used has the advantage of including the effect of wage increases from promotions, annual increments and job changes, making it a better guide to the experience of workers than the wage price index, which merely records the rate at which the wages attached to particular positions grows.</p>
<h2>17 countries compared</h2>
<p>Less helpfully, because the OECD data is an average of all wages paid it can be affected by changes in the composition of the workforce. As an example, a rapid growth in employment concentrated in low-income jobs can make it look as if wage growth is slowing when it isn’t.</p>
<p>The OECD assigns countries to one of two groups:</p>
<ul>
<li><p>those in which bargaining occurs mainly at the company level </p></li>
<li><p>those in which collective bargaining takes place with multiple employers, most often from the same industry, but sometimes from firms in the same region.</p></li>
</ul>
<p>Not all countries fit neatly into these categories. Australia is one such exception, relying on centrally-set awards and a minimum wages in addition to employer by employer (and sometimes occupation by occupation) negotiations.</p>
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<strong>
Read more:
<a href="https://theconversation.com/are-real-wages-falling-heres-the-evidence-182171">Are real wages falling? Here's the evidence</a>
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<p>After omitting countries without comparable wages data, I found 14 countries where multi-employer bargaining dominates, and 12 where company-level bargaining dominates. </p>
<p>Examining the period 2011-21, I found that across the multi-employer bargaining countries, real wages growth averaged only 0.6% per year. </p>
<p>In contrast, among those in the company bargaining group, average real wage growth was about four times a high, at 2.3% per annum.</p>
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<p>
<em>
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Read more:
<a href="https://theconversation.com/real-wages-are-shrinking-these-figures-put-it-beyond-doubt-183343">Real wages are shrinking, these figures put it beyond doubt</a>
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<p>But the company-bargaining group included many Eastern European countries which have greater room for productivity growth and thus wage increases. </p>
<p>Excluding these from both groups, I found that in the countries where multi-employer bargaining dominated, real wage growth averaged 0.7% per year.</p>
<p>Where company bargaining dominated, real wage growth averaged 1.1%.</p>
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<p>Australia, which, along with Luxembourg, fits into neither category, had real wage growth of 0.4%.</p>
<p>These calculations are not consistent with the claim that multi-employer bargaining boosts real wages growth. If anything, they suggests the reverse.</p>
<h2>We will need to try other things</h2>
<p>But this isn’t to say Australia’s system of enterprise bargaining can’t be improved. The post-summit bipartisan commitment to reform the <a href="https://www.fwc.gov.au/better-off-overall-test">Better Off Overall Test</a> that is applied to enterprise agreements holds potential.</p>
<p>Researchers at the <a href="https://www.e61.in/jobsandskillssummit">E61 Institute</a> have identified another problem ripe for attention: an apparent decoupling of wages from firm performance. </p>
<p>Multi-employer bargaining is unlikely to be able to address this; indeed it could make it worse.</p>
<hr>
<p>
<em>
<strong>
Read more:
<a href="https://theconversation.com/if-the-pm-wants-wage-rises-he-should-start-with-the-1-6-million-people-on-state-payrolls-188904">If the PM wants wage rises, he should start with the 1.6 million people on state payrolls</a>
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<p>We also need to recognise that in an economy increasingly dominated by services, getting real wage gains from productivity gains <a href="https://theconversation.com/summit-cheat-sheet-what-is-productivity-and-how-well-does-it-measure-what-we-do-189548">becomes difficult</a>. </p>
<p>Nowhere is this clearer than in the public sector, where teachers and nurses face wages set by government employers and in sectors such as aged care and childcare where governments help pay and effectively set wages.</p>
<p>The main obstacle to higher wage growth in these sectors is not enterprise bargaining, but simply an unwillingness on the part of governments (on behalf of taxpayers) to stump up the cash.</p><img src="https://counter.theconversation.com/content/190131/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Mark Wooden is also a part-time member of the Fair Work Commission’s Expert Panel responsible for the Annual Wage Review. This piece, however, is written in his capacity as a professor of the University of Melbourne. None of the views expressed here should be attributed to either the Fair Work Commission or the University of Melbourne. </span></em></p>A comparison of 17 OECD countries shows those with multi-employer bargaining had worse wage outcomes than those enterprise bargaining.Mark Wooden, Professorial Fellow, The University of MelbourneLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1889042022-08-23T05:58:42Z2022-08-23T05:58:42ZIf the PM wants wage rises, he should start with the 1.6 million people on state payrolls<p>If Prime Minister Anthony Albanese really wants to boost wage growth, there’s a simple way to do it. </p>
<p>And if he did that one simple thing, analysis prepared for The Conversation shows some of our <a href="https://www.roymorgan.com/findings/8691-image-of-professions-2021-april-2021-202104260655">most trusted</a> but least well-paid workers – teachers and nurses – could be among the wage winners.</p>
<p>During the election campaign, the Labor leader made a public push for wages growth. He held aloft a $1 coin and said that’s what his government would be asking for: a boost in the minimum wage from $20.33 an hour to $21.36, which would lift it <a href="https://www.youtube.com/watch?v=tS0SwaPDFRc">5.1%</a>, which was the inflation rate at the time.</p>
<p>After the election that’s what the government asked for. The Fair Work Commission delivered slightly more for Australia’s lowest-paid – an increase of <a href="https://www.fwc.gov.au/documents/wage-reviews/2021-22/decisions/2022-fwc-3501-summary.pdf">5.2%</a> – and somewhat less for higher earners: an increase of 4.6%.</p>
<p>Then the inflation rate climbed to 6.1%. That figure, for the year to June, far eclipsed total wage growth of 2.6% over the same period and rendered even what the commission had delivered out of date, sending real (inflation adjusted) wages backwards by the most in 25 years.</p>
<figure class="align-center zoomable">
<a href="https://images.theconversation.com/files/480269/original/file-20220822-18038-cpqei8.png?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/480269/original/file-20220822-18038-cpqei8.png?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/480269/original/file-20220822-18038-cpqei8.png?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=312&fit=crop&dpr=1 600w, https://images.theconversation.com/files/480269/original/file-20220822-18038-cpqei8.png?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=312&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/480269/original/file-20220822-18038-cpqei8.png?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=312&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/480269/original/file-20220822-18038-cpqei8.png?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=393&fit=crop&dpr=1 754w, https://images.theconversation.com/files/480269/original/file-20220822-18038-cpqei8.png?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=393&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/480269/original/file-20220822-18038-cpqei8.png?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=393&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
<figcaption>
<span class="caption">Anthony Albanese holds aloft a $1 coin to argue for a $1 increase in the minimum wage.</span>
<span class="attribution"><a class="source" href="https://www.youtube.com/watch?v=tS0SwaPDFRc">ABC Insiders, May 15, 2022</a></span>
</figcaption>
</figure>
<p>Next week’s <a href="https://www.pm.gov.au/media/jobs-and-skills-summit-be-held-september">Jobs Summit</a> is, in part, an attempt to do something about wages. But the <a href="https://treasury.gov.au/sites/default/files/2022-08/2022-302672-ip_0.pdf">issues paper</a> released ahead of the summit is curiously bereft of ideas about how.</p>
<p>The paper says wages have traditionally climbed with labour productivity (which is output per hour worked) and that productivity growth has fallen to its lowest in 50 years.</p>
<p>It says if businesses invested more in labour-saving technology and workers got a better mix of skills, productivity growth would climb, but (and it’s a big but) that growth would only flow through to wages “<a href="https://treasury.gov.au/sites/default/files/2022-08/2022-302672-ip_0.pdf">over the medium term</a>”.</p>
<p>Which leaves… not much happening for wages in the meantime.</p>
<h2>Silent on what the states should do</h2>
<p>The other things the paper notes are that fewer workers are covered by enterprise agreements and more by Fair Work Commission awards (presumably because enterprise agreements have expired, or aren’t high enough) and that 23% of workers are casuals (a figure that <a href="https://www.aph.gov.au/%20About_Parliament/Parliamentary_Departments/Parliamentary_Library/pubs/rp/rp1415/Quick_Guides/CasualEmploy">hasn’t changed much</a> in 20 years).</p>
<p>What the summit paper doesn’t mention, but ought to, is that governments set wages – the wages of their own employees.</p>
<p>The lowest-paid quarter of the workforce has its wages set by the Fair Work Commission, either via the minimum wage or awards. </p>
<p>The Fair Work Commission looks after these people by usually increasing their wages in line with the consumer price index, and often by more.</p>
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<hr>
<h2>Private employers are offering more, where they can</h2>
<p>Most of the rest of the workforce gets only what their employers agree to, and the good news here is that, increasingly, employers are offering more.</p>
<p>Two years ago, as COVID took hold, the private employers who did lift wages offered an average of 0.8%. One year later, in the year to June 2021, they offered 2.7%. In the year to June this year they offered <a href="https://www.abs.gov.au/statistics/economy/price-indexes-and-inflation/wage-price-index-australia/jun-2022">3.8%</a>.</p>
<p>Of course many private employers can’t offer much. They are small, and are being squeezed by soaring costs.</p>
<hr>
<p>
<em>
<strong>
Read more:
<a href="https://theconversation.com/are-real-wages-falling-heres-the-evidence-182171">Are real wages falling? Here's the evidence</a>
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<hr>
<p>But governments budget in billions, and can afford to offer whatever they think they should, covering it with tax or borrowing.</p>
<p>The Commonwealth government, under Albanese, employs one quarter of a million Australians. The states, with whom Albanese could have a word, employ 1.6 million – many of them teachers and nurses.</p>
<p>Yet far from increasing their wages in line with inflation, or even in line with private sector increases, Australia’s states have been extraordinarily stingy.</p>
<h2>Governments are offering as little as 1.5%</h2>
<p>Victoria’s wages policy, announced in January, is for a cap on annual increases of <a href="https://www.vic.gov.au/moving-new-wages-policy-2022">1.5%</a>. Western Australia, despite its large budget surplus, was limiting increases to <a href="https://www.commerce.wa.gov.au/sites/default/files/atoms/files/public_sector_wages_policy_statement_2022.pdf">2.5%</a>. In July it lifted the offer to <a href="https://www.mediastatements.wa.gov.au/Pages/McGowan/2022/07/Enhanced-changes-to-WA-public-sector-wages-policy.aspx">3%</a> with a one-off $2,500 cost of living payment.</p>
<p>NSW has a ceiling of <a href="https://arp.nsw.gov.au/assets/ars/attachments/NSW-Public-Sector-Wages-Policy-2022.pdf">3%</a>, which falls back to 2.5% after two years. (And the NSW ceiling is lower than it seems. It includes employers’ super contributions, which are to climb by 0.5 percentage points a year for the next few years, making the quoted ceiling of 3% a ceiling of 2.5% for take-home pay.)</p>
<p>Using Bureau of Statistics figures to examine the increases actually paid (as opposed to offered) shows Western Australian public sector wages climbed just <a href="https://www.abs.gov.au/statistics/economy/price-indexes-and-inflation/wage-price-index-australia/jun-2022/634504b.xlsx">1.1%</a> in the year to June. South Australian public sector wages climbed 1.7%. </p>
<p>In Victoria and NSW, the increases were 2% and 2.1%. Only Queensland, which shelled out 4%, paid anything approaching the rate of inflation.</p>
<h2>Nurses and teachers hit hard</h2>
<p>This stinginess hits most the two biggest groups of state government employees: teachers and nurses.</p>
<p>Whereas public wages as a whole climbed 2.4% over the past year, the wages of public education and training workers climbed <a href="https://www.abs.gov.au/statistics/economy/price-indexes-and-inflation/wage-price-index-australia/jun-2022/634509b.xlsx">2.2%</a>.</p>
<p>A Bureau of Statistics breakdown prepared for The Conversation shows that in NSW and Victoria those workers (mainly teachers) got just 2%. In Victoria, health care and social assistance workers (largely nurses) got <a href="https://cdn.theconversation.com/static_files/files/2262/Wage_Price_Index_Jun22_Peter_Martin.xlsx">1.7%</a>. </p>
<p><a href="https://onlinelibrary.wiley.com/doi/10.1111/1467-8454.00124">Economic research</a> suggests the states are stingy, in part because they can be. They are the only big employer of nurses, teachers, police and public servants. </p>
<h2>The PM could have a word</h2>
<p>If Albanese means what he says about wages keeping pace with inflation, his next step should be to ask his mates in the states to do more. Most of the premiers are from his side of politics. All of them will be at the Jobs Summit.</p>
<p>There are signs he is putting his own house in order. His departments have been told not to enter into new agreements while the previous penny-pinching wages policy is <a href="https://www.apsc.gov.au/initiatives-and-programs/workplace-relations/public-sector-workplace-relations-policy-2020">under review</a>, and he has backed a big rise for aged care workers (whose wages the Commonwealth funds) in a <a href="https://www.fwc.gov.au/documents/sites/work-value-aged-care/submissions/am202099-63-65-sub-aust-govt-080822.pdf">submission</a> to the Fair Work Commission.</p>
<p>But going easy on the states, as he has so far, while telling private sector employers with far smaller financial resources to lift wages, makes it look as if he is not serious.</p>
<p>If he genuinely believes wages ought to keep pace with inflation, he ought to name and shame his Labor mates.</p><img src="https://counter.theconversation.com/content/188904/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Peter Martin does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Governments budget in billions. Yet analysis prepared for The Conversation shows they’ve been extraordinarily stingy with pay rises – particularly when it comes to teachers and nurses.Peter Martin, Visiting Fellow, Crawford School of Public Policy, Australian National UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1889872022-08-23T05:29:55Z2022-08-23T05:29:55ZUnfair dismissal rulings show personal circumstances matter in vaccine refusals<figure><img src="https://images.theconversation.com/files/480295/original/file-20220822-2925-bipvq2.jpg?ixlib=rb-1.1.0&rect=0%2C985%2C5868%2C2920&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">
</span> <span class="attribution"><span class="source">Shutterstock</span></span></figcaption></figure><p>While legal challenges against federal and state vaccine mandates have come to nothing, in recent months two Australian workers have won unfair dismissal cases after being sacked for not complying with their employer’s vaccination orders.</p>
<p>These wins in the federal industrial relations tribunal, the Fair Work Commission, confirm employers do not have carte blanche to insist employees be vaccinated.</p>
<p>The victories do not signal a “change in the narrative” – or that future legal claims against government mandates in other courts may succeed. But they do affirm and refine principles previously applied in vaccination-related cases heard by the commission. </p>
<p>The cases have turned on matters of procedure. </p>
<p>The commission’s rulings have confirmed the general validity of employer-imposed vaccination policies but highlighted the need for fair processes when applying such policies.</p>
<p>Key to these two unfair dismissal rulings were that the employers went about things the wrong way and failed to consider individual circumstances. </p>
<h2>Robyn Pskiet vs Nocelle Foods</h2>
<p>One <a href="https://www.fwc.gov.au/document-search/view/aHR0cHM6Ly9zYXNyY2RhdGFwcmRhdWVhYS5ibG9iLmNvcmUud2luZG93cy5uZXQvZGVjaXNpb25zLzIwMjIvMDcvUFI3NDQxNjgyNTA1NTA4NGQ0ZTE5ZWI2LTUzN2YtNDY1NS1iNjRkLWJjMzk4OTVhNDFhY2Q2NjYyMzMzLTEzNDctNDU5NC04ZWQxLTE3ZDcwNTg4YWU5Ni5wZGY1/1/b5f9d236-c75f-4dfa-9834-2ced45b46855/Pskiet">case</a> involved Adelaide woman Robyn Pskiet, sacked on 12 January 2022 by Nocelle Foods, a food wholesaler and distributor. </p>
<p>Pskiet was working as a quality assurance manager alongside about 60 office and factory workers at Nocelle’s Adelaide factory. She had been with the company since 2005.</p>
<p>The company told staff in late November 2021 it was considering implementing a COVID vaccination policy, due to workplace health and safety concerns and increasing levels of community transmission after South Australia opened its borders on November 22. </p>
<p>It implemented its vaccination policy on December 29. Staff were required to show evidence of their first vaccination by January 10 2022. Pskiet was dismissed for failing to provide a vaccination certificate or medical exemption. </p>
<p>Pskiet’s case to the Fair Work Commission was that she was concerned about the safety of then available COVID vaccines but willing to take a “safer vaccine”, such as Novavax, which the Therapeutic Goods Administration did not provisionally approve until <a href="https://www.tga.gov.au/media-release/tga-provisionally-approves-novavax-biocelect-pty-ltds-covid-19-vaccine-nuvaxovid">January 20 2022</a>.</p>
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Read more:
<a href="https://theconversation.com/havent-yet-been-vaccinated-for-covid-novavax-might-change-your-mind-176694">Haven't yet been vaccinated for COVID? Novavax might change your mind</a>
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<p>She argued Nocelle’s vaccination policy was not reasonable or lawful because it did not give her the option to work from home or grant her leave until Novavax was approved. </p>
<p>Commissioner Peter Hampton agreed. </p>
<p>He ruled Nocelle Foods’ vaccination policy was a lawful and reasonable direction, and refusing to comply was a valid basis for termination. But Pskiet’s dismissal was still unfair, because of her position and long-standing service, and the timing and manner of applying the policy to her. </p>
<p>He said “proper consideration of her circumstances” could have avoided, or at least delayed, the need to sack Pskiet.</p>
<p>He ordered the company to compensate her $3,462 plus superannuation. He did not, however, order the company to reinstate Pskiet – the first option when workers win unfair dismissal cases.</p>
<h2>Bradley Dean vs Rex Airlines</h2>
<p>The second unfair dismissal case involved pilot Bradley Dean, <a href="https://www.fwc.gov.au/document-search/view/aHR0cHM6Ly9zYXNyY2RhdGFwcmRhdWVhYS5ibG9iLmNvcmUud2luZG93cy5uZXQvZGVjaXNpb25zLzIwMjIvMDcvRGVhbnZSZWdpb25hbEV4cHJlc3NIb2xkaW5ncy1EZWNpc2lvbjI0NDc1ODM0MmQ4NDVmMzgtYjI5OC00OWI1LWEzMzItNzEyOWVhOWJkOTQ3N2QwZTM1MGMtMmE1YS00ZmI4LWI0ZTgtNjI4Nzg1NzFlZGMxLnBkZg2/1/d7f5ccdf-bd46-4d0a-86c9-6e9d56698df2/Bradley%24%24John%24%24Dean%24%24Regional%24%24Express%24%24holdings%24%24ltd">sacked by regional airline Rex</a>, on December 1 2021, after 27 years of service, for breaching a policy requiring staff members to be fully vaccinated by November 1. </p>
<p>Dean’s position was similar to Pskiet’s. He wanted to wait for the Novavax vaccine. He asked to be given alternative duties – for example, working as a flight simulator – and requested more time to get vaccinated. </p>
<p>In finding for Dean, Commissioner Donna McKenna ruled the airline could validly dismiss an employee for failing to be vaccinated, but the way it had treated Dean had been unfair. </p>
<p>Rex’s failure to comply with procedural considerations included not discussing options to dismissal, despite assuring Dean it would. </p>
<p>Dean received his two Novavax vaccinations once they became available, after he was sacked. Commissioner McKenna ordered his reinstatement, with no loss in continuity of service. </p>
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Read more:
<a href="https://theconversation.com/qantas-has-grounds-to-mandate-vaccination-but-most-blanket-policies-wont-fly-166416">Qantas has grounds to mandate vaccination, but most blanket policies won't fly</a>
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<h2>Individual circumstances matter</h2>
<p>A key message from these rulings is that employers making COVID vaccination a condition of employment is generally lawful and reasonable – at least where COVID remains a significant hazard and workers are in roles requiring proximity to others. </p>
<p>These principles were affirmed in a December 2021 <a href="https://www.fwc.gov.au/documents/decisionssigned/html/2021fwcfb6059.htm">decision</a> of the
Fair Work Commission’s full bench.</p>
<p>In that case, the Construction, Forestry, Maritime, Mining and Energy Union successfully challenged a vaccine policy introduced by the BHP subsidiary operator of the Mt Arthur coal mine in NSW’s Hunter Valley.</p>
<p>The full bench agreed the vaccination mandate was unreasonable because the employer had failed to properly consult with employees in introducing the policy – but confirmed the general validity of vaccination policies.</p>
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Read more:
<a href="https://theconversation.com/bhps-vaccine-policy-not-lawful-and-reasonable-but-this-is-no-win-for-mandate-opponents-173234">BHP's vaccine policy 'not lawful and reasonable' – but this is no win for mandate opponents</a>
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<p>Procedure also counts when it comes to dismissing an employee for failing to comply with a vaccination requirement. The same general principles have also been upheld in unfair dismissal cases concerning mandatory influenza vaccination policies.</p>
<p>Employers can have a general vaccination policy but must treat every individual case on its own merits and circumstances – including the timing and manner of applying the vaccination policy to the particular employee.</p>
<p>Extra latitude must be given to longer serving, senior employees or those with good performance records.</p><img src="https://counter.theconversation.com/content/188987/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Giuseppe Carabetta does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Fair Work Commission rulings on employer vaccination mandates highlight the need for fair processes.Giuseppe Carabetta, Associate professor, University of Technology SydneyLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1860442022-06-29T08:30:37Z2022-06-29T08:30:37ZWhat’s driving Uber’s historic agreement with the TWU on gig work<p>Uber Australia has struck a historic agreement with the Transport Workers’ Union – a <a href="https://www.twu.com.au/general/twu-signs-breakthrough-charter-with-uber-in-support-of-enforceable-rights/">statement of principles</a> that re-regulate work in the Australian rideshare and food delivery industry. </p>
<p>This is a major shift to industrial relations in the gig economy. </p>
<p>Uber and its rival platforms have largely treated their workforce as independent contractors, not employees with rights to benefits such as sick leave, minimum wages or union representation.</p>
<p>Now the poster company of the gig economy has agreed with the union that workers on the platform should receive some baseline conditions. </p>
<h2>What Uber and the Transport Workers’ Union agree on</h2>
<p>First, and most importantly, Uber and the Transport Workers’ Union have agreed to support the creation of an independent umpire, potentially as part of the Fair Work Commission, to apply minimum standards and practices across the industry. </p>
<p>There are four key objectives.</p>
<p>First, an enforceable floor around earnings, to give transparency to drivers and ensure platforms don’t seek to compete by driving down labour costs. Earnings are a <a href="https://journals.sagepub.com/doi/full/10.1177/0022185618817069">critical concern</a> for gig workers. </p>
<p>Second, enhanced and low-cost opportunities for workers to resolve disputes via an independent umpire. Gig workers, as contractors, currently have little recourse to <a href="https://theconversation.com/delivery-workers-are-now-essential-they-deserve-the-rights-of-other-employees-134406">address grievances</a>. </p>
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Read more:
<a href="https://theconversation.com/delivery-workers-are-now-essential-they-deserve-the-rights-of-other-employees-134406">Delivery workers are now essential. They deserve the rights of other employees</a>
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<p>Third, the right for workers to collectively organise and be represented by a union.</p>
<p>Fourth, the effective enforcement of these and other standards, including occupational health and safety compliance. </p>
<p>Beyond these key principles, Uber and the Transport Workers’ Union have also agreed to have an ongoing conversation about making these principles work in reality, not just on paper.</p>
<h2>Why now?</h2>
<p>The Uber-Transport Workers’ Union statement of principle follows the union signing a similar <a href="https://doordash.news/australia/doordash-and-transport-workers-union-sign-charter-of-principles-to-ensure-safety-and-fairness-for-gig-workers-in-australia/">joint charter with DoorDash</a> in May.</p>
<p>Given DoorDash has been operating in Australia <a href="https://www.cmo.com.au/article/665956/doordash-launches-australia">since 2019</a>, and Uber <a href="https://www.industry.gov.au/data-and-publications/uber-in-australia">since 2012</a>, why are they making these voluntary agreements to pursue improved working conditions now?</p>
<p>The answer seems reasonably obvious: the Morrison government, which had little enthusiasm for regulating the gig economy, has been replaced by the Albanese government, which has <a href="https://theconversation.com/anthony-albaneses-plan-to-boost-protections-for-australians-in-insecure-work-154953">signalled it will</a>.</p>
<p>The new Labor government’s <a href="https://www.abc.net.au/news/2022-06-06/gig-workers-insecure-employment-labor-changes/101126858">plans for the gig economy</a> and employee-like work arrangements include giving the Fair Work Commission the power to regulate “employee-like” forms of work. </p>
<p>The exact details and timeline for these reforms have not been announced.</p>
<p>These union-platform agreements suggest that platforms are keen to get in front of, and potentially shape, this regulation agenda.</p>
<h2>No more debating classification</h2>
<p>Critically, unions and platforms working together may mean the end of the classification debates – employee versus independent contractor – that <a href="https://theconversation.com/redefining-workers-in-the-platform-economy-lessons-from-the-foodora-bunfight-107369">have been fought out</a> in the Fair Work Commission and the courts over the past five years.</p>
<p>As we have <a href="https://theconversation.com/why-gig-workers-may-be-worse-off-after-the-fair-work-ombudsmans-action-against-foodora-98242">suggested previously</a>, the debates over whether workers treated as independent contractors should actually have been classified as employees have largely been a dead-end. They may have even harmed workers, as platforms have sought to avoid doing anything the Fair Work Commission or a court might interpret as indicative of an employer-employee relationship.</p>
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Read more:
<a href="https://theconversation.com/did-somebody-say-workers-rights-three-big-questions-about-menulogs-employment-plan-158942">Did somebody say workers' rights? Three big questions about Menulog's employment plan</a>
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<p>This agreement represents a different approach that may produce better outcomes. It should help platforms avoid the cost and reputational damage of ongoing litigation. It also helps the union. <a href="https://cdn.hcourt.gov.au/assets/publications/judgment-summaries/2021/hca-23-2021-08-04.pdf">Recent High Court rulings</a> have made it harder for the union to recruit, organise and represent gig workers. This agreement implicitly accepts the union’s right to represent those workers.</p>
<h2>Setting the agenda</h2>
<p>These statements of principles also strongly align with the Albanese government’s <a href="https://www.alp.org.au/policies/secure-australian-jobs-plan">proposal</a> to imporve the conditions of “employee-like work.”</p>
<p>Uber and Doordash appear to be embracing self-regulation to help set the agenda around what is (and importantly what is not) included in the new regulations for employee-like work arrangements. </p>
<p>The future of gig work is looking very different from what it did a few months ago.</p><img src="https://counter.theconversation.com/content/186044/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Caleb Goods is part of a research team that received a University of Sydney Business School Industry Partnership grant. Uber Technologies is a Partner Organisation on this grant and provided a minority financial contribution to the project.</span></em></p><p class="fine-print"><em><span>Alex Veen is part of a research team that received a University of Sydney Business School Industry Partnership grant. Uber Technologies is a Partner Organisation on this grant and provided a minority financial contribution to the project. He further receives funding from the Australian Research Council in the form a Discovery Early Career Researcher Award (DECRA) for his project entitled 'Algorithmic management and the future of work: lessons from the gig economy.'</span></em></p><p class="fine-print"><em><span>Tom Barratt is part of a research team that received a University of Sydney Business School Industry Partnership grant. Uber Technologies is a Partner Organisation on this grant and provided a minority financial contribution to the project.</span></em></p>Uber, the poster company of the gig economy, has agreed its Australian workers deserve more employee-like conditions. Why it has done this now isn’t too hard to work out.Caleb Goods, Senior Lecturer - Management and Organisations, UWA Business School, The University of Western AustraliaAlex Veen, Senior Lecturer and DECRA Fellow, University of SydneyTom Barratt, Lecturer, Centre for Work + Wellbeing, Edith Cowan UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1851172022-06-15T10:52:09Z2022-06-15T10:52:09ZThis 5.2% decision on the minimum wage could shift the trajectory for all<figure><img src="https://images.theconversation.com/files/468930/original/file-20220615-19-mp86k8.jpg?ixlib=rb-1.1.0&rect=0%2C43%2C4390%2C2162&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">
</span> <span class="attribution"><span class="source">Shutterstock</span></span></figcaption></figure><p>Barely a month ago Anthony Albanese was derided as a “<a href="https://www.abc.net.au/news/2022-05-11/morrison-accuses-albanese-of-being-a-loose-unit-on/13877512">loose unit</a>” for endorsing a 5.1% increase in the minimum wage. </p>
<p>His rationale was, with 5.1% inflation, the incomes of the lowest-paid Australians at least shouldn’t be going backwards.</p>
<p>Now the Fair Work Commission’s expert panel, which reviews the minimum wage each year, has announced a 5.2% increase. </p>
<p>A “loose” decision? No. The reasons for lifting the pay of workers on the minimum wage by $40 a week are laid out in <a href="https://www.fwc.gov.au/documents/decisionssigned/html/2022fwcfb3500.htm">a long document</a>. </p>
<p>The essence is this: even with rising inflation, the economy is strong. If we can’t lift wages to stop the lowest paid going backwards in these conditions, when will they ever rise? </p>
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<h2>Reasons for the rise</h2>
<p>The economic factors considered by the expert panel include:</p>
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<li>real wages have fallen by about 2.5% over the past two years</li>
<li>economic growth is strong and appears set to continue</li>
<li>employment and vacancies are growing </li>
<li>unemployment and underemployment are falling</li>
<li>productivity has returned to steady growth of 1–2% a year</li>
<li>profits increased by 25% in the past year. </li>
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<p>While precise estimates are difficult, the minimum wage increase will affect about 2% of Australian workers. The sectors most impacted will be <a href="https://www.fwc.gov.au/documents/wage-reviews/2019-20/research/rr12020.pdf">retail and hospitality</a>. </p>
<p>However, the <a href="https://www.fwc.gov.au/hearings-decisions/major-cases/annual-wage-reviews">Annual Wage Review</a> also decides pay rates for those on awards. This is <a href="https://www.abs.gov.au/statistics/labour/earnings-and-working-conditions/employee-earnings-and-hours-australia/latest-release#method-of-setting-pay">about 23%</a> of Australian employees (19% of males, 27% of females). To these workers the panel has granted a 4.6% pay rise.</p>
<p>This will help workers in aged care, disability care and other forms of non-government provided (but predominantly government-funded) care work. </p>
<h2>Indirect impacts</h2>
<p>For the majority of workers – about <a href="https://www.abs.gov.au/statistics/labour/earnings-and-working-conditions/employee-earnings-and-hours-australia/latest-release#method-of-setting-pay">35% of whom</a> are covered by an enterprise bargaining agreement and 38% on over-award payments or individual contracts – the decision’s impact will be indirect, though potentially significant.</p>
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Read more:
<a href="https://theconversation.com/theres-one-big-reason-wages-are-stagnating-the-enterprise-bargaining-system-is-broken-and-in-terminal-decline-183818">There's one big reason wages are stagnating: the enterprise bargaining system is broken, and in terminal decline</a>
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<p>Wage setting involves a combination of both market and institutional forces. </p>
<p>The lower bound of wages is set by the social security system – unemployment benefits, aged pensions and the like. The upper bound is set by profitability in the most prosperous enterprises. </p>
<p>Institutional forces such as employers’ policies, unions, labour laws and customary notions of “the going rate” – as well as the level of supply and demand for workers with particular skills – shape the ultimate outcome within these upper and lower bounds. </p>
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Read more:
<a href="https://theconversation.com/how-market-forces-and-weakened-institutions-are-keeping-our-wages-low-83446">How market forces and weakened institutions are keeping our wages low</a>
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<p>This is where the expert panel’s decision is significant. It has implicitly challenged the strictures placed on wage increases by both federal and state governments over the past decade. </p>
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<figcaption><span class="caption">Annual wage review 2021-22 decision.</span></figcaption>
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<h2>Protecting a principle</h2>
<p>The panel’s decision follows a long-standing principle of Australian wages policy – pursued at least since the 1990s, when enterprise bargaining became the primary basis for wage increases. </p>
<p>This principle holds that some workers don’t and never will have the capacity to bargain effectively with their employers. They need to be protected. As the decision states:</p>
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<p>We agree with the RBA’s assessment and remain of the view that moderate and regular increases in minimum wages do not result in significant disemployment effects. </p>
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<p>This point doesn’t apply just to the lowest paid. </p>
<h2>Reading the nation</h2>
<p>Most Australians are concerned about the cost of living.</p>
<p>After more than a decade of stagnant wages, people are looking for new directions. Albanese’s election campaign recognised this, and pushed the issue constantly. </p>
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Read more:
<a href="https://theconversation.com/lifting-the-minimum-wage-isnt-reckless-its-what-low-earners-need-183643">Lifting the minimum wage isn't reckless – it's what low earners need</a>
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<p>When Scott Morrison derided Albanese as a loose unit for endorsing a $40-a-week pay rise for the lowest paid, he fundamentally misread the national mood. </p>
<p>The Fair Work Commission’s expert panel has not. </p>
<p>This decision is a welcome continuation of its role to protect the lowest paid. It could well contribute to moving Australia to a trajectory of higher, but sustainable, wages growth. </p>
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Read more:
<a href="https://theconversation.com/fair-work-commission-gives-a-5-2-40-a-week-increase-in-the-minimum-wage-185119">Fair Work Commission gives a 5.2% – $40 a week – increase in the minimum wage</a>
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<img src="https://counter.theconversation.com/content/185117/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>John Buchanan does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>The Fair Work Commission has granted a pay increase to Australia’s lowest-paid workers for a good reason. Even with rising inflation, the economy is strong.John Buchanan, Professor, Discipline of Business Information Systems, University of Sydney Business School, University of SydneyLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1851192022-06-15T01:38:18Z2022-06-15T01:38:18ZFair Work Commission gives a 5.2% – $40 a week – increase in the minimum wage<p>The Fair Work Commission has announced a rise in the minimum wage of 5.2% or $40 a week, taking it to $812.60 a week or <a href="https://www.fwc.gov.au/hearings-decisions/major-cases/annual-wage-reviews/annual-wage-review-2021-22/decisions-statements">$21.38 an hour</a>. </p>
<p>The rise will take effect on July 1. </p>
<p>The increase is slightly above the increase the government had publicly supported for the minimum wage, which was 5.1%, the rate of inflation.</p>
<p>But award minimum wages will be increased by less – 4.6%, with a minimum rise of $40 a week. This means workers on award minimum wages above $869.60 per week will get a 4.6% rise, while those earning less will receive a $40 increase. The 4.6% will cut in at trade level. </p>
<p>Only the lowest paid 2% of workers are on the national minimum wage, while a further 23% receive the minimum award rates. </p>
<p>For workers generally the award increases will also take effect on July 1, except for those in aviation, hospitality, and tourism where the increases will take effect on October 1 because of what the commission describes as “exceptional circumstances” in these industries. </p>
<p>The 5.2% rise is above the latest inflation number of 5.1%. But workers face further substantial rises in inflation in coming months. </p>
<p>Reserve Bank Governor Philip Lowe said on Tuesday inflation is likely to increase to 7% by the end of the year. </p>
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<p>Employers argued for smaller increases, and the Master Grocers Association and Restaurant & Catering Australia argued for no increase, while the ACTU wanted a 5.5% increase. </p>
<p>The Albanese government said in its submission low income workers should not go backwards. In the election campaign, Albanese said he would “absolutely” support an increase for the lowest-paid to match the 5.1% inflation rate.</p>
<p>The commission said the most significant changes since last year’s decision had been the sharp increase in the cost of living and the labour market’s strengthening. “The sharp rise in inflation impacts business and workers,” it said.</p>
<p>“The low paid are particularly vulnerable in the context of rising inflation.”</p>
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<figcaption><span class="caption">Annual wage review 2021-22 decision.</span></figcaption>
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<p>“The panel accepted the need for moderation in order to contain the inflationary pressures arising from our decision,” the commission said. </p>
<p>It acknowledged the increases would mean a real wage cut for some workers on awards and some, though minor, compression of relativities.</p>
<p>“The panel concluded that given the current strength of the labour market the increases it has decided to make will not have a significant adverse effect on ‘the performance and competitiveness of the national economy’”. </p>
<p>The Commission is required by the Fair Work Act to take into account “the performance and competitiveness of the national economy, including productivity, business competitiveness and viability, inflation and employment growth”.</p>
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Read more:
<a href="https://theconversation.com/lifting-the-minimum-wage-isnt-reckless-its-what-low-earners-need-183643">Lifting the minimum wage isn't reckless – it's what low earners need</a>
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<p>Reserve Bank Governor Lowe told the ABC that the 7% expected inflation was “a very high number and we need to be able to chart a course back to 2-3% inflation”. </p>
<p>On interest rates, Lowe said it would be “reasonable” for the cash rate to reach 2.5%. But how fast that was reached or indeed, if it were reached, would be “determined by events”. </p>
<p>He said inflation would peak in the December quarter and start to come off “by the first quarter next year”. </p>
<p>“By the time we get into the second half of next year, inflation will clearly be coming down. But in the first quarter, we’ll see lower rates of headline inflation.”</p>
<p>The ACTU welcomed the wage decision but said a better system was needed to deliver wage growth more generally. ACTU Secretary Sally McManus said: “This Annual Wage Review is one tool we have to generate wage growth, but it only affects one in four workers – we need wage growth across the economy.</p>
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<p>"Clearly the current system is failing. It is unable to deliver wage increases despite low unemployment, high productivity and high profits. Working people are feeling the serious consequences of nearly 10 years of inaction by the previous government.</p>
<p>"Our country needs to take a fresh look at this problem and address it. It is not acceptable that working Australians and their families continue to go backwards while big business does so well.”</p>
<p>But the Australian Chamber of Commerce and Industry, which argued for a 3% increase, said the rises were too large.</p>
<p>It said the decisions on the minimum and award wages “will hit those industries which have been hurt the most by COVID-19 restrictions and will cost Australian businesses $7.9 billion a year. </p>
<p>"Coupled with the 0.5% increase in the superannuation guarantee from July 1, this is a significant impost for small business.”</p>
<p>ACCI chief executive Andrew McKellar said: “While some businesses have rebounded strongly in recent months, the reality is we are experiencing a multi-speed economy. Many award reliant business were severely disrupted by the COVID-19 pandemic and are only just beginning to recover. Imposing unaffordable wage increases on these small businesses will put jobs at risk, not create them.”</p><img src="https://counter.theconversation.com/content/185119/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Michelle Grattan does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>The Fair Work Commission has announced a rise in the minimum wage of 5.2% or $40 a week, taking it to $812.60 a week or $21.38 an hourMichelle Grattan, Professorial Fellow, University of CanberraLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1838182022-06-01T01:11:23Z2022-06-01T01:11:23ZThere’s one big reason wages are stagnating: the enterprise bargaining system is broken, and in terminal decline<p>Real wages in Australia have been stagnating for the better part of a decade. Now, with higher inflation, they’re declining. So what can the new Albanese government, having campaigned hard on the previous government’s failures, do about it?</p>
<p>Making a submission to Australia’s industrial relations umpire, the Fair Work Commission, to lift the minimum hourly wage from A$20.33 to A$21.36, is one thing. If that push is successful, it would help the 2% of workers paid the minimum wage, as well as the 23% (about 2.2 million workers) on awards, whose rates would also lift. </p>
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Read more:
<a href="https://theconversation.com/lifting-the-minimum-wage-isnt-reckless-its-what-low-earners-need-183643">Lifting the minimum wage isn't reckless – it's what low earners need</a>
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<p>But there’s a bigger systemic problem the Albanese government needs to address – a flaw designed and implemented by a previous Labor government. Enterprise bargaining, the mechanism introduced 30 years ago for workers to collectively negotiate better wages and conditions, is broken. </p>
<p>It’s failing low-paid workers lacking bargaining power in particular, and is a big part of the reason for such poor wages in female-dominated professions such as aged care and child care.</p>
<h2>Origin of enterprise bargaining agreements</h2>
<p>Enterprise bargaining was introduced during the Hawke-Keating Labor era in the early 1990s, in partnership with the Australian Council of Trade Unions and the support of employer groups.</p>
<p>The Business Council of Australia had lobbied strongly for an enterprise focus for negotiating employment conditions, on the basis it`was the best way to tie wage claims to gains in productivity.</p>
<figure>
<iframe width="440" height="260" src="https://www.youtube.com/embed/9d8xuDTQZ2U?wmode=transparent&start=40" frameborder="0" allowfullscreen=""></iframe>
<figcaption><span class="caption">Prime Minister Paul Keating extols enterprise bargaining in parliament on June 24 1992.</span></figcaption>
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<p>After 30 years, though, enterprise bargaining is in terminal decline, with ten years of shrinking agreement coverage in line with stagnant wages growth. </p>
<p>Research by labour law and policy experts Andrew Stewart, Jim Stanford and Tess Hardy <a href="https://australiainstitute.org.au/report/the-wages-crisis-revisited/">published in May</a> shows the total number of enterprise agreements fell by more than half between 2013 and 2021 (from 23,500 agreements to 10,000). </p>
<p>Worse, the share of employees covered by a current enterprise agreement declined from an average of 27% in 2012 to just 15% by late 2021. This is shown in the following graph.</p>
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<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/466199/original/file-20220531-14-9c8cg6.png?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/466199/original/file-20220531-14-9c8cg6.png?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=600&fit=crop&dpr=1 600w, https://images.theconversation.com/files/466199/original/file-20220531-14-9c8cg6.png?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=600&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/466199/original/file-20220531-14-9c8cg6.png?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=600&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/466199/original/file-20220531-14-9c8cg6.png?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=754&fit=crop&dpr=1 754w, https://images.theconversation.com/files/466199/original/file-20220531-14-9c8cg6.png?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=754&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/466199/original/file-20220531-14-9c8cg6.png?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=754&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
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<span class="attribution"><span class="source">Australia Institute, The Wages Crisis Revisited</span>, <a class="license" href="http://creativecommons.org/licenses/by-nd/4.0/">CC BY-ND</a></span>
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<p>The Australian Industry Group and other business representatives blame this on the Fair Work Commission’s strict approach to the “better off overall test” and other statutory protections of employees’ interests in agreement-making.</p>
<p>Unions see it differently. In their view, enterprise bargaining is in free-fall because of design flaws in the current laws, meaning workers have very limited negotiating power and employers can “game” the system to avoid their obligation to bargain.</p>
<p>The main problem: enterprise bargaining was designed for an economy that no longer exists. </p>
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Read more:
<a href="https://theconversation.com/cabinet-papers-1992-93-the-rise-and-fall-of-enterprise-bargaining-agreements-70139">Cabinet papers 1992-93: the rise and fall of enterprise bargaining agreements</a>
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<h2>Workplaces have changed</h2>
<p>Allowing employees and unions to only bargain and take industrial action for an agreement with a single business, or part of a business, works fine with large worksites, such as factories, with hundreds or thousands of workers with the same employer. </p>
<p>But these types of workplaces are increasingly rare. Now, many employers in sectors such as food production, logistics, warehousing, building management and “big box” retail stores have hived off large parts of their operations, and workers, to other entities. </p>
<p>They’ve used labour hire, independent contracting and outsourcing to distance themselves from responsibility for minimum employment standards – and collective bargaining. </p>
<p>To lift wages, workers need the boost to bargaining power that comes from being able to negotiate – and strike – across entire industries. </p>
<p>Labour hire workers must be able to bargain not just with the agency that technically employs them, but with the business for whom they are working – <a href="https://www.theguardian.com/australia-news/2018/jan/20/amazons-labour-hire-deal-and-the-impact-on-collective-bargaining">such as Amazon</a>, which has relied heavily on outsourced labour in its Australian operations.</p>
<p>Workers who clean and provide security services in commercial buildings need to have the capacity to pursue pay increases from the lead firms that ultimately control labour’s share of profits. </p>
<h2>What Labor has promised to do</h2>
<p>Federal Labor’s 2021 <a href="https://alp.org.au/media/2594/2021-alp-national-platform-final-endorsed-platform.pdf">national policy platform</a> contains a commitment to “improve access to collective bargaining, including where appropriate through multi-employer collective bargaining”. </p>
<p>It notes this access is a particular issue for low-paid employees lacking industrial power, and that the Fair Work Act does not adequately facilitate it. </p>
<p>These points, however, were not mentioned in the run-up to the election. Nor did the Australian Council of Trade Unions make an issue of it, in contrast to its “Change the Rules” campaign <a href="https://www.tandfonline.com/doi/abs/10.1080/10301763.2021.2009628">between 2017 and 2019</a>. </p>
<p>Instead, Labor pledged to address other problems in the enterprise bargaining system: the weak requirements for employers to negotiate in “good faith”, and the ease with which employers can have agreements terminated. </p>
<p>However, the Albanese government may well be pushed to “go bolder” – not just by unions but also the Australian Greens, whose <a href="https://greens.org.au/sites/default/files/2022-01/Greens-2022-Policy-Platform--Jobs--Rights.pdf">2022 election policy</a> states: </p>
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<p>Workers should be free to collectively bargain at whatever level they consider appropriate and with whoever has real control over their work, whether at a workplace, industry, sector or other level. </p>
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<p>The Greens’ platform also states: </p>
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<p>Workers should have the right to engage in industrial action, including the right to strike, consistent with international law and not limited to artificially restricted bargaining periods.</p>
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<p>The government may not need Greens’ support to pass legislation in the House of Representatives, but it will need it in the Senate.</p>
<p>So expect the future of enterprise bargaining, along with properly tackling insecure work, to be a hot topic for the government’s planned jobs summit.</p>
<p>With employers already talking up the need for productivity gains to underpin any changes, we’ll have to wait and see how serious the new government is about fixing a broken bargaining system.</p><img src="https://counter.theconversation.com/content/183818/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Anthony Forsyth is affiliated with the Centre for Future Work (Australia Institute) and the Migrant Workers Centre in Victoria. He has received funding from the Australian Research Council Linkage Program (industry partners: Australian Council of Trade Unions & The Union Education Foundation). </span></em></p>Beyond arguing for an increased minimum wage, the new Albanese government needs to fix an outdated system that’s failing our lowest-paid workers – especially women.Anthony Forsyth, Distinguished Professor of Workplace Law, RMIT UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1836432022-05-24T05:51:30Z2022-05-24T05:51:30ZLifting the minimum wage isn’t reckless – it’s what low earners need<figure><img src="https://images.theconversation.com/files/464954/original/file-20220524-21-zxcxnv.png?ixlib=rb-1.1.0&rect=83%2C604%2C2682%2C1562&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">
</span> <span class="attribution"><span class="source">Shutterstock</span></span></figcaption></figure><p>Stand by for something “<a href="https://www.theaustralian.com.au/nation/politics/federal-election-2022-scott-morrison-warns-of-anthony-albanese-economic-vandalism/news-story/1f07e255e278a466dd08a72084f68387">reckless and dangerous</a>”.</p>
<p>That’s what former prime minister Scott Morrison said Prime Minister Anthony Albanese would be if he asked the Fair Work Commission to grant a wage rise big enough to cover inflation. It would make Albanese a “<a href="https://www.abc.net.au/news/2022-05-11/morrison-accuses-albanese-of-being-a-loose-unit-on/13877512">loose unit</a>” on the economy.</p>
<p>Yet Albanese and his industrial relations spokesman Tony Burke are preparing to do just that ahead of the commission’s deadline of June 7, in time for the increase to take effect on July 1.</p>
<p>The increase would amount to a dollar an hour, lifting Australia’s minimum wage from A$20.33 an hour to A$21.36. New Zealand has just lifted its minimum from NZ$20.00 to <a href="https://www.employment.govt.nz/about/news-and-updates/minimum-wage-increasing-on-1-april/">NZ$21.20</a>.</p>
<p>Despite what Morrison and his team said about in the campaign about previous governments <a href="https://www.theguardian.com/australia-news/2022/may/10/election-2022-anthony-albanese-backs-51-minimum-wage-rise-to-keep-pace-with-inflation">avoiding</a> recommending specific recommendations, Morrison’s predecessors Fraser, Hawke and Howard <a href="https://www.afr.com/companies/riddle-of-the-12-pay-grenade-20030313-ka8he">did it for years</a>, and state governments are still doing it.</p>
<p>Back in March, when Australia’s official inflation rate was 3.5%, before it had climbed to 5.1%, Victoria recommended <a href="https://www.fwc.gov.au/documents/wage-reviews/2021-22/submissions/vicgov-sub-awr2122.pdf">3.5%</a>.</p>
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Read more:
<a href="https://theconversation.com/inflation-hits-5-1-how-long-until-mortgage-rates-climb-181832">Inflation hits 5.1%. How long until mortgage rates climb?</a>
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<p>And the government of which Morrison was a part wasn’t shy about telling employers what to pay. </p>
<p>In 2014 its employment minister Eric Abetz counselled “weak-kneed” employers against “caving in” to union demands, setting off a “<a href="https://ministers.dese.gov.au/abetz/industrial-relations-after-thirty-years-war-address-sydney-institute">wages explosion</a>”.</p>
<p>Of course, there’s no guarantee that the Fair Work Commission will heed the new government’s push for a $1 an hour increase. </p>
<p>The commission is perfectly capable of determining what wage rises to grant, after taking into account all submissions. In all but one of the past ten years it has granted <a href="https://www.fwc.gov.au/documents/wage-reviews/2021-22/statisticalreportv5.pdf">more</a> than the prevailing rate of inflation at the time.</p>
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<p>Whether it will do that again remains to be seen next month. But to get ahead of that announcement, here’s how the commission explained its thinking in its most recent decision in <a href="https://www.fwc.gov.au/documents/decisionssigned/html/2021fwcfb3500.htm">June last year</a>.</p>
<h2>Most workers aren’t on awards</h2>
<p>In ruling on a minimum wage increase, what matters most to the commission is employers’ ability to pay (the profits share of national income had <a href="https://theconversation.com/are-real-wages-falling-heres-the-evidence-182171">climbed</a> during five years in which the wages share had shrunk) and the living standards of Australia’s lowest paid. </p>
<p>Only the lowest paid 2% of workers get the national minimum wage, and a further 23% get the minimum award rates the commission adjusts at the same time.</p>
<p>Last year, the commission found some households on the minimum wage had disposable incomes below the poverty line, and it was reluctant to see them fall further. </p>
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Read more:
<a href="https://theconversation.com/are-real-wages-falling-heres-the-evidence-182171">Are real wages falling? Here's the evidence</a>
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<p>It was also reluctant to grant a flat dollar increase that would boost the position of low earners relative to higher earners, saying past flat dollar increases “compressed award relativities and reduced the gains from skill acquisition”.</p>
<p>A percentage rather than a flat increase would particularly benefit women, because, at higher levels, women were “substantially more likely than men to be paid the minimum award rate” and less likely to be paid via contract or an enterprise bargain.</p>
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Read more:
<a href="https://theconversation.com/its-not-just-women-at-the-top-who-are-paid-less-than-men-88474">It's not just women at the top who are paid less than men</a>
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<p>In deciding what percentage increase to award, it gave considerable weight to the most recent increase in the consumer price index (CPI). Right now, that’s <a href="https://theconversation.com/inflation-hits-5-1-how-long-until-mortgage-rates-climb-181832">5.1%</a>.</p>
<p>The Commission dismissed suggestions, put forward <a href="https://www.theaustralian.com.au/commentary/hidden-danger-in-albanese-as-a-wage-setter/news-story/d9ea243d5f6a1a264d9f17257121d989">again</a> in the context of the latest 5.1% increase in the CPI, that it should use the separately calculated “<a href="https://www.abs.gov.au/statistics/economy/price-indexes-and-inflation/selected-living-cost-indexes-australia/latest-release">employee living cost</a>” index, which has come in at 3.8%.</p>
<p>The employee living cost index has been climbing by less than the CPI because it includes mortgage rates, which have been falling, whereas the CPI does not.</p>
<h2>Low earners aren’t mortgagees</h2>
<p>The commission made the point that low-paid workers were less likely to own a home than higher-paid workers, making the CPI a better measure for them.</p>
<p>But not a perfect measure. The Australian Bureau of Statistics has begun dividing the CPI into “<a href="https://theconversation.com/why-the-rba-should-go-easy-on-interest-rate-hikes-inflation-may-already-be-retreating-and-going-too-hard-risks-a-recession-182273">discretionary</a>” (non-essential) purchases and other, essential, purchases.</p>
<p>The commission says low income households spend more of their income on essentials than higher earning households, making “<a href="https://www.abs.gov.au/articles/measuring-non-discretionary-and-discretionary-inflation">non-discretionary</a>” inflation especially relevant. Non-discretionary inflation is running at 6.6%.</p>
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<p>The commission rejected suggestions the increase it proposed could push Australians out of work or make it harder for young Australians to find work.</p>
<p>Which isn’t to say that couldn’t happen. During the 1970s and 1980s high wage growth fed both high inflation and high unemployment, so-called <a href="https://www.investopedia.com/terms/s/stagflation.asp">stagflation</a>.</p>
<h2>Wages aren’t destroying jobs</h2>
<p>But back in the 1970s and 1980s, wages were climbing faster than the combination of price growth and productivity growth, making increases hard for employers to pay. Of late, the profits share of national income has been <a href="https://theconversation.com/are-real-wages-falling-heres-the-evidence-182171">climbing rather than falling</a>, giving employers an increasing ability to pay.</p>
<p>And whereas back then most workers were paid via the awards set by the commission, today most are paid via enterprise agreements negotiated firm by firm, meaning increases in awards only flow through to workers on agreements to the extent that they and employers are able to agree on them.</p>
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Read more:
<a href="https://theconversation.com/real-wages-are-shrinking-these-figures-put-it-beyond-doubt-183343">Real wages are shrinking, these figures put it beyond doubt</a>
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<p>And what the government is proposing is not an increase markedly greater than inflation, of the kind that fed stagflation though the 1970s and early 1980s, but an increase in line with prices – even though employers might be able to pay more.</p>
<p>If what the government is proposing strikes the commission as reckless or dangerous, it will reject it. The increases it has granted to date have added to neither unemployment nor (particularly) to overall wages growth.</p>
<h2>Low earners versus homeowners</h2>
<p>The commission will certainly reject any suggestion that it ignore the next increase in compulsory superannuation contributions, due to lift employers’ contributions from 10% of salary to 10.5% in July. </p>
<p>The contributions are a cost to employers and a benefit to employees. It has taken them into account in the past.</p>
<p>And it should reject, as repugnant, Morrison’s suggestion that it should clamp down on wage rises for Australia’s least paid, so homeowners can continue to enjoy historically unprecedented <a href="https://www.abc.net.au/news/2022-05-11/morrison-hits-back-on-labor-inflation-pay-rise-push/101055134">low mortgage rates</a>.</p>
<p>Homeowners, almost all of them, are much better off than Australia’s least paid.</p><img src="https://counter.theconversation.com/content/183643/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Peter Martin does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Low-wage earners are going backwards. Here’s why they deserve an increase in the minimum wage by $1 an hour from July 1.Peter Martin, Visiting Fellow, Crawford School of Public Policy, Australian National UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1835272022-05-24T02:38:20Z2022-05-24T02:38:20ZWages and women top Albanese’s IR agenda: the big question is how Labor keeps its promises<p>Industrial relations issues were front and centre when federal Labor last won office from opposition in 2007. The backlash against John Howard’s “Work Choices” reforms cost both his government and his own seat. Kevin Rudd and Julia Gillard’s detailed “Forward with Fairness” policy provided a blueprint for the Fair Work Act that is still in force today.</p>
<p>Workplace issues were nothing like as prominent in the 2022 election. Still, Labor campaigned on the need to address three key issues: wage stagnation, insecure jobs, and gender inequality. </p>
<p>Lifting wages will be a priority for the Albanese government, to help ease the cost of living. But it may also be pressured by both unions and the Greens to go further in addressing problems with the “Fair Work” system.</p>
<h2>Tackling the wages crisis</h2>
<p>There are many reasons for Australia’s low wage growth over the past decade, not least a <a href="https://theconversation.com/despite-record-vacancies-australians-shouldnt-expect-big-pay-rises-soon-180416">loss of bargaining power for workers</a>. Clearly though the problem is not going to fix itself. Policy action <a href="https://www.futurework.org.au/wages_crisis_will_continue_without_active_wage_boosting_policies_report">is needed</a>. The question is whether Albanese and his colleagues have the answers.</p>
<p>In the first instance, they will look for help from the Fair Work Commission in its upcoming annual wage review. Albanese has <a href="https://www.theguardian.com/australia-news/2022/may/12/anthony-albanese-narrows-scope-of-pledge-to-support-51-pay-rise-to-match-inflation">expressed support</a> for a minimum wage increase that at least keeps pace with inflation. That could potentially benefit everyone in the workforce whose pay is set by, or linked to, an award. </p>
<p>Beyond that, there are plans to <a href="https://www.alp.org.au/policies/closing-the-gender-pay-gap">improve pay equity for women</a>. Proposed reforms include requiring large employers to report their gender pay gap publicly, prohibiting pay secrecy clauses, and broadening the Fair Work Commission’s power to redress the undervaluation of work in female-dominated industries.</p>
<p>Labor has also undertaken to improve the enforcement of minimum wage laws. It has committed to introducing criminal penalties for “wage theft” – something the Morrison government <a href="https://www.abc.net.au/news/2021-03-18/industrial-relations-changes-pass-parliament-casual-work/13259566">promised but failed to do</a> – and ensure workers have a “<a href="https://www.tonyburke.com.au/speechestranscripts/2021/11/15/speech-address-to-the-australian-labour-law-association">quick and easy way</a>” to recover underpayments.</p>
<p>What is less clear is whether the Albanese government can bring itself to set a lead for the private sector, both by paying public servants more and by supporting decent wage growth in the many sectors affected by public funding and procurement. </p>
<p>Doing so could have a rich economic and social dividend. But the cost will be a challenge, especially with Labor <a href="https://www.alp.org.au/policies/aged-care">already committed</a> to supporting and funding significant pay increases for aged-care workers.</p>
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Read more:
<a href="https://theconversation.com/real-wages-are-shrinking-these-figures-put-it-beyond-doubt-183343">Real wages are shrinking, these figures put it beyond doubt</a>
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<h2>Enterprise bargaining</h2>
<p>Then there is the <a href="https://www.afr.com/work-and-careers/workplace/pandemic-worsens-decline-in-enterprise-bargaining-20210920-p58t4f">decline of enterprise bargaining</a>, the process supposed to be the main way of gaining wage rises under the Fair Work system. Just 11% of private-sector employees are now covered by a current (non-expired) enterprise agreement.</p>
<p>Albanese has spoken of a <a href="https://www.smh.com.au/politics/federal/spirit-of-consensus-albanese-holds-out-promise-of-economic-reform-to-lift-wages-20220505-p5aixx.html">business-union summit</a> – echoing the “consensus” approach taken by the Hawke Labor government in the 1980s – to discuss how to revitalise the bargaining system. </p>
<p>It could certainly be simplified, and much could be gained from a <a href="https://www.afr.com/work-and-careers/workplace/the-cure-for-workplace-strife-20191203-p53gbb">new emphasis on co-operation</a>. Yet much as the new prime minister would like to channel Bob Hawke and rediscover the virtues of <a href="https://dictionary.cambridge.org/dictionary/english/tripartite">tripartism</a> – with employer organisations, trade unions and governments working together – it will take a herculean effort to find consensus.</p>
<p>Many in the labour movement would like to see a reversion to industry-level bargaining, at least in sectors where enterprise negotiations are impractical, as well as a greater role for the tribunal in breaking deadlocks. It will be fascinating to see if <a href="https://australiainstitute.org.au/post/as-collective-bargaining-erodes-in-australia-solutions-from-other-countries-could-strengthen-bargaining-and-lift-wages/">those ideas</a> gain any traction over the next three years.</p>
<h2>Making work less precarious</h2>
<p>In contrast to its silence on bargaining and the role of trade unions, Labor has <a href="https://www.alp.org.au/policies/secure-australian-jobs-plan">clear plans</a> to address insecure forms of work. Among other things, it has promised to:</p>
<ul>
<li><p>limit casual and fixed-term employment to jobs that are genuinely temporary or irregular</p></li>
<li><p>ensure labour-hire workers are paid the same as those directly employed by the business to which they are assigned, and</p></li>
<li><p>empower the Fair Work Commission to set minimum wages and conditions for “employee-like” workers, including those finding work through digital labour platforms such as Uber or Deliveroo.</p></li>
</ul>
<p>The complexity of many of these issues should not be underestimated. There are many long-term casuals, for example, who prefer to take a pay loading in lieu of leave entitlements they may never use.</p>
<p>Allowing the Fair Work Commission to make an award for certain types of gig worker will not fully address the potential for “sham contracting” arrangements <a href="https://www.afr.com/work-and-careers/workplace/later-high-court-backs-freedom-to-contract-in-major-ruling-20220209-p59uyi">opened up by recent High Court decisions</a>. </p>
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Read more:
<a href="https://theconversation.com/the-truth-about-much-casual-work-its-really-about-permanent-insecurity-151687">The truth about much 'casual' work: it's really about permanent insecurity</a>
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<p>It will be interesting to see if the new government moves on these reforms immediately, or perhaps looks for some of them to be explored in greater depth by its promised <a href="https://anthonyalbanese.com.au/media-centre/a-new-labor-playbook-for-national-productivity-reforms-acci">white paper</a> on the labour market.</p>
<h2>A focus on women at work</h2>
<p>Post-election analysis has rightly focused on the <a href="https://theconversation.com/women-stormed-the-2022-election-in-numbers-too-big-to-ignore-what-has-labor-pledged-on-gender-183369">crucial role played by female voters and candidates</a>. The new government will be doubly keen to implement the parts of its platform that address issues of particular significance to women. </p>
<p>Besides the policies already mentioned on pay equity and insecure work, there is a <a href="https://www.alp.org.au/policies/cheaper-child-care">pledge of cheaper childcare</a>, plus a new right to paid family and domestic violence leave. </p>
<p>Labor will also fully implement recommendations from the Australian Human Rights Commission’s <a href="https://humanrights.gov.au/our-work/sex-discrimination/publications/respectwork-sexual-harassment-national-inquiry-report-2020">Respect@Work report</a> on sexual harassment. That includes amending the Sex Discrimination Act to create a <a href="https://theconversation.com/explainer-what-is-a-positive-duty-to-prevent-workplace-sexual-harassment-and-why-is-it-so-important-167430">positive duty on employers</a> to take reasonable measures to eliminate sexual harassment.</p>
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Read more:
<a href="https://theconversation.com/explainer-what-is-a-positive-duty-to-prevent-workplace-sexual-harassment-and-why-is-it-so-important-167430">Explainer: what is a 'positive duty' to prevent workplace sexual harassment and why is it so important?</a>
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<p>Possibly the greatest challenge, however, will be to make a difference in the workplace over which the government has most control – parliament house. Staffers and MPs are entitled to expect not just protection from violence and harassment but <a href="https://theconversation.com/the-jenkins-review-has-28-recommendations-to-fix-parliaments-toxic-culture-will-our-leaders-listen-172858">greater respect and accommodation</a>.</p>
<p>It will be a very public forum in which to judge the new government’s commitment to fair pay and conditions for working women.</p><img src="https://counter.theconversation.com/content/183527/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Andrew Stewart does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Lifting wages will be a priority for the Albanese government to ease the cost of living. But the unions and the Greens are likely to push for more changes to tackle problems with the Fair Work system.Andrew Stewart, John Bray Professor of Law, University of AdelaideLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1833432022-05-18T09:34:02Z2022-05-18T09:34:02ZReal wages are shrinking, these figures put it beyond doubt<figure><img src="https://images.theconversation.com/files/463854/original/file-20220518-26-sbqv4y.png?ixlib=rb-1.1.0&rect=940%2C736%2C3041%2C1455&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">
</span> <span class="attribution"><span class="source">Shutterstock/The Conversation</span></span></figcaption></figure><p>Every three months the Bureau of Statistics releases the lesser-known cousin of the consumer price index. It’s called the <a href="https://www.abs.gov.au/statistics/economy/price-indexes-and-inflation/wage-price-index-australia/mar-2022">Wage Price Index</a> (WPI) and it records changes in the overall level of wages, in the same way the price index records changes in the overall level of consumer prices.</p>
<p>Rarely does it generate headlines, but coming three days before an election and showing the worst performance ever compared with the consumer price index, it has provided concrete evidence that the buying power of wages is shrinking.</p>
<p>Contrary to hopes that lower unemployment would spark <a href="https://www.rba.gov.au/media-releases/2022/mr-22-12.html">higher wages growth</a>, the WPI barely budged in the year to March: climbing 2.4%, up from 2.3% in the year to December.</p>
<p>The consumer price index for the year to March grew twice as fast, by 5.1%</p>
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<p>It means <a href="https://www.indeed.com/career-advice/career-development/nominal-wage-vs-real-wage">real wages</a> (the buying power of wages) shrank 2.7% over the year to March in aggregate - one of the fastest and steepest declines ever.</p>
<p>Since March, during the election campaign, <a href="https://theconversation.com/rba-governor-philip-lowe-is-hiking-interest-rates-worst-case-itll-mean-an-extra-600-per-month-on-a-500-000-mortgage-182241">interest rates have been pushed up</a>, further adding to the cost of living.</p>
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Read more:
<a href="https://theconversation.com/are-real-wages-falling-heres-the-evidence-182171">Are real wages falling? Here's the evidence</a>
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<p>Coming right at the end of the campaign, the news reinforces a traditional Labor concern (living costs) and diminishes a traditional Coalition selling point (superior economic management).</p>
<p>And it’s a full frontal challenge to conventional economics. </p>
<p>Here are just three of the conventional thoughts it has thrown into doubt.</p>
<h2>Wages are determined by supply and demand</h2>
<p>Conventional economics treats the price of labour like the price of any other commodity (such as fruit at a market), determined by supply (if there’s too much the price will fall) and demand (if a lot of people want it the price will rise).</p>
<p>That is held to mean that, even if there is still some unemployment, wages will grow faster if employers find it hard to find workers (as they are now) and slower if workers find it hard to find jobs (as was the case when unemployment was higher).</p>
<p>There is said to be a special unemployment rate – the Non-Accelerating Inflation Rate of Unemployment, NAIRU – below which wages will start to grow quickly, entrenching accelerating inflation.</p>
<p>The problem is that the NAIRU can’t easily be observed, and moves around. </p>
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Read more:
<a href="https://theconversation.com/despite-record-vacancies-australians-shouldnt-expect-big-pay-rises-soon-180416">Despite record vacancies, Australians shouldn't expect big pay rises soon</a>
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<p>The Treasury and Reserve Bank once believed NAIRU was close to 7%, then 6%, then <a href="https://treasury.gov.au/publication/p2021-164397">5%</a> or lower. Now they are
<a href="https://d3n8a8pro7vhmx.cloudfront.net/theausinstitute/pages/3111/attachments/original/1573673492/Tolerate_Unemployment_but_Blame_the_Unemployed_Formatted.pdf?1573673492">not sure it exists</a>.</p>
<p>With unemployment well below the rates they once believed would push up the growth rate, there is growing doubt about whether it can.</p>
<p>Part of the reason is that unlike the market for fruit (or pork bellies or flat whites), institutions and bargaining power affect what happens to wages in addition to supply and demand. De-unionisation, insecure work, and deregulation of the wage-setting process have shifted the balance of power away from workers.</p>
<h2>Labour markets are flexible</h2>
<p>Decades of changes to Australia’s wage-setting system were sold as allowing labour markets to respond more smoothly to changes in supply and demand, ensuring workers were more closely paid in accordance with what they produced (productivity).</p>
<p>But a lot of (anti-worker) rigidity remains. One source is punitive public sector pay caps, which even the <a href="https://parlinfo.aph.gov.au/parlInfo/search/display/display.w3p;query=Id%3A%22committees%2Fcommrep%2Feea5d0b8-72e9-4b5e-acf8-52ed46888ced%2F0001%22;src1=sm1">Reserve Bank</a> says are contributing to weak wage growth.</p>
<p>Another is <a href="https://www.fwc.gov.au/greenfields-agreement">greenfield enterprise agreements</a>, which lock in predetermined pay rates for years.</p>
<h2>Inflation originates in the labour market</h2>
<p>Anthony Albanese sparked an <a href="https://www.smh.com.au/politics/federal/albanese-sparks-political-storm-by-backing-wage-rise-to-match-inflation-20220510-p5ak48.html">important debate</a> when he said wages should at least keep up with inflation. </p>
<p>Scott Morrison said this would be like “<a href="https://www.abc.net.au/news/2022-05-11/morrison-hits-back-on-labor-inflation-pay-rise-push/101055134">throwing throwing fuel on the fire</a>” of inflation. But Wednesday’s figures seem to indicate that inflation has a life of its own. It is soaring while wages growth is not.</p>
<p>And after adjusting for productivity growth (which has been surprisingly resilient, averaging 2% per year for the past two years), unit labour costs have grown the slowest in years, by just 1.5% per year since 2019. </p>
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<p>Whatever is causing inflation, it isn’t firms passing on higher wage costs to their customers. Some are passing on higher profit margins. If anything, what we are experiencing is more like profit-price inflation than wage-price inflation.</p>
<p>During the COVID crisis, profits climbed to a record high as a share of GDP while labour compensation (mainly wages) fell to its <a href="https://assets.nationbuilder.com/theausinstitute/pages/4033/attachments/original/1652197383/Wages_Crisis_Revisited_Formatted.pdf?1652197383">lowest point in postwar history</a>.</p>
<p>While economic truisms are being reassessed, voters are in the process of coming to grips with what stubbornly low wages growth means for them. Many more of them make their living by selling their labour than by taking profits.</p><img src="https://counter.theconversation.com/content/183343/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Jim Stanford is a member of the Australian Services Union</span></em></p>The buying power of wages shrank a record 2.7% over the year to March, calling into question assurances about the link between low unemployment and high wage growth.Jim Stanford, Economist and Director, Centre for Future Work, Australia Institute; Honorary Professor of Political Economy, University of SydneyLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1804192022-03-31T08:34:14Z2022-03-31T08:34:14ZAnthony Albanese offers $2.5 billion plan to ‘fix crisis in aged care’<p>Opposition leader Anthony Albanese has made comprehensive reform of aged care the centrepiece of his budget reply delivered on Thursday night. </p>
<p>His “plan to fix the crisis in aged care” is costed at $2.5 billion over four years. But this doesn’t include the cost of a wage increase for workers, which a Labor government would urge and fund. </p>
<p>Labor’s five point plan promises registered nurses on site 24/7, more carers, a pay rise for the sector’s workers, standards to ensure better food for residents, and greater accountability imposed on providers.</p>
<p>“Labor will deliver new funding, more staff and better support to the aged care sector,” Albanese said. </p>
<p>Attacking Tuesday’s budget, the opposition leader said Australians knew the difference between reforms that improved people’s lives and “cynical one off payments designed for an election.</p>
<p>"This government might as well have stapled cash to your ballot paper,” he said. </p>
<p>Nevertheless Labor would “deliver those payments as well, because we know the pressure Australians are under.</p>
<p>"But if you vote Labor in May our work on cost of living won’t stop when the votes are counted.”</p>
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Read more:
<a href="https://theconversation.com/labors-budget-reply-goes-big-on-aged-care-similar-on-much-else-180098">Labor's budget reply goes big on aged care, similar on much else</a>
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<p>“The truth is if you want real, permanent, meaningful help with the cost of living, you need a plan to get wages growing again. And you need a Labor government to do it.”</p>
<p>Albanese said the budget was “as it always is with this prime minister, long on politics, short on plans. All announcement, no delivery. Far too little, way too late”.</p>
<p>This was a government that left Australians behind. “If you vote Labor in May, I can promise you this will change.</p>
<p>"If I’m prime minister, I won’t go missing when the going gets tough - or pose for photos and then disappear when there’s a job to be done. </p>
<p>"I’ll show up, I’ll step up - and I’ll work everyday to bring our country together.”</p>
<p>Albanese said the Coalition was asking voters “to trust them that somehow they’ll be better in their fourth term.</p>
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Read more:
<a href="https://theconversation.com/budget-gives-49-5-million-for-aged-care-training-but-what-about-wages-180133">Budget gives $49.5 million for aged care training, but what about wages?</a>
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<p>"After all the waste and rorts and scandals, can you imagine how arrogant and dismissive they will be if they enter a second, long decade in office?” </p>
<p>Much of the Labor aged care plan involves tougher regulation of the sector, including giving the Aged Care Safety Commissioner new powers. </p>
<p>Aged care has been a hot button issue in the community with the royal commission, which gave its final report in 2020, finding the sector in need of drastic overhaul. </p>
<p>In the wake of Tuesday’s budget, aged care peak bodies have criticised the government’s lack of action to get improved wages for workers. The government has declined to intervene in the wage case to back a pay increase for workers.</p>
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Read more:
<a href="https://theconversation.com/view-from-the-hill-if-money-talks-the-government-has-megaphone-out-180121">View from The Hill: if money talks, the government has megaphone out</a>
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<p>Albanese said Labor would require every aged care facility to have a registered, qualified nurse present around the clock each day. “This will save thousands of stressful, expensive and ultimately unnecessary trips to hospital emergency departments, for issues a nurse could solve on the spot,” he said.</p>
<p>Labor would mandate that everyone living in residential facilities received at least 215 minutes of care everyday, as the royal commission recommended.</p>
<p>“So, if you have a loved one in aged care, you can be certain they will get more time with a registered nurse and more time with enrolled nurses and personal care workers,” he said. </p>
<p>Albanese reiterated a Labor government would support a pay rise for workers before the Fair Work Commission, and fund the outcome of the case. But once again, he did not indicate any amounts Labor believes is appropriate. </p>
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Read more:
<a href="https://theconversation.com/todays-aged-care-falls-well-short-of-how-wed-like-to-be-treated-but-there-is-another-way-177067">Today's aged care falls well short of how we'd like to be treated – but there is another way</a>
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<p>“We know if we want to recruit and obtain more carers to look after a population that’s growing older we need to treat their vital and essential workforce with respect and reward it with better pay.” </p>
<p>A Labor government would implement mandatory nutrition standards in aged care homes. It would also improve integrity and accountability, making providers give detailed public reports about what they were spending money on. </p>
<p>“Older Australians fear that the final chapter of their life will be an aged care facility where they are not properly cared for, let alone afforded real dignity,” Albanese said. </p>
<p>“Their children wrestle with the dilemma of sending them to a place that might not be good enough, versus the risk of leaving them at home when it’s becoming unsafe to be on their own.” </p>
<p>Albanese said if the Liberals were reelected “nothing will change - and the bleak present they have created will be the bleak future awaiting so many Australians”. </p>
<p>“If we want to change aged care in this country for the better, then we need to start by changing the government.”</p><img src="https://counter.theconversation.com/content/180419/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Michelle Grattan does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Opposition leader Anthony Albanese has made comprehensive reform of aged care the centrepiece of his budget reply delivered on Thursday night.Michelle Grattan, Professorial Fellow, University of CanberraLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1730592021-12-27T19:02:37Z2021-12-27T19:02:37ZRemembering Geoffrey Giudice, the ‘bosses man’ who helped make Australia’s Fair Work Commission fair<p>In the turbulent world of industrial relations, Geoff Giudice was an oasis of calm.</p>
<p>An employers’ barrister and earlier a union researcher, the 13th president of Australia’s national workplace tribunal, now called the Fair Work Commission, had a knack for putting people at ease.</p>
<p>“He brought to his professional life a mixture of humility, sophisticated intelligence, integrity, personal likeability, a preparedness to work, and a suppleness of thinking that enabled him to adjust to change,” said lawyer Michael Tehan at his <a href="https://tobinbrothers.com.au/tribute/details/22533/Hon-Geoffrey-Michael-Giudice-AO/obituary.html#tribute-start">funeral</a> in November.</p>
<p>And there was a lot of change. The newly-elected Howard Coalition Government appointed Giudice a judge and president of the Australian Industrial Relations Commission in 1997 within months of introducing its Workplace Relations Act.</p>
<p>The new law severely restricted the commission’s powers to resolve disputes and set wages and conditions and instead sought to encourage employers and employees to settle their differences at the workplace.</p>
<p>Further rounds of change followed - both by the Coalition Government
in its unpopular WorkChoices legislation and the Rudd Labor Government which reconstituted the tribunal as Fair Work Australia.</p>
<p>Calls for more change continue today.</p>
<h2>Independent and impartial</h2>
<p>In an oral history interview I conducted with him for the <a href="https://www.fwc.gov.au/sir-richard-kirby-archives/exhibitions/treasures-the-archives/5-oral-history-program">Sir Richard Kirby Archives</a> in 2012 Giudice outlined his approach to leading the tribunal through contentious times. It was based on professionalism, integrity and setting an example.</p>
<p>“I didn’t want it ever to be said that while I was president of the commission there was any suggestion of corruption in the way decisions were made and that everybody would get a fair go based on the submissions they made,” he said.</p>
<p>Giudice regarded independence as not only being seen to be impartial by those who appeared before the commission, but also in dealings with government.</p>
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Read more:
<a href="https://theconversation.com/the-enduring-myth-of-the-industrial-relations-club-34647">The enduring myth of the industrial relations club</a>
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<p>He strongly believed there was great danger for tribunal members in expressing views on government policy. To do so could “undermine confidence in the tribunal’s decisions” and lead to a perception of the tribunal pursuing an agenda rather than applying the law.</p>
<p>At the time of his appointment in 1997 some in the union movement were angry and suspicious given his earlier representation of high-profile business clients including Ansett and mining giant Rio Tinto.</p>
<p>When he retired in 2021, however, the Australian Council of Trade Unions praised his achievements, even describing him as a “<a href="https://www.fwc.gov.au/documents/documents/transcripts/240212ceremonialvic.htm">good boss</a>”. </p>
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<figcaption><span class="caption">Sir Richard Kirby Archive Oral History Program, treasures of the archives.</span></figcaption>
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<p>The commission was established as the Commonwealth Court of Conciliation and Arbitration in 1904 shortly after Federation and the great strikes of the 1890s. </p>
<p>Legislation aimed at abolishing it and returning its powers to the states in 1929 led to the defeat of the Bruce-Page Coalition government.</p>
<p>When the Howard government introduced WorkChoices in 2005 (which also contributed to its defeat), Giudice rolled out a series of briefings for unions and employers as well as some media in which, while not straying into discussion of government policy, he made it clear the commission had a continuing role.</p>
<h2>Appointed by both sides</h2>
<p>When the Rudd Labor government replaced the commission with Fair Work Australia in 2009, Rudd’s industrial relations minister Julia Gillard appointed Giudice inaugural president, saying he would deliver a “fair go”.</p>
<figure class="align-right ">
<img alt="" src="https://images.theconversation.com/files/436851/original/file-20211210-23-1e5dj1j.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=237&fit=clip" srcset="https://images.theconversation.com/files/436851/original/file-20211210-23-1e5dj1j.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=970&fit=crop&dpr=1 600w, https://images.theconversation.com/files/436851/original/file-20211210-23-1e5dj1j.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=970&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/436851/original/file-20211210-23-1e5dj1j.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=970&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/436851/original/file-20211210-23-1e5dj1j.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=1218&fit=crop&dpr=1 754w, https://images.theconversation.com/files/436851/original/file-20211210-23-1e5dj1j.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=1218&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/436851/original/file-20211210-23-1e5dj1j.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=1218&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
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<span class="caption">Geoffrey Guidice, appointed by both sides.</span>
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<p>Born in Bendigo in 1947, Giudice accidentally fell into a career in industrial relations in 1970 by taking up a vacation job with the Hospital Employees’ Federation. </p>
<p>While he went on to represent mostly employers as a barrister, which is usual in labour law, he said the union experience gave him a “good idea of the difficulties faced by people who are on low incomes”.</p>
<p>Following his death on November 18 2021, friends and colleagues described him as intelligent, kind, thoughtful, humble, witty and even chivalrous. </p>
<p>Known for his signature bow tie and love of the Melbourne Football Club, it was revealed that in his final days he got to hold the premiership cup after Melbourne’s long-awaited win.</p>
<p>A staunch Catholic, his post-retirement positions included professorial fellow with The University of Melbourne, chair of Catholic Professional Standards Ltd and chair of the AFL Tribunal and AFL Appeal Tribunal.</p>
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Read more:
<a href="https://theconversation.com/we-should-simplify-industrial-relations-but-not-in-the-way-business-wants-137607">We should simplify industrial relations, but not in the way business wants</a>
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<p>He was famously media-shy, refusing nearly all interview requests. But as the commission’s first media adviser – a role he created – I know he supported the work of journalists in communicating the work of the tribunal to the public.</p>
<p>For those who assume a previous professional background will predict the behaviour of an appointee to public office, his life is an invitation to think again.</p><img src="https://counter.theconversation.com/content/173059/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Judy Hughes worked for the Australian Industrial Relations Commission and Fair Work Australia in media and communications from 1999 to 2012. She was the first media officer to be appointed to the tribunal in its century-long history and her role was created by then president Justice Giudice.</span></em></p>For anyone who assumes someone’s professional past will predict their future behaviour, Geoffrey Giudice’s life of public service is an invitation to think again.Judy Hughes, PhD candidate in History, La Trobe UniversityLicensed as Creative Commons – attribution, no derivatives.