“Another year, another hike in the minimum wage,” said Aaron Lane, legal fellow at the free market think tank the Institute of Public Affairs.
“Minimum wage decisions are becoming all too predictable. Every year the employer organisations, such as the Australian Chamber of Commerce and Industry, make a low-ball offer – this year, an increase of $8.10 per week. Every year the trade unions, represented by the Australian Council of Trade Unions, make a high-ball offer – this year, an increase of $45.00 per week. And every year the Fair Work Commission decides to increase the minimum wage roughly in the middle of those submissions. Today’s decision is no exception,” said Mr Lane.
Today the Fair Work Commission handed down its decision for the 2016-2017 Annual Wage Review. The Commission decided to increase the minimum wage by 3.3 percent to $694.90 per week – an increase of $22.20. On an hourly basis, this will increase the minimum wage from $17.70 per hour to $18.29 per hour. IPA analysis below shows the history of the Fair Work Commission’s annual wage decisions, matched with the submissions from ACCI and the ACTU.
“The minimum wage is only a safety net for those people that already have a job. Successive increases in the minimum wage provide no comfort to unemployed or discouraged workers, who will now find it harder to get a job thanks to slower employment growth, or low-paid workers who face the prospect of having their hours cut.”
“It is curious that the Fair Work Commission accepted that prohibitive penalty rates discouraged weekend work – but the same laws of economics don’t apply to the minimum wage.”
“There is dignity in work. A fairer system would recognise that the value of work transcends an hourly rate. Work provides an opportunity to create value, build skills and enjoy earned success. Individual employees and employers should be free to come to an agreement on the arrangements that best suit them,” said Mr Lane.
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