Millions of Aussies are set to get a pay rise within the next few weeks after the Fair Work Commission approved an increase to the minimum wage.
In line with the changes, minimum award workers across the country will get a pay boost of 4.75 per cent, an increase that affects around 21 per cent of the Aussie workforce, or about 2.8 million people.
The new national minimum wage will now be $26.44 per hour, an increase from $24.95, and $1,004.90 per week (up from $948), based on a full-time 38-hour week.
All up, the increase takes Australia’s minimum annual wage to more $50,000 for the first time.
The changes come into effect from July 1, and are the result of submissions given to the Fair Work Commission — the country’s top independent workplace tribunal — from government, business groups and unions, which help it make its own wage determination.
Australian Prime Minister Anthony Albanese previously backed an above-inflation minimum wage increase but didn’t commit to a specific number.
Speaking of the changes, the Commission’s president, Adam Hatcher, said the determination was “particularly challenging” this time around due to “wild card” economic factors like the outbreak of war in the Middle East, which disrupted fuel supplies and accelerated inflation pressures.
As a result, Hatcher said the minimum wage increase “regrettably” won’t fully recoup wages that have fallen short of cost-of-living and inflation pressures over the past few years.
“We have concluded regrettably that it would not be practicable or responsible to award a real wage increase for employees that would be sufficient to close the real wage gap entirely,” Hatcher said.
The Commission said it also accounted for other factors when making its determination, like achieving income equality and the competitiveness of the national economy.
Other groups which gave submissions for the wage review, like unions, had called for a six per cent minimum wage hike, which would’ve marked the biggest increase on record. Sally McManus, the secretary of The Australian Council of Trade Unions, argued the figure would help Australia’s lowest-paid workers meet living demands and prepare if economic conditions deteriorate.
For its part, the country’s employers body, Australian Industry Group, labelled the six per cent rise “ludicrous” and called for just a 3.9 per cent wage increase.
Speaking ahead of the Commission’s announcement, Treasurer Jim Chalmers said the government’s position is “very, very” clear.
“Workers on the minimum wage and on awards need and deserve a decent sustainable real wage increase,” he said.
This story is developing.
Lead images: Getty
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