Bill Shorten’s plan to fast track a lift to the minimum wage


A spokeswoman said the plan would be contingent on the commission agreeing to consider the new submission in time for a wage hike to be implemented on July 1. Without such an intervention, a Shorten government would have to wait until next year’s review to deliver on its promise to lift the minimum wage.

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While consultations for the current review are due to finish on May 15 – three days before the election – University of Adelaide workplace law professor Andrew Stewart said he expected the commission would agree to examine an additional submission from an incoming government.

If elected, Mr Shorten will ask the commission to accept a beefed-up version of its Opposition submission lodged in March, drafted with the full authority and resources of a federal government.

Labor would also legislate to enable the commission to set a long-term “living wage” target, but is unlikely to achieve this before its 2019 wage ruling is handed down in June.

Professor Stewart said the commission could order an above-inflation minimum wage increase under the current rules, which require it to consider both “the performance and competitiveness of the national economy” and the living standards of low-paid workers.

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This would reflect the commission’s decisions in recent years, having increased the minimum wage by 3.5 per cent last year – ahead of the then inflation rate of 2.1 per cent – and 3.3 per cent in 2017.

The Morrison government used its submission to the current review to argue that Australia already has a “living wage”, pointing out that it is among the highest in the OECD.

Employers are demanding that Labor resist taking action on its industrial relations reform agenda without extensive consultation with the business community, as a new report argues that forcing wages up could cost jobs.

KPMG Australia chief economist Brendan Rynne studied wage rises between 1995 and 2018 and found that industries that had fallen behind on their investment in technology were the most likely to be have workers battling low wage growth.

Financial, professional, scientific and technical services and manufacturing have seen higher wage growth, while accommodation and food services and administration services had the lowest.

“Our report shows the growing influence of high-tech capital as a determining factor in improving productivity and wage growth,” he said.

Dr Rynne said wages were unlikely to see the “once-in-a-generation free kick” they got during the mining boom again and that government support for productivity through technology was key.

Labor will also unveil the next stage of its reforms to the skilled visa system on Tuesday, lifting the minimum salary a migrant can be paid by 20 per cent to $65,000 a year in a move it says will stop firms under-cutting Australian workers.

“When businesses use overseas workers as a cheap replacement for local workers it contributes to wage stagnation,” Mr Shorten said.

Dana is health and industrial relations reporter for The Sydney Morning Herald and The Age.

Eryk Bagshaw is an economics correspondent for The Sydney Morning Herald and The Age.

Shane is a senior economics correspondent for The Age and The Sydney Morning Herald.

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