AiGroup calls for zero wage increase

Peak employer group Ai Group has called for a zero increase in wages in its submission to the Fair Work Commission’s annual wage review.

Their submission said: “The economy is in no position to sustain an increase in minimum wage rates.”

Should the commission decide on an increase, AiG wants it to apply no earlier that January 1, 2021.

The group, which is leading manufacturer representations in wider efforts by the federal government to reform industrial relations laws, bases its recommendation on its analysis of the economy and business conditions in the light of the Covid-19 pandemic.

The economy contracted during the March quarter by 0.3 per cent with RBA and Treasury expecting an eight per cent DGP fall in the second quarter.

Private expenditure by households, investment in houses and business investment are all falling.

During the March quarter new engineering construction fell 6.3 per cent and investment in machinery and equipment fell 3.3 per cent.

However intellectual property investment rose 6.2 per cent.

On the production side industry output volumes shrank in 11 of Australia’s 19 major industry groups.

However manufacturing output rose 2.6 per cent.

Ai Group noted the federal government’s injection of financial support for low-income households through the $1,500 per fortnight JobKeeper scheme.

“…This additional income support for low-wage employees is highly pertinent to the panel’s considerations relating to the needs of the low paid and there (sic) relative living standards with the case for raising wages diminished by the quantum of non-wage income support being paid to low income households.”

However Ai Group argued against awarding a different level of increase to to businesses that are, or are not eligible for JobKeeper, or businesses in different sectors.

This is despite JobKeeper including exceptions where many casual employees, employees of large companies and public servants are not eligible to receive payments under the scheme.

Ai Group’s wage submission follows the release of its wish list for industrial relations reform:

Ai Group’s Innex Willox said: “It is time for a fresh approach to be taken on industrial relations reform, an approach that boosts productivity, grows jobs, encourages investment and restores economic growth,” the chief executive of the organisation.”

The federal government has set up industrial relations reform working groups in the areas of award simplification, enterprise agreement making, casuals and fixed-term employees, compliance and enforcement and greenfields agreements for new enterprises.

Ai Group wants to end the “better off overall test” and its replacement with a no-disadvantage test.

It wants further simplification of awards and is opposed to criminal punishment for wage theft.

The Australian Council of Trade Unions secretary Sally McManus has called for the working groups to focus on casual and insecure jobs.

Picture: Ai Group/Innes Willox

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