Unions push for more leave and to axe junior wages

Unions are leading a push to boost pay for junior workers facing 'discrimination'.

Unions are leading a push to boost pay for junior workers facing 'discrimination'. Photo: Getty

A push to outlaw junior pay rates has thrust the plight of young workers struggling to make ends meet into the political spotlight.

Unions have launched a landmark case with the industrial umpire seeking to stop employers from paying hundreds of thousands of workers aged 18-20 far less than their older colleagues.

The practice, widespread across 75 awards including hospitality, retail and fast food, cuts the wages of about 500,000 workers, sometimes by more than $10 an hour.

The Australian Council of Trade Unions (ACTU) described the case as a bid for “wage justice” amid mounting intergenerational inequality, with young people struggling most with the cost of living.

But employers have come out swinging, arguing businesses take on additional risks hiring young workers and that pay equity would deliver a drag on youth employment rates.

Fiona Macdonald, policy director at the Australia Institute’s Centre for Future Work, said employer claims, including that young workers are less experienced and therefore less valuable, are wrong.

“They’re often employed in industries that are low paid and don’t have highly complex skill requirements, workers can be equally as productive as someone who is older,” MacDonald said.

Young workers struggle

The wage push comes against the backdrop of mounting economic woes for young Australians, who research shows suffer most from the effects of high inflation and slowing economic growth.

Fast food workers have previously expressed their anger at junior pay rates  with one 18-year old employee telling InQld that the wage inequality is unjust.

“My living expenses are comparable to those of 30-year-olds,” they said.

“It’s absolutely unjust that I’m only paid half of the minimum national wage only because I ‘lack experience’.

“Remind me of exactly what I’m getting experience at? Washing dishes? Sweeping the floor?”

MacDonald said that junior pay rates were set up years ago when it was much more common for young workers to get their foot in the door at a particular company and then stay to further their career.

They would then be rewarded with higher wages later, but that’s often not the case these days, where workers are much more likely to take casual jobs at big companies and then move on.

“It’s not been set up as discriminatory … [but] it represents discrimination now,” MacDonald said.

Industrial battle lines

Clear industrial battle lines are being drawn on either side of the Fair Work Commission case, which will consider arguments from all lobbyists before delivering a ruling.

Under junior pay rates an 18-year old retail worker may have to work more than 50 hours a week to earn a full-time adult wage, despite many facing rising bills for rent, utilities and education.

The union case would force employers to pay all adult workers the same rates and would abolish  “training wages” for apprentices amid accusations employers use them to cut costs.

ACTU Secretary Sally McManus said such pay rates are a form of “wage discrimination” and needed to be stamped out.

“The cards are already so heavily stacked against young workers. It is unfair for them to have to work harder and longer to pay the same bills as other adults,” McManus said.

The Australian Chamber of Commerce and Industry (ACCI) claims that abolishing the lower rates will mean employers hire fewer young workers, robbing them of experience.

“Taking on a worker with minimal experience requires extra risk and extra effort – they do not have the work or life experience that older adults have,” ACCI policy chief David Alexander said.

“This would be catastrophic for young workers, especially in retail, who would struggle to get a start in the workplace.”

But MacDonald said that the lower rates of pay for younger workers don’t reflect the important role of their incomes for their families.

“Research has shown over and over again that many young people’s incomes contribute to essential household incomes in lower income families,” MacDonald said.

Push for more leave

Abolishing junior pay rates isn’t the only issue that unions have been campaigning on this week, with a separate push to increase annual leave for all workers to five weeks.

The leave proposal would change annual leave in National Employment Standards from 20 to 25 days and lift casual loading rates, the union stated.

It would need the support of the Albanese government, which has won plaudits from union leaders for pursuing widespread industrial reforms during its first term in office.

Gemma Beale, an executive director for South Australia and the Northern Territory at think tank the McKell Institute said additional annual leave would be a positive step for workers.

“This is a much-needed initiative,” Beale said.

“Time off work, especially extended time off work – more than a day or two at once – is central to a healthy work-life balance.”

Topics: Employment
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