Junior pay rates for workers over 18 should be scrapped, the head of Australia’s peak union body says, labelling the wage as discriminatory.

Australian Council of Trade Unions president Michele O’Neil has urged the federal government to make workplace law changes that would allow for workers aged 18-21 in industries such as retail and fast food to be paid adult wages, rather than junior rates.

But business groups have argued the move, which would affect more than 500,000 workers, would lead to young people not being able to get into the workforce.

O’Neil said adult wages for junior workers would allow for them to keep up with rising living costs.

“Paying junior wage rates for workers aged 18 and over is discriminatory and out of date,” she said.

“Young workers aged 18-21 in retail, fast food and pharmacy are being paid less, solely based on their age. They aren’t paying less for their rent, groceries or energy bills.”

O’Neil said younger employees should not be forced to accept a percentage of the adult rate for doing the same jobs as other workers.

“They are doing the same work, with the same skills and facing the same cost of living pressures as older workers,” she said.

Business Council of Australia chief executive Bran Black argued the move would create complexity for companies.

“This approach could have the consequence of stopping many young people getting a start in life with their first job,” he said.

“The burden of increased workplace red tape is harder and harder to bear, so these types of changes would come at precisely the wrong time.”

Australian Chamber of Commerce and Industry chief executive Andrew McKellar said the union’s calls were an attempt to influence the Fair Work Commission.

“Youth unemployment is already much higher than the general population at 9.8 per cent; the ACTU should not be seeking to circumvent the commission,” he said.

-AAP