Retail groups have expressed their concern over the Fair Work Commission's (FWC) decision to increase the minimum wage.
The FWC handed down its decision yesterday, announcing that the national minimum wage (NMW) would increase by 2.5% from July 01 2021.
However, retailers covered by the General Retail Industry Award 2020 have been granted a delayed commencement date to September 01 2021.
Australian Retailers Association CEO Paul Zahra said that while a delayed start date is welcomed, the increase still puts pressure on retailers recovering from the pandemic.
"Whilst we appreciate the FWC delaying the increase for retailers, which is in line with the ARA’s advocacy, the timing of the increase remains a significant concern coming only months after the previous increase and just ahead of the critical Christmas trading period which is the most expansive employment period for retailers," he said.
"Businesses are still adjusting to the last wage increase on 1 February this year and face additional pressure when an increase to the Superannuation Guarantee increase kicks in from 1 July.
"Our economic recovery remains uneven, with many businesses – particularly small businesses in CBD locations, travel retail and in Victoria – continuing to struggle for survival," Zahra said.
The FWC's decision puts the NMW at $772.60 per 38-hour week or $20.33 per hour.
This constitutes an increase of $18.80 per week to the weekly rate or 49 cents per hour to the hourly rate.
National Retail Association CEO Dominique Lams said the increase comes at a time when there is still a large amount of uncertainty in the sector.
"Retailers would have liked a more balanced approach that would have seen a more modest rise given there remains much uncertainty in the business community.
"We absolutely want workers to receive a pay increase but both the amount and the timing needs to be carefully considered.
"Australia is at a delicate point in its recovery from the COVID-recession, which is why the NRA always believed that the prudent approach was an increase in line with CPI coming into effect in November 2021.
"Snap state lockdowns are still not a thing of the past and since the end of March businesses have not had the JobKeeper safety net.
"In 2021 we’ve seen numerous state governments plunge their economies into lockdown and on each occasion official ABS data reveals that retail turnover decreases," she said.
Meanwhile, the Australian Council of Trade Unions (ACTU) welcomed the increase, but expressed its concern over the delayed start date for retailers, many of whose staff have worked throughout the pandemic or have lost work due to it.
"This wage increase has come about because of unions, the Morrison Government and big business wanted pay cuts or freezes," ACTU secretary Sally McManus said.
"However, it is extremely disappointing that the Commission has delayed increases for any workers – but especially those who have worked throughout the pandemic and whose employers have posted record profits.
"Wage suppression in our country needs to stop," McManus continued.
"Suppressing wages hurts the economic recovery and it hurts working people, their families and communities. There can be no economic recovery without a wages recovery.
"Pay increase will be spent in local communities across the country and will help small and medium businesses as well as working people get back on their feet after the pandemic.
"This wage rise goes to one in four working people – and this process is the only avenue those people have to a pay rise each year," she said.
When coming to its decision, the FWC considered the positive economic situation Australia is in following the pandemic.
The full FWC decision and summary can be found on the FWC website.