The Fair Work Commission has pressed ahead with its annual wage review and has announced a 1.75% increase to the national minimum wage (NMW).
The change will take effect in the retail industry from February 01 2021 and will see the minimum wage increase to $753.80 per week or $19.84 per hour.
The National Retail Association and the Australian Retailers Association and others had expressed concerns about the increase going ahead at this time when retailers are already struggling.
However, the majority decision - handed down by Justice Ross; Vice President Catanzariti; Deputy President Asbury; Commissioner Hampton; Mr Ferguson; and, Ms Labine Romain - stated that the increase is lower than what was proposed by some organisations.
"In our view awarding an increase of the magnitude proposed by the Australian Council of Trade Unions (ACTU - proposed a 4% increase) [and others] in the present economic circumstances, would pose a real risk of disemployment and of adversely affecting the employment opportunities of low-skilled and young workers.
"We acknowledge that any increase we award which is less than increases in prices and living costs would amount to a real wage cut.
"Such an outcome would mean that many award-reliant employees, particularly low-paid employees, would be less able to meet their needs.
"For some households such an outcome would lead to further disadvantage and may place them at greater risk of moving into poverty.
"We have decided to award a substantially lower increase this year than that awarded last year due to the marked change in the economic environment and the tax-transfer system and other changes which have taken effect in the current Review period which have benefitted low-paid households.
"The increases we have awarded are likely to maintain the real value of the wages of NMW and award-reliant employees," the majority said.
National Retail Association CEO Dominique Lamb said that many retailers won't be able to afford the increase.
"We cannot deny that we are disappointed by this decision.
"It is hard to reconcile this verdict with the events of the past six months and the current economic climate.
"The bottom line is that businesses cannot pay money that they do not have and will likely be hit with two wage increases in February and July 2021.
"On February 1 next year, struggling retailers will wake up to find they are in a continuing nightmare, where the Fair Work Commission completely ignores the commercial reality of being in business in Australia today.
"They will wake up to the recurring problem of widespread failure of retail businesses, which will be compounded by wage increases that many simply cannot afford," she said.