Industrial commission undermines wages

Issue 

Industrial commission undermines wages

By James Vassilopoulos

The Australian Industrial Relations Commission (AIRC) ruled on October 20 that paid rates awards — awards that specify actual pay, rather than minimum pay — will be changed so as to regulate only minimum entitlements.

Under the old system, about 1.5 million workers were covered by paid rates awards. This included nurses, teachers, public servants, Telstra technicians, manufacturing workers and workers from the airline industry.

The full bench of the AIRC, headed by AIRC president and ex-Rio Tinto barrister Geoff Giudice, ruled that rates of pay "should be subject to a conversion process".

Wages which fall under paid rates awards will now have two components — a minimum and a residual component.

Wage rates will not be cut, but award "safety net" increases will be absorbed into the residual component, meaning that workers will not get the increases they used to get. Pay rates in paid rates awards will eventually be the same as minimum rates awards.

Wage increments — in which workers' wages within a particular classification automatically increase — "should not appear in minimum rates awards", according to the AIRC decision.

The workers who will lose the most from this decision will be weakly organised workers on paid rates awards. They will be unable to roll the difference in wages into an enterprise agreement.

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