Wages for award-reliant workers to increase by 3pc

By: Brad Gardner


Trucking companies employing workers on awards will need to increase wages by 3 per cent on July 1.

Wages for award-reliant workers to increase by 3pc
Employees on awards will receive a 3 per cent wage increase from July 1.

 

Trucking companies preparing their budgets for the new financial year will need to factor in wage increases for their workers.

The Fair Work Commission’s (FWC) wage review panel has decided to increase pay for those on awards by 3 per cent from July 1.

The minimum wage will also rise to $640.90 per week or $16.87 per hour. The figure marks an $18.70 increase to the weekly rate or 50 cents per hour to the hourly rate.

The changes will take effect on the same day heavy vehicle registration charges rise by 1.3 per cent and the superannuation guarantee rate increases to 9.5 per cent.

FWC president Iain Ross says a combination of factors including deterioration in the living standards of award-reliant workers, improvements in labour productivity growth and no cost pressures from the labour market justify the increases.

"It is appropriate in all the of the circumstances that the national minimum wage and minimum wages in modern awards be increased," he says.

"Wages growth is forecast to increase only moderately from current low levels. The outlook for contained inflation growth and relatively low aggregate wages growth provide scope for increasing minimum wages without inflationary consequences."

Queensland Trucking Association (QTA) CEO Peter Garske says the commission’s decision will have an effect on trucking companies at a time when many are struggling.

"There are clearly lots and lots of small businesses that are relying on the award as the basis of their employment management and so it will have an impact, no doubt about that," he says.

"It’s certainly at a level that will require employers to re-evaluate their commercial arrangements to make sure they are being adequately compensated in their freight rates.

The Australian Industry Group (Ai Group) claims the 3 per cent increase in wages is too high and will put pressure on struggling businesses.

"Many industry sectors, and particularly those exposed to import competition, are experiencing very tough business conditions.  This includes manufacturing, retail and tourism businesses, for example, for whom this decision is not at all helpful," Ai Group chief executive Innes Willox says.

However, the increase could have been higher. Ross says the commission factored in the impending increase to the rate of the superannuation guarantee when reviewing the minimum wage.

The rate will go from 9 to 9.5 per cent on July 1 and eventually rise to 12 per cent by July 2019.

"The superannuation guarantee rate increase to apply from July 1, 2014 has been a moderating factor in our assessment of the adjustment that should be made to minimum wages," Ross says.

He says the wage increase awarded is lower than it otherwise would have been in the absence of an increase in the superannuation rate.

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