Peak retail industry body the Australian Retailers Association (ARA) strongly condemned the Fair Work Commission (FWC) junior wage decision which risks the future of Australian retail workers after the FWC today announced that 20 year old employees will now be paid adult rates.
ARA Executive Director Russell Zimmerman said the shock decision was based on no evidence and will kill jobs for youth as well as hinder skills developments.
“This decision is inconsistent with previous FWC decisions, making it obvious this was a narrow review. Previous FWC decisions have held that major changes like this require expert evidence.
“It is extremely concerning to business in Australia that the only substantial decisions coming out of the 2012 Review resulted in increased conditions for employees and increased costs for employers.
“The ARA calls on the new Government and Employment Minister Abetz to do everything in his power to halt this increase and fight against the already promised claims from the union movement to move on under 20 year old pay rates.
“The former government should be ashamed at the dishonest approach it took to this case – they provided the FWC with deliberately misleading information and supported a flimsy case when they took the polar opposite approach to the ARA’s application to allow some relief on Sunday penalty rates.
“This junior wage increase will severely hit retailers financially, as well as change the face of employment for 20 year olds.
“We know that youth unemployment is at its highest level in 11 years, and with the unions case to remove junior wage rates now successful, young Australians are going to really struggle to find employment and support themselves through their studies.
“What retailer is going to employ a young Australian without any experience in the industry, when they can employ someone a few years older with more experience for exactly the same wage? This decision will prove detrimental to both employers and employees.
“Retailers and young Australians have been reliant on pay rates to enable retail to bring on low-skilled young staff and increase their skill levels. Young employees will now find it extremely difficult to find vital training and development opportunities.
“The industry has already been hit with increases to Sunday wages as we transition to 100 percent on Sundays and 50 percent on Saturdays, and if the adult rate is taken down to 18 and 19 year olds then we will see an even larger percentage of youth unemployed.
“The inflexibility in wage costs has already forced some retailers to become unviable or not open on peak trading days such as Sunday.
“Weaker labour market conditions also argue for moderation in the Annual Minimum Wage Review, particularly against the backdrop of a record low youth participation rate and an almost three percent contraction in youth employment in the past year. Young people are done a disservice if our system of wage regulation locks them out of employment opportunities.
“The retail sector is struggling, and although the industry is just starting to show signs of improvement in terms of retail employment, this is certainly a blow to employment confidence,” Mr Zimmerman said.
Russell Zimmerman is available in Melbourne CBD this afternoon from 2.30pm for interviews. Mr Zimmerman will also be in Sydney CBD on Saturday 22 March for interviews. Please phone 0439 612 556.
Visit http://www.fwc.gov.au/decisionssigned/html/2014FWCFB1846.htm to view the decision
Since 1903, the Australian Retailers Association (ARA) has been the peak industry body representing Australia’s $258 billion retail sector, which employs over 1.2 million people. The ARA ensures retail success by informing, protecting, advocating, educating and saving money for its 5,000 independent and national retail members throughout Australia. Visit www.retail.org.au or call 1300 368 041.