Industry associations have raised concerns over the Fair Work Commission’s (FWC) decision to increase the national minimum wage by 2.5 per cent as hospitality businesses are still struggling from the economic impact of the COVID-19 pandemic.

The FWC increased the minimum wage to $20.33 per hour, a $0.49 per hour rise meaning the minimum a full-time employee will receive is $772.60 per week, an increase of $18.80. The rise in wages will again be staggered over several months and will take effect from 1 September for the general retail award and from 1 November for hospitality and restaurant awards.

The Australian Hotels Association (AHA) said the decision will put pressure on hotel and hospitality businesses, meaning State and Territory Governments must provide certainty around COVID-19 restrictions and lift capacity constraints.

AHA CEO Stephen Ferguson said for businesses to be able to afford wage increases, they need to be open and trading at capacity.

“Australia’s hotels and hospitality businesses need to have policy certainty if they are to grow, employ more workers and be able to deliver today’s wage increases,” Mr Ferguson said.

“We commend the Commission’s decision to delay the minimum wage increase until November, but we must keep in mind that from July all businesses will incur additional wage costs through the rise in the Superannuation Guarantee to 10 per cent.”

“The rise in the minimum wage coupled with the superannuation increase means wages will effectively rise by three percent this year.”

“We must also remember that parts of Australia’s accommodation, tourism and hospitality industry continue to face significant challenges, in particular CBD hotels as well as the entertainment, meetings, conferences and events sector who continue to struggle.”

“With international borders closed for the foreseeable future, it is vital that interstate travel remains open and governments around Australia look towards removing all possible trading restrictions.”

Restaurant & Catering Australia (R&CA) said they were “gobsmacked at the decision”, with CEO Wes Lambert saying: “R&CA lobbied strongly to make the case that continued extraordinary circumstances warranted a delay in the increase for our sector. We are very pleased that the commission has accepted our arguments and has set the date of increase for the hospitality sector to 1 November 2021, a 4-month delay.

“However, this decision, that increases the Award rates at double the rate of inflation, could send thousands of small cafes and restaurants to the wall.

“It is unfathomable that the hospitality sector, which has been the hardest hit sector of our economy, should have to wear two wage increases within a year totalling 4.25 per cent.

“This is on top of a further increase to the superannuation guarantee of 0.5 per cent which begins on 1 July, resulting in a total increase of wage costs of nearly five per cent in nine months.”

Andy Young

Andy joined Intermedia as Editor of The Shout in 2015, writing news on a daily basis and also writing features for National Liquor News. Now Managing Editor of both The Shout and Bars and Clubs.

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