Pay rise to worry small family businesses

Today’s decision to raise the minimum wage by $40 per week or 5.2 per cent is going to create stress and worry for many small businesses, according to CCIWA Chief Economist Aaron Morey.

The Fair Work Commission’s decision, which affects roughly 300,000 WA employees (including those whose pay is influenced by awards), is also expected to strongly influence the upcoming State Wage Case decision by the WA Industrial Relations Commission, which increases rates of pay affecting WA smallest businesses (sole traders and partnerships).

Morey spoke to ABC 720’s Nadia Mitsopoulos this morning about what the unexpectedly high rise would mean for employers.

“This 5.2 per cent increase is going to create stress and worry for many small businesses, particularly in retail and hospitality,” Morey said.

“They’re already battling surging costs for their businesses. These are people, too. I mean these are people who have taken a risk, probably using their family home as collateral on their business loan.

“My challenge to the community and to those listeners, Nadia, is to extend their empathy and compassion — yes, to workers — to include the small business owners who are very stressed and worried about the future of their family businesses.”

Hear the full interview between Nadia Mitsopoulos and CCIWA’s Aaron Morey.

Are you affected by the minimum wage increase? Our Employee Relations Advice Centre is available to respond to your questions on (08) 9365 7660, or via [email protected].

A rough breakdown of the number of award-reliant workers who’ll be receiving the 5.2 per cent pay rise shows more than a third are employed in the sectors that have been most affected by COVID in the past two years:

  • Retail trade (33,000)
  • Accommodation and food services (48,000)
  • Manufacturing (14,000)
  • Construction (13,000)

The State’s tourism industry has also been heavily affected by COVID-related travel restrictions.

The unions sought a 5.5 per cent increase; the new Federal Government supported a 5.1 per cent rate (in line with headline inflation); while business proposed a three per cent increase.

As Morey said today, “Our decision-making around the minimum wage — which we both know should increase — should get a balance across those interests; for the individuals who need that pay rise, but also accounting for these poor small business owners who are stressed and worried and already absolutely stretched when it comes to making any money at all for their families.”

For more information on IR changes and awards, contact CCIWA’s Employee Relations Advice Centre on (08) 9365 7660 or [email protected].

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