More than half of major employers in Australia would like to freeze employees’ wages or offer below-inflation pay rises that are a cut in real terms, according to a new survey by a leading industrial relations law firm.
The Herbert Smith Freehills bargaining survey found that 60% of employers want to grant workers only nominal wage increases or to freeze wages, and many more are looking to cut other conditions from workplace agreements. 93% of companies wanted to remove what they consider to be “unproductive or inflexible” conditions in their next round of bargaining, with 20% of those seeking significant change.
The survey will give further ammunition to the union movement, which wants legal changes to increase its bargaining power and has been arguing that big business cannot be trusted to pass on the Turnbull government’s proposed company tax cut. Malcolm Turnbull and the treasurer, Scott Morrison, have argued that cutting the company tax rate from 30% to 25% for companies earning more than $50m a year at a cost of $30bn over 10 years would increase investment, demand for labour and wages. But the ACTU and the progressive thinktank the Australia Institute have disputed that company tax cuts will go towards wage rises. The Treasury secretary, John Fraser, has said the entire $65bn company tax cut package would boost wages by just $750 over time.
Wages in Australia have stagnated. Figures released in August show that in the past year wages grew by a record low of 1.9%. The secretary of the Australian Council of Trade Unions, Sally McManus, said that over the past 10 years productivity had increased twice as fast as wages so something was “clearly wrong” with the industrial relations system.
The Minerals Council of Australia is calling for a reduction in unions’ powers to strike over the content of workplace agreements and the reintroduction of individual workplace contracts for high-income earners rather than collective agreements. The Australian Mines and Metals Association wants to abolish the award safety net, which sets conditions for 2.3m workers and provides a floor below which conditions of collective agreements cannot fall.
McManus accused the mining lobby of being “ideological warriors for trickle-down economics who want to boost their profits the expense of working people”.