Minimum Wage Fixing Convention, 1970 (No. 131) - Australia (Ratification: 1973)

Replies received to the issues raised in a direct request which do not give rise to further comments (CEACR) - adopted 2019, published 109th ILC session (2021)

The Committee notes the information provided by the Government, which answers the points raised in its previous direct request and has no further matters to raise in this regard.

Direct Request (CEACR) - adopted 2011, published 101st ILC session (2012)

Article 1(1) of the Convention. Minimum wage system. The Committee notes the adoption and entry into force of the Fair Work Act 2009, which repeals and replaces the Workplace Relations Act 1996. It also notes the establishment of Fair Work Australia, which began operations on 1 July 2009, and replaced the previous Australian Industrial Relations Commission, the Australian Industrial Registry, and the Australian Fair Pay Commission. It further notes that the new Minimum Wage Panel replaced the Fair Pay Commission as the responsible body for annually reviewing and setting minimum wages in Australia. In an annual wage review, the Panel makes a National Minimum Wage Order which sets minimum wages for employees who are not covered by an industry-specific modern award. According to the latest data published by the Australian Bureau of Statistics, more than 15 per cent of all Australian employees are award-reliant. The Government further indicates that the Panel’s decision might also affect other wages indirectly by acting as a floor for wage increases or workplace bargaining, considering that 36 per cent of federal enterprise collective agreements were linked in some way to annual wage review outcomes. The Committee requests the Government to provide in future reports updated information on the implementation of the Fair Work Act and the operation of the Minimum Wage Panel.

Moreover, the Committee notes the Government’s statement that following the decision of all states other than Western Australia to refer their industrial relations power to the Commonwealth, the New South Wales industrial relations jurisdiction now applies only to the New South Wales public sector. It also notes that the New South Wales’ Industrial Relations Act 1996 was amended by the Industrial Relations Amendment (Public Sector Conditions of Employment) Act 2011, inserting section 146C, which requires that the New South Wales Industrial Relations Commission give effect to any policy on conditions of employment of public sector employees when making or varying awards or orders in relation to the remuneration of public sector employees. In this respect, the Committee notes the comments of the ACTU which considers that the new legislation empowers the Government to effectively dictate wages outcomes to the state tribunal responsible for setting fair and reasonable wages for the state public sector for decades. The ACTU is of the view that this will have a negative effect on more than 300,000 public sector employees of New South Wales and that by constraining the tribunal processes and independence the legislation contravenes the principles set out in the Convention. The Committee requests the Government to communicate any comments it may wish to make in reply to the observations of the ACTU.

Article 2(1). Differentiated minimum wage rates based on age or disability. Further to its previous comment, the Committee notes the Government’s explanations that of the 122 new modern awards, 70 include differentiated minimum wage rates for junior workers while the special national minimum wage order for award/agreement free junior employees also prescribes differentiated rates on the basis of age. The Government further indicates that as regards employees with disability, where a worker’s productivity is not affected by their disability the employee is entitled to be paid the relevant adult, junior or training rate. In this connection, the Committee notes the comments of the ACTU, which has significant concerns with the adequacy of minimum wages for juniors, trainees and apprentices taking into account relative living standards, increases in the cost of living and the principle of equal pay for work of equal or comparable value. The Committee requests the Government to transmit any comments it may wish to make in response to the observations of the ACTU.

Article 5 and Part V of the report form. Enforcement measures and application in practice. The Committee notes the detailed statistics provided by the Government concerning minimum wage enforcement measures and the results obtained in different states and territories as well as the inspection activities carried out by the Fair Work Ombudsman. It also notes the Government’s indication that the Victorian Government has not commissioned any relevant data while Tasmania does not maintain statistical information on this area despite the fact that numerous instances of back pay and underpayment to Tasmanian private sector workers have been reported. The Committee would be grateful if the Government could provide additional clarifications in this respect and also continue to supply up-to-date information on these matters.

Direct Request (CEACR) - adopted 2006, published 96th ILC session (2007)

The Committee takes due note the Government’s detailed report and attached documents, regarding the application of the Convention both at the Commonwealth and the state/territory level. It notes, in particular, the adoption and entry into force of the Work Choices Act 2005, which introduces a number of major reforms including a new minimum wage-fixing institution. Given the extent of the legislative reforms and the difficulty of assessing their impact at such an early stage of implementation, the Committee will defer a full evaluation of the new minimum wage system until it comes fully into effect and more information of a practical nature becomes available.

Article 1, paragraph 1, of the Convention. Further to its previous comment regarding the significant drop of employees covered by federal and state wage awards and the considerable increase of those covered by certified collective or individual agreements, the Committee notes the Government’s reply that the role of awards has changed over the past 10-15 years from a primary mechanism for setting pay and conditions to a safety net of minimum wages and conditions in support of a bargaining framework. According to the Government, the recent legislative changes follow the same trend and seek to allow for more choices and flexibility by moving away from a centralized approach to one focused on agreement-making between workers and employers at the workplace and enterprise levels.

Concerning the minimum wage fixing mechanism at the federal level, the Committee notes the revision of the Workplace Relations Act 1996 by the Workplace Relations Amendment (Work Choices) Act, 2005 (Act No. 153 of 2005), which establishes a new national workplace relations system entered into operation as from 27 March 2006. Under the WorkChoices system, aimed at covering 85 per cent of employees and employers in Australia, the Australian Fair Pay Commission is established to set and maintain the Australian Fair Pay and Conditions Standard. The Standard provides for two frameworks fixing minimum wages: the Australian Pay and Classification Scales (APCSs) and the Federal Minimum Wages (FMWs). The APCSs provide by classification of workers for the guaranteed basic periodic rates of pay, the guaranteed basic piece rates of pay, and the casual loading rates for casual workers which is to be paid in addition to the guaranteed basic periodic rates of pay. For workers not covered by the APCSs, the FMWs apply, which consist of the standard FMW initially set at AUD12.75 per hour at the commencement of WorkChoices, and the special FMW for juniors, trainees, and disabled persons. A transitional system was established and will operate until 2011 during which enterprises not covered by WorkChoices must decide whether they opt for WorkChoices or the relevant state workplace system. The Committee requests the Government to keep it informed of all future developments concerning the implementation of the Work Choices Act and its corresponding Regulations.

Article 1, paragraph 2. The Committee notes the updated information provided by the Government on the initiative of the Government of New South Wales concerning clothing outworkers. It notes, in particular, that following the adoption of the Ethical Clothing Trades Extended Responsibility Scheme, which came into operation on 1 July 2005, and as part of the Behind the Label Strategy, the Ethical Clothing Trades Council was established to improve compliance with industrial law in New South Wales and advise the Government on ways to address the issues facing clothing workers. The Committee would appreciate receiving further information on the main elements of the Strategy, and any results achieved in ensuring minimum wage protection for outworkers.

Article 2, paragraph 1. Further to its previous comment on this point, the Committee notes the Government’s reply according to which the Australian Industrial Relations Commission (AIRC) conducted an inquiry between 1998 and 1999 on wage rates for junior workers under 21 years of age, and concluded that the existing discounted rates for junior workers were necessary for securing employment for young people. Under the new WorkChoices system, such reduced rate for junior workers is applied through a special FMW rate.

Regarding workers with a disability, the Committee notes that sub-minimum wage rates are applied to those who are assessed through the Supported Wage System (SWS) that they are unable to perform at the full minimum wage level. While it is an assessor who determines a rate to be applied to a particular worker, the SWS provides for a minimum amount payable, currently set at AUD62 per week, below which no worker with a disability can be paid. Under WorkChoices, the Fair Pay Commission is in charge of setting rates for workers with a disability through a special APCS or a special FMW, as provided for under sections 197 and 220 of the Act.

The Committee notes the Government’s explanations concerning both junior workers and workers with a disability that if they are to be competitive in the labour market, their minimum wages must reflect their average relative work value. In this connection, it also notes that the SWS was endorsed by the AIRC by virtue of its decision on 10 October 1994, while the system was evaluated by an external enterprise in 1999 and it was concluded that the SWS promoted the participation of employers and employees equally. In this connection, the Committee trusts that the Government will continue to review from time to time the rationale and advisability of fixing differentiated wage rates on grounds such as age or disability.

Article 4, paragraphs 2 and 3. The Committee notes that section 38 of the Work Choices Act provides that the Commissioners of the Fair Pay Commission must have experience in one or more areas including business, economics, community organizations, and workplace relations. It also notes the Government’s information that the Fair Pay Commission, as part of its first wage-setting exercise, is consulting widely stakeholders including employers’ and workers’ organizations at the industry round tables.

Article 5 and Part V of the report form. The Committee notes the statistical information on the number of collective agreements and the percentage of workers covered by collective agreements both at the federal and the state/territory level. It also notes the statistical information on the evolution of minimum rates of pay for New South Wales, Queensland (2005) and Western Australia (2002-05). It further notes the legislative and administrative arrangements for labour inspection in different states and territories, as well as the statistical information on the results of labour inspections in terms of the amounts recovered and the number of workers concerned. The Committee would be grateful if the Government could continue supplying up to date information in these matters.

Direct Request (CEACR) - adopted 2003, published 92nd ILC session (2004)

The Committee takes due note of the Government’s detailed report and attached documentation concerning the Commonwealth and State legislation giving effect to the provisions of the Convention.

Article 1, paragraph 1, of the Convention. The Committee notes the powers and functions of the Australian Industrial Relations Commission (AIRC) under the Workplace Relations Act, 1996 in making wage awards for various classes of workers. According to the Government’s report, there are around 2,200 federal awards which specify minimum rates of pay for various occupations and industry sectors, while 23.2 per cent of all employees have their pay set by federal and state awards. The Committee also notes that the AIRC is required to ensure that a safety net of fair minimum wages and conditions of employment is established having regard to the needs of employees in the light of living standards generally prevailing in the country and economic factors such as the level of productivity, inflation and the desirability of attaining a high level of employment. To this end, the AIRC considers each year an application for an increase in award rates of pay, known as the Safety Net Review - Wages Case. All interested parties, including employers and employee organizations, are notified of any application before the AIRC and may make submissions to the Commission. In its most recent Safety Net Review - Wages Decision of May 2002, the AIRC increased all minimum rates of pay by A$18 per week and set the federal minimum wage at A$431.40 per week.

The Committee further notes that the Workplace Relations Act, 1996, while retaining existing arrangements for making collective (certified) agreements with unions, introduced new arrangements which allow certified agreements to be made directly with employees. Moreover, a new system of individual agreements called Australian Workplace Agreements (AWAs) has been introduced to allow for greater flexibility at workplaces. These agreements can be negotiated collectively but must be signed individually and have to be approved by the Employment Advocate. Both certified agreements and AWAs cannot be less favourable to the employees concerned than the relevant award. According to the data furnished by the Government, in March 2002 there had been 45,000 collective agreements approved by the AIRC covering more than 8 million workers, while in July 2002 there had been 248,000 AWAs filed and approved by the Employment Advocate and the AIRC involving more than 4,300 employers. The Committee notes that, by comparison with statistical figures communicated by the Government in its 1997 report, there seems to be a significant drop in the coverage of employees by federal and state wage awards (23.2 per cent in May 2000 as contrasted to 80 per cent in August 1996) and also a considerable increase in the number of certified collective agreements and individual agreements (45,000 collective agreements and 248,000 AWAs in 2002 as compared to 14,000 collective agreements and 1,280 AWAs in 1997). The Committee invites the Government to comment on this inverse trend and explain what it may practically signify in terms of workers’ minimum wage protection.

Article 1, paragraph 2. The Committee notes the information supplied by the Government of New South Wales concerning the Clothing Outwork Strategy, launched in 2001, to improve the working conditions of home-based clothing outworkers. It requests the Government to keep it informed of any further developments and results achieved in this regard.

In addition, the Committee notes the indication of the Government of Queensland that by virtue of a recent amendment of the Industrial Relations Act, 1999, the Queensland Industrial Relations Commission (QIRC) is required to make a general ruling on a Queensland minimum wage at least once a year so that all employees including those whose employment is not covered by an award or other form of agreement (presently estimated to represent 17 per cent of all employees) have access to a minimum wage. While noting that to date the QIRC has not handed down such general ruling, the Committee requests the Government to keep it informed of any progress made in this respect.

Moreover, the Committee notes the information provided by the Government of Victoria relating to the Industrial Relations Task Force set up in 2000 and the various legislative initiatives undertaken in response to the Task Force report and recommendations. The Committee requests the Government to continue providing detailed information on all those measures, whether planned or implemented, aiming at extending minimum wage coverage to award-free areas of employment.

Article 2, paragraph 1. The Committee notes that existing Commonwealth and State legislation allows for lower minimum wage rates to apply in the case of junior employees. It also notes that, under section 509 of the Workplace Relations Act, 1996, the Australian Industrial Relations Commission may grant exemptions from the minimum rates of pay normally applicable to persons who, because of their age, infirmity or slowness, are unable to obtain work at the relevant minimum rates. In this connection, the Committee wishes to refer to paragraph 176 of its General Survey of 1992 on minimum wages in which it concluded that the reasons that prompted the adoption of lower minimum wage rates for groups of workers on account of their age and disabilities should be regularly re-examined in the light of the principle of equal remuneration for work of equal value and also that remuneration levels should be determined on the basis of objective factors such as the quantity and quality of work performed. The Committee would therefore appreciate receiving additional information on this point, including for instance any recent studies and surveys addressing these issues and examining the advisability of pursuing a policy of minimum wage differentials on account of workers’ characteristics such as age or reduced ability to work arising from a handicap.

Article 5 and Part V of the report form. The Committee notes the increased monetary fines prescribed under the Workplace Relations Act, 1996 for award breaches. It also notes the statistics provided by the Governments of Queensland and Western Australia regarding the number of wage complaints investigated and the amount of unpaid wages recovered in the period 2000-01 and 2001-02 respectively. The Committee requests the Government to continue supplying up-to-date information on the practical application of the Convention at both the federal and state levels, including (i) the evolution of minimum rates of pay, (ii) the available data on the number and different categories of low paid workers not yet covered by minimum wage provisions, and (iii) the results of inspections carried out (e.g. the number of violations observed, the penalties imposed, etc.).

Direct Request (CEACR) - adopted 1997, published 86th ILC session (1998)

The Committee notes the detailed information provided by the Government in reply to its previous comments.

The Committee notes that the Workplace Relations Act, 1996, has replaced the Industrial Relations Act, 1988, with the objective to foster a more direct relationship between employers and employees and thereby reduce the need for uninvited third-party intervention. As concerns the methods for minimum wage fixing, the main features of this Act are as follows: (i) maintaining the award system to provide a safety net of fair minimum wages and conditions which is able to be adjusted over time having regard to the needs of the low paid and other criteria specified in the Act; (ii) ensuring that awards are focused only on minima. Actual wages and conditions should be determined as far as possible by agreement between employers and employees at the workplace or enterprise level; (iii) providing for effective choice and flexibility in reaching both collective and individual agreements to determine wages above the award minimum; (iv) confining the Australian Industrial Relations Commission's arbitral role, so as to avoid inappropriate interaction between agreements and awards and the associated risk of wage instability.

The Committee also notes that the Workplace Relations Act, 1997, that has been enacted in Queensland, is based, inter alia, on a simplified but effective award safety net so that those who choose to remain on the award system will have the benefit of enforceable minimum wages and employment conditions.

Moreover, the Committee notes that, in South Australia, the South Australian Relations Commission is empowered to fix minimum rates of wages through the issuing of awards which relate to industries and occupational classifications of workers. If there is no applicable award and award classification, the minimum rate of remuneration is a rate fixed by the Full Commission.

The Committee requests the Government to continue to provide, in accordance with point V of the report form, general information on the manner in which the Convention is applied in the country, with a particular focus on the application of the award safety net and all groups of workers as yet unprotected and whose coverage would be appropriate under the terms of the Convention.

Direct Request (CEACR) - adopted 1993, published 80th ILC session (1993)

The Committee notes the detailed information supplied by the Government.

1. The Committee notes in particular, the information on developments in the wage-fixing system, as well as the federal Industrial Relations Act, 1988, which repealed and replaced the Conciliation and Arbitration Act, 1904. It notes that section 123 of this Act empowers the Australian Industrial Relations Commission to provide for the payment of wages at a lower rate to employees who are unable to earn a wage at the prescribed minimum rate. The Committee requests the Government to indicate whether special rates have been actually fixed by virtue of this provision, and if so, to state whether consultation in accordance with Article 1, paragraph 2, of the Convention has taken place. It asks the Government to refer in this regard to paragraph 175 of the General Survey of 1992 on minimum wages.

2. The Committee notes that, while placing greater emphasis on workplace bargaining in the wage-fixing system under the above Act, the Government indicates its support for maintenance of a wage safety net to protect those unable to secure wage increases by other means. It requests the Government to indicate the concrete measures taken or envisaged to this end.

3. With reference to the previous comments, the Committee notes with interest the activities of the Clothing Industry Outwork Committee in regulating outworkers' wages. It hopes that the Government will continue to supply in future reports information on developments concerning this Outwork Committee in connection with the rates of pay for outworkers.

4. The Committee also notes with interest that, in the State of Western Australia, workers in the clothing trades are now covered by the State Clothing and Allied Trades Award. It hopes that the Government will continue to supply information on further progress made in the application of the Convention to all groups of workers as yet unprotected and whose coverage would be appropriate under the terms of the Convention.

Direct Request (CEACR) - adopted 1989, published 76th ILC session (1989)

The Committee notes with interest the detailed information supplied by the Government.

1. Further to the general observation and the previous direct request, the Committee notes with interest the measures taken to provide for more effective federal award regulation of outworkers' wages. The modification of the Clothing Trades Award, by decision of the Australian Conciliation and Arbitration Commission of 7 April 1987, guarantees outworkers, who may still operate as independent contractors, the minimum award conditions which apply to factory workers, inter alia, in respect of rates of pay. The Committee notes also that in support of the above Commission's decision the Minister for Industrial Relations has established the tripartite national Clothing Industry Outwork Committee to monitor the implementation of the modifications to the Clothing Trades Award and application of those modifications to outworkers. It hopes that the Government will continue to supply information on the activity of the Clothing Industry Outwork Committee in connection with the rates of pay for outworkers.

2. The Committee notes with interest that, in the states of Victoria and of Western Australia, employees in various occupations (door-to-door salespersons, health studio instructors, male teachers in private boys' schools, farm workers, etc.) referred to in the previous report, now have award coverage. It hopes that the Government will continue to supply information on further progress made in the application of the Convention to all groups of workers as yet unprotected and whose coverage would be appropriate under the terms of the Convention.