2022-23 Annual Wage Review Progress Update

The 2022-23 Annual Wage Review decision was handed down by the Fair Work Commission on 2 June 2023. See our related article.

In 2022, the Fair Work Commission flagged its desire to return to a traditional (i.e. pre-COVID) timeline for the issuing of the Annual Wage Review ruling, meaning a decision on this year’s annual wage increase for award-covered employees is eagerly anticipated in the coming weeks.

Earlier this year, the ACTU began pressing for a whopping 7% increase to award rates of pay, pitched above the CPI of 6.8% (in the 12 months to February), saying the cost-of-living crisis was “even more acute this year than last”, when the ACTU argued for a 5.5% increase. A 7% increase would equate to an extra $56.90 per week ($1.50 per hour) for a full-time worker on the National Minimum Wage, bringing it to $869.50 per week ($22.88 an hour) from the current $812.60 per week ($21.38 an hour). The ACTU has argued that a sizeable wage increase is affordable because businesses have posted strong profits; that minimum and award wage increases had no discernible contribution to inflation last year; and that the biggest risk to the economy is a collapse in consumer spending power as wages have gone backwards.

The Catholic Council for Employment Relations has mirrored ACTU sentiment, pushing for a 7.2% increase followed by a series of “more modest” rises over the next seven years, saying award base rates, “do not create an effective safety net for the low paid”.

In contrast, Australian Industry Group Chief Executive, Innes Willox, labelled the ACTU’s 7% claim “economically reckless and irresponsible”, asserting such a significant rise risks a “recession we didn’t have to have” and encouraged the Commission to exercise caution and restraint. ACCI, Australian Business Industrial and the NSW Business Chamber have endorsed an increase of 3.5% – representing the largest increase ACCI has supported since the inception of the Fair Work Act in 2009 – while AIG eventually settled on a proposed increase of 3.8% in its post-budget submissions. The National Retail Association has recommended an increase limited to 3.25%, which is reportedly still higher than many of their members claim to be able to afford.  

Workplace Relations Minister, Tony Burke, has previously confirmed the Government’s position this year is “consistent” with 2022, when Prime Minister, Anthony Albanese, was quoted as saying Labor “absolutely” supported an increase in the minimum wage equal to the then 5.1% inflation rate, with this year’s submissions again encouraging the Commission to award a wage increase to ensure that the real wages of Australia’s low-paid workers “do not go backwards”.

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