Supermarkets, retailers call for wage freeze amid rising living costs

Supermarkets and retailers are calling for a wage freeze for essential workers despite soaring cost-of-living pressures that are eating into pay packets.

The Master Grocers Association, which represents brands such as IGA, Foodworks, and hardware chain Mitre 10, is warning against any increase in the minimum pay as the federal government spruiks real wage growth in its budget.

The peak body that represents grocers such as IGA is calling for a wage freeze.Credit:Glenn Hunt

The union movement is pushing for the national minimum wage to be raised by five per cent, which would lift the minimum hourly rate to $21.35, a rise of $1.02. That would also apply the same percentage increase to the pay of about two million employees on higher industry awards that are linked to the national minimum wage.

In a submission to Fair Work’s annual wage review, the MGA says “any increase in minimum award wage in 2022 would severely damage the continuing viability of many small businesses as they grapple with the ongoing threat of COVID-19 and the recovery process”.

Australian Council of Trade Unions secretary Sally McManus said the five per cent increase was “what is needed for Australian workers to keep their heads above water”.

“Today we are calling on Scott Morrison to support the workers of Australia and back this
pay increase,” she said.

ACTU secretary Sally McManus is calling for a five per cent wage rise this year.Credit:Paul Jeffers

Major employer groups are expected to make their submissions to the industrial umpire in the coming days.

The federal budget predicts wages will increase by 2.75 per cent in the year to June, well below the inflation forecast of 4.25 per cent. A return to real wages growth is forecast for the 2022-23 financial year, when wages are tipped to rise by 3.25 per cent versus an inflation rate of 3 per cent.

The federal government has offered one-off payments to certain welfare recipients, a one-off increase in the low-to-middle income tax offset, and a temporary cut to the fuel excise to ease cost-of-living pressures on Australians.

The MGA said small-to-medium retailers had been devastated by the combined effects of flooding and the pandemic, with vaccine mandates resulting in operators losing long-term, senior staff, or putting employees on paid leave while hiring others to fill the void.

The association also says independent retailers “face an ongoing fear of worker’s compensation claims and rising premiums due to staff contracting COVID-19”.

“Members also faced considerable backlash from customers and members of the public when required to implement government directions regarding face masks, check-in, and vaccination requirements, among other things,” the association says.

MGA says a 2.5 per cent wage increase was passed on in September, after an annual increase was staggered for various awards, and it didn’t support any increase in 2022, but qualifies, if a uniform rise has to occur, “a modest increase of 0.5 per cent would be appropriate”.

SDA national secretary Gerard Dwyer says the MGA’s submission is unconscionable.Credit:Nick Moir

Gerard Dwyer, national secretary of retail workers’ union SDA, said a wage freeze was “unconscionable”.

“After two years on the pandemic frontline serving our community and after suffering two delayed pay rises, this is how the MGA wants to reward essential retail workers,” Mr Dwyer said.

Treasurer Josh Frydenberg said low unemployment figures and a tight labour market would force employers to be competitive in attracting staff, which would in turn lift wages.

Jacqueline Maley cuts through the noise of the federal election campaign with news, views and expert analysis. Sign up to our Australia Votes 2022 newsletter here.

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