Federal Government Refuses to Fund Salary Increases Nov 2010

Earlier this year the Australian Services Union (‘ASU’) presented a case to Fair Work Australia requesting it to address the substantial inequities that existed between female workers in the community service sector and those working in other parts of the economy.

The submission was undertaken with the full support of the Labor Federal Government. However, in the Government’s submission to Fair Work Australia late week (Government Submission) on the Equal Remuneration Case, it has made it clear that it will not fund any increases in salaries that are awarded by Fair Work Australia in this case.

The Federal Government’s position means that in the event that Fair Work Australia provides for necessary increases in wages for workers in the community sector, not for profit organisations will need to find the money out of existing Government funding. The inadequacy of Government funding is the basis for the wages inequity as the funding is so poor that organisations struggle to meet wages costs and other overheads. Consequently, any wage increase can only occur through a reduction in services and associated cut backs in employment.

The Government justifies its position by stating that funding any Fair Work Australia wage increase will negatively impact on its plan to return the budget to surplus. It appears that the Government is so concerned with its political agenda that it is willing to maintain what is a patently unjust level of wages for tens of thousands of women and men that work in the not for profit sector. These workers mainly service government contracts. The Federal Government seems to be willing to save money through maintaining the poorly paid Government contracts that have led to the very injustices that Fair Work Australia has been asked to address.

The Government’s position is unacceptable to not of profit service providers who do not want to see a reduction in services to the Australian community. They also do not wish to see any decrease in the quality of those services. Employers in the not for profit sector have long argued for a better deal for their workers but this can only happen if the Australian Government is willing to undo what is an unfair and unjust situation. The Government must change its position on this very important issue.