Australia and Canada share much in common, but one striking point of difference is the minimum wage. While Canada has been engulfed in a debate around the minimum wage in recent months, it’s a given in Australia that a barista making your latte or a fast-food worker serving your burger is earning at least $20 an hour.
The principle that employees must be paid a “living wage” dates back to a 1907 decision of the Commonwealth Court of Conciliation and Arbitration, which stated that if an employer was unable to pay a living wage, it was not entitled to operate a business. A living wage was defined in the decision as being sufficient to permit an unskilled worker, a dependent spouse and three dependent children to live in “frugal comfort.”
Today, the majority (around 60 per cent) of all Australian employees are covered by one of two collectively determined standards – Modern Awards or Enterprise Agreements. Modern Awards set wages by industry or occupation and take into account levels of experience, skill and responsibility within the workplace. Additional pay is usually required for overtime and work on nights and weekends. Enterprise Agreements are much like Canadian collective agreements and largely exist at the workplace level. They must build upon minimum Modern Award standards, often through a wage increase of some description.