Pay rise a double-edged sword

Bendigo Weekly | Bendigo Weekly | 03-Feb-2012

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This week’s historic decision by Fair Work Australia to award huge pay rises for more than 150,000 community sector workers should help narrow the unacceptable pay gap between men and women in Australia.
Unfortunately, it also looks like creating a whole new raft of problems for the industry, with employers worried at just how the increases will be funded, and there is already talk of the potential need for cutbacks in order to deliver the wage increases, something the community service sector, and the people it serves, can ill afford.
Unions claim that once the annual award increases are factored in, this week’s Fair Work Australia decision is expected to boost the pay of the mostly female workforce by 40 to 65 per cent over the next eight years.
Prime Minister Julia Gillard described the ruling as a ‘’significant advance for equal pay for women’’, but employer groups have greeted the announcement with hostility and anger.
For its part, the Victorian government has also pointed out, rather ominously, that the decision has ‘’major financial and service provision implications for Victoria’’, which it will ‘’carefully consider’’.
In the lead up to the 2010 state election, the coalition pledged $200 million over four years to ensure ‘’community sector workers are better paid in order to reflect the importance and value of their work. We will reflect the Fair Work Australia wage increase in our service agreements with community sector organisations and ensure that workers receive a significant pay increase.’’
The problem for the Victorian government, and others, is that they would not have anticipated this week’s majority decision of Fair Work Australia to include pay rises of the magnitude handed down on Wednesday.
In a statement released in the wake of Wednesday’s ruling, the coalition said it supports the vital work performed by community sector workers, and the principle of equal pay for work of equal or comparable value.
But the coalition says it is vital for the Federal Government to provide what it’s calling ‘a substantial and ongoing financial commitment’ to help meet the very heavy costs imposed on state governments and non-government organisations as a result of the Commonwealth’s role in this case.
Clearly, there needs to be dialogue between the various levels of government over this matter to make sure the Fair Work Australia ruling is passed on and delivered in a manner that is sustainable and does not compromise either the economic viability of any agency working in the community service sector, or the level of service they provide.
As a colleague of mine said to me earlier this week, you can’t shake hands with a clenched fist, so for the sake of the people who matter most in all this, let’s hope the issue of how to deliver these pay increases can be overcome swiftly and with the maturity, respect and sensitivity it deserves.
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