Yet Another Blow for Small Business Owners

This week the Fair Work Commission in their ‘wisdom’ decided to throw another curve ball at small business owners. From 1 July this year, the minimum rates in all Modern Awards will be increased by 3%. While this is less than last year’s increase of 3.5%, it is difficult to understand how the Commission, given the current economic climate, can rationalise the increase. With inflation at its all-time low, small business owners will have to fork out the additional costs straight from their pockets as the market conditions simply provide no real prospect of increasing prices to soften the blow.

Proceedings leading up to the decision to increase the minimum wage has unfortunately followed a familiar trend with employer groups proposing a 1.8% increase and the Australian Council of Trade Unions (ACTU) presenting an ambit claim of 6%. In its weakness and as is so often the case, the Commission settled in the middle; seemingly oblivious to the real impact on small businesses.

But it is not only small businesses that are affected. Jobseekers are perhaps even more affected because its been shown that each minimum wage increase puts the dignity of work, further out of reach. Raising the minimum wage has a direct impact on the creation of new, entry level jobs. Work is the key to stimulate the economy. But even more so, work provides people with dignity, it provides people the opportunity to build skills and enjoy success. Work is critical in people having a good and balanced life.      

Business owners who will be affected by these changes and who may be expected to experience distress in their businesses, are encouraged to contact Philip van den Heever at philip@franklaw.com.au 

This is not legal advice. 

Photo by Patrick Tomasso on Unsplash