[Australia] 'Dire' impact of push to change young workers’ pay

In Australia, hearings have begun at the Fair Work Commission on a case with the potential to transform how hundreds of thousands of young workers are paid, HRD reports.

Australia’s largest retail union, the Shop, Distributive and Allied Employees’ Association (SDA), has launched a formal bid to abolish “junior” pay rates for workers aged 18 and over in the retail, fast-food and pharmacy sectors. 

Such a move could reportedly significantly raise wage costs for employers across some of the nation’s largest industries.

Current award arrangements allow for employees under 21 to be paid a percentage of the adult rate; typically 70 per cent at age 18, 80 per cent at 19 and 90 per cent at 20.

The SDA’s application seeks to increase these rates to 100 per cent of the adult rate from age 18, while also raising the pay scales for younger workers. This would see wages for 17-year-olds rising from roughly 60 per cent to 75 per cent and under-16s from about 45 per cent to 50 per cent.

The case targets three modern awards: the General Retail Industry Award, the Fast Food Industry Award and the Pharmacy Industry Award. Hearings are scheduled to run into early November 2025.

The union is reportedly arguing that once an individual turns 18, they are legally an adult and should be paid as such. The SDA has framed its campaign under the banner “Adult age = Adult wage”. It contends that young adults often perform the same duties as older colleagues, yet earn substantially less purely because of their age.

The Australian Council of Trade Unions has backed the claim, describing age-based pay scales as “discriminatory and outdated” and arguing that they fail to reflect the rising cost of living faced by young workers.

ACTU President Michele O’Neil said, “Most 18-year-olds in these sectors aren’t new to their jobs. They often started at 15 or 16. 

"By 18, they know the systems, the customers, the weekend rush. Many can run a close. They often supervise older workers. Paying them less just because they’re younger doesn’t reward work. It unfairly discounts it."

But employer groups have warned about the potential financial shock such a change could bring.

The Australian Retailers Association and others reportedly argue that junior rates serve a vital role in helping young people find their first jobs and gain experience, particularly in industries with tight margins and high turnover.

In a statement, Australian Retailers Association CEO Chris Rodwell said, “Retail is the single largest employer of young Australians, employing more than 500,000 workers under the age of 24 years. 

“If junior rates are tampered with, the impact on already high youth employment could be dire – particularly in regional areas."

One industry submission to the FWC reportedly stated, “This could have a catastrophic effect on entry-level employment,” suggesting that fewer training opportunities and higher automation risks could follow if labour costs spike overnight.

Source: HRD

(Link and quotes via original reporting)

In Australia, hearings have begun at the Fair Work Commission on a case with the potential to transform how hundreds of thousands of young workers are paid, HRD reports.

Australia’s largest retail union, the Shop, Distributive and Allied Employees’ Association (SDA), has launched a formal bid to abolish “junior” pay rates for workers aged 18 and over in the retail, fast-food and pharmacy sectors. 

Such a move could reportedly significantly raise wage costs for employers across some of the nation’s largest industries.

Current award arrangements allow for employees under 21 to be paid a percentage of the adult rate; typically 70 per cent at age 18, 80 per cent at 19 and 90 per cent at 20.

The SDA’s application seeks to increase these rates to 100 per cent of the adult rate from age 18, while also raising the pay scales for younger workers. This would see wages for 17-year-olds rising from roughly 60 per cent to 75 per cent and under-16s from about 45 per cent to 50 per cent.

The case targets three modern awards: the General Retail Industry Award, the Fast Food Industry Award and the Pharmacy Industry Award. Hearings are scheduled to run into early November 2025.

The union is reportedly arguing that once an individual turns 18, they are legally an adult and should be paid as such. The SDA has framed its campaign under the banner “Adult age = Adult wage”. It contends that young adults often perform the same duties as older colleagues, yet earn substantially less purely because of their age.

The Australian Council of Trade Unions has backed the claim, describing age-based pay scales as “discriminatory and outdated” and arguing that they fail to reflect the rising cost of living faced by young workers.

ACTU President Michele O’Neil said, “Most 18-year-olds in these sectors aren’t new to their jobs. They often started at 15 or 16. 

"By 18, they know the systems, the customers, the weekend rush. Many can run a close. They often supervise older workers. Paying them less just because they’re younger doesn’t reward work. It unfairly discounts it."

But employer groups have warned about the potential financial shock such a change could bring.

The Australian Retailers Association and others reportedly argue that junior rates serve a vital role in helping young people find their first jobs and gain experience, particularly in industries with tight margins and high turnover.

In a statement, Australian Retailers Association CEO Chris Rodwell said, “Retail is the single largest employer of young Australians, employing more than 500,000 workers under the age of 24 years. 

“If junior rates are tampered with, the impact on already high youth employment could be dire – particularly in regional areas."

One industry submission to the FWC reportedly stated, “This could have a catastrophic effect on entry-level employment,” suggesting that fewer training opportunities and higher automation risks could follow if labour costs spike overnight.

Source: HRD

(Link and quotes via original reporting)