Return to Oz
In Australia, $7.75 an hour is for children
© Bryan Zepp Jamieson
February 26th 2013
About 18 months ago, I wrote about Australia’s minimum wage laws, and with Congress poised to reject out of hand a presidential suggestion that the minimum wage should be raised to $9 an hour in the world’s richest country, it’s time to revisit Australia.
I wrote at the time, “Australia passed the Fair Work Act of 2009, which took effect in the form of the National Employment Standards on January 1, 2010. The act covers roughly 2/3rds of Australia’s workers (about 27% of the workforce are deemed “casual workers” defined by a tautology; they are called casual workers because they are paid as casual workers). Some of the provisions are, by American standards, utterly amazing.”
The minimum wage was $569.90 per week, then. Now it’s $606.40, based on a 38 hour work week, or $15.96 an hour. “Casual employees” (part timers) get a minimum of $21.66 an hour, which encourages employers to hire full-time workers and save money.
From that 2011 piece:
As for the other provisions, here’s what the NES website says:
The NES are set out in the Fair Work Act 2009 and comprise 10 minimum standards of employment. In summary, the NES involve the following minimum entitlements:
Maximum weekly hours of work – 38 hours per week, plus reasonable additional hours.
Requests for flexible working arrangements – allows parents or carers of a child under school age or of a child under 18 with a disability, to request a change in working arrangements to assist with the child’s care.
Parental leave and related entitlements – up to 12 months unpaid leave for every employee, plus a right to request an additional 12 months unpaid leave, and other forms of maternity, paternity and adoption related leave.
Annual leave – 4 weeks paid leave per year, plus an additional week for certain shift workers.
Personal / carer’s leave and compassionate leave – 10 days paid personal / carer’s leave, two days unpaid carer’s leave as required, and two days compassionate leave (unpaid for casuals) as required.
Community service leave – unpaid leave for voluntary emergency activities and leave for jury service, with an entitlement to be paid for up to 10 days for jury service.
Long service leave – a transitional entitlement for employees who had certain LSL entitlements before 1/1/10 pending the development of a uniform national long service leave standard.
Public holidays – a paid day off on a public holiday, except where reasonably requested to work.
Notice of termination and redundancy pay – up to 4 weeks notice of termination (5 weeks if the employee is over 45 and has at least 2 years of continuous service) and up to 16 weeks redundancy pay, both based on length of service.
Provision of a Fair Work Information Statement – employers must provide this statement to all new employees. It contains information about the NES, modern awards, agreement-making, the right to freedom of association, termination of employment, individual flexibility arrangements, right of entry, transfer of business, and the respective roles of Fair Work Australia and the Fair Work Ombudsman.
By the standards of America’s captive slave labor market, these are stunning levels of workers’ rights. There is a single umbrella union that nearly all workers are free to join, although items such as pay and working conditions are left to the governments, rather than collective bargaining between unions and bosses.
There are lower rates for children and teens: those under 16 can be paid as little as $5.87 an hour. At 16 years of age it’s $7.55; it climbs by year to $15.59 by age 20. There are diminishing restrictions on the number of hours each age can work, and in what positions. Apprentices start at $10.22 an hour with a four year graduated scale that takes them up to $17.65. These are minimum wages for children and trainees, mind you. About 40% of Americans don’t make the Australian minimum wage, but have to shoulder health care costs and not get any vacation time or holiday pay.
So how is the Australian economy doing? In 2011, it was doing a lot better than any of the Western economies, with about a 5% unemployment rate, hardly any welfare at all, and a comfortable rate of growth.
Now? Well, the Heritage Foundation, hardly a fan of minimum wage, sees hard times ahead for Australia. They note that Australia’s biggest customer is China, and the Chinese economic bubble is getting ready to pop. In particular, they note that coal makes up 10% of Australia’s exports, and the market for that is dwindling, as countries seek alternative energy sources.
The Heritage Foundation, without mentioning Australia’s minimum wage, concedes that Australia has one of the freest economies on earth, freer than the United States, and that it has one of the most business-friendly economies on earth, behind only Singapore and Hong Kong. This, despite a minimum wage they would damn as ruinous in America, a national union, national health care, and a wide range of benefits including paid vacation time (four weeks!) and holiday pay.
So when the Heritage Foundation calls the raising in minimum wage a job killer, they are lying, and they know they are lying. In fact, their own analysis of the Australian economy—still robust at this point and threatened, not by the minimum wage by by economic slowdowns abroad—shows that the higher minimum wage actually creates jobs, reduces welfare, decreases medical costs, and leads to a healthier and stronger economy.
Of course, outfits like the Heritage Foundation can’t tell the truth at this point; after so many years of telling destructive lies to cheat Americans, if word got out, they might have a revolution on their hands.
It’s something of a wonder that they haven’t already.