Push for higher wages unjustified: CCI

The Chamber of Commerce and Industry has criticised Unions WA for applying for a 5.5 per cent minimum wage increase WA, saying it is an unjustified and irresponsible claim that could harm businesses still recovering from the GFC.

Unions WA today applied to the Industrial Relations Commissions to increase the WA minimum wage by 5.5%, or $31.33 a week.

CCI raised concern that the increase is excessive and unsustainable for many, especially small businesses.

"WA workers are already the highest paid in the country with a minimum wage of $569.70 per week. That's more than $25 above the Federal Minimum Wage, and more than $8 above the average of all other states," a statement from CCI said.

"A further $31.33 is simply unwarranted and well above the cost of living increases measured by the rate of inflation."

"In 2010 we are seeing a significant increase in the cost of living in WA, driven largely by growth in the resources sector. Minimum wage workers get none of the benefits of wages growth but do have to endure higher costs of living. Anyone paying an electricity bill knows this," Unions WA secretary Simone McGurk said.

"Last year the CCI argued that no increase should be paid, and in fact the industrial commission agreed to delay the increase by three months because of the concern of the GFC," Ms McGurk said.

"We now know that the GFC had very little impact in WA yet minimum rate workers were given a minimal and delayed increase.

"This increase will apply to all employees on award or minimum rates in the state industrial relations system - that is those employed by unincorporated small business.

"The Government estimates that up to 38,500 Western Australians are expected to receive the increase arising from this decision."

CCI said "the imminent return of severe labour shortages has meant businesses have become increasingly worried about the pressure this will place on wages. Small business and those in the services sector are the most concerned - sectors most exposed to excessive increases in the minimum wage."

CCI said it believes the responsible course of act ion is for pay increases to be linked primarily to productivity improvements in the economy, whilst also recognising the need to ensure the real value of the minimum wage is amterially not eroded by cost of living increases.

CCI's submission to the commission has recommended a more moderate minimum wage increase of $12 per week.