The state's peak employer body says Western Australian businesses will either shed jobs or cut back hours to cope with today's 3.4 per cent national minimum wage increase.
Chamber of Commerce and Industry chief executive James Pearson said the increase would add between $21.28 and $38 per week for workers on federal awards, not the $19.40 being claimed by unions.
"Today's decision by Fair Work Australia is bad news for most small and medium sized employers, as it adds yet another financial burden on their business at a time when they can least afford it," Mr Pearson said.
"Compounding the problem for business is that there are no productivity gains linked to the pay rise.
"It is likely that businesses in the retail, cafes and restaurants sectors, already struggling to maintain employees on their existing hours of work, will be left with no option but to further reduce hours of work."
Mr Pearson said small businesses were already mired in the "slow lane" of the two-speed economy, and were struggling to keep afloat in the face of rising costs and harsh credit conditions.
He said business had sought a $10 to $12 rise, and the ruliung highlighted flaws in the current system for determining the minimum wage.
"WA business is calling for changes to the system. CCI, in a new policy paper released this week, calls for the creation of a new statutory authority to determine the federal minimum wage. An open inquiry would be held annually to determine the minimum wage.
The chamber advocated that any future wage rises should be decided using the following criteria:
- performance and competitiveness of the national economy, including productivity, business competitiveness and viability, inflation and employment growth;
- relative Australian living standards; and
- needs of those receiving federal minimum wages.
