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Wage tussle escalates in post-boom Australia as long-standing deals expire

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Australian wages are growing at their slowest pace on record, Australian Bureau of Statistics data shows, representing less than half the wage growth rate workers enjoyed a decade ago

[SYDNEY] Moves to abruptly unwind boom-time wage hikes in Australia by cancelling agreements and threatening workers with minimum industry pay are unfair, according to the head of a parliamentary committee examining the issue, and could prompt changes to the law.

Several companies operating in Australia including Indian conglomerate and coal mine owner Lanco Infratech, energy retailer AGL, commodity freight operator Aurizon and Exxon Mobil subsidiary Esso have all terminated, or are in the process of terminating, long-standing agreements when they expire.

The pay negotiation tactic has gained momentum with Murdoch University, in Western Australia, last month applying to the country's industrial relations tribunal to terminate a pay agreement.

Once the agreement has been terminated, the companies and workers negotiate under the threat that should a new agreement not be reached, they could be thrust on to the statutory minimum pay in their sector. Employers can, however, give an undertaking to the tribunal that various pay and conditions agreements are not affected.

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Labor Senator Gavin Marshall, who is chairing a parliamentary committee examining the issue, said investigate whether the tactic had broken industrial relations rules and if so, if these rules needed to be tightened. "Whilst I do not want to pre-empt the work of the committee, there has been a recent spate of industrial adventurism by employers that is inconsistent with the principle of workplace fairness," Mr Marshall told Reuters in a statement.

Australian wages are growing at their slowest pace on record, Australian Bureau of Statistics data shows, representing less than half the wage growth rate workers enjoyed a decade ago.

Resources companies that apply to the tribunal to terminate agreements tend to argue that wages, rostering and conditions are hurting operations, with changes needed in order for them to remain competitive. "Our focus is to reach a new agreement so we can deliver secure supply to all consumers in Victoria," said AGL, the operator of the Loy Yang power plant in the Australian southern state.

The emergence of the negotiating tactic comes five years after the peak of a commodity price boom that saw miners, truck drivers and even cleaners earning six-figure incomes.

Grahame McCulloch, general secretary at the National Tertiary Education Union, said a move by Murdoch University to terminate an agreement had been inspired by resources companies. "It's straight out of the resources sector playbook and it's spreading across the economy as a whole," said Mr McCulloch.

That matter is before the country's industrial relations tribunal.

Murdoch University said in a statement that it had been bargaining in good faith. "Our goal is to position the university for growth and success well into the future," the university said.

REUTERS

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