Why the Victorian government wants to raise the minimum wage

Victorians who earn award and minimum wages should get a pay rise, the state government has urged.
Victorians who earn award and minimum wages should get a pay rise, the state government has urged.

Increasing the minimum wage by about $27 per week would help address the gender pay gap and protect Australia's most vulnerable workers, the Victorian government says.

In its submission to the Fair Work Commission's annual wage review, the Andrews Labor government argues the national minimum wage should be bumped up to $19 an hour, the equivalent of about $722 per week.

It currently sits at $18.29 per hour, which equates to $695.02 per 38 hour week, before tax.

The government's submission also highlights an increasing reliance on award wages in Australia.

It says lower award wages are more prevalent in the retail, hospitality and cleaning sectors, and disproportionately affect women, youth and the vulnerable, including Aboriginal and older workers and the disabled.

"The national minimum wage and award minimum wages can play a significant role in helping to address the disadvantages faced by these cohorts," the government says in its 43-page submission.

Victorian Industrial Relations Minister Natalie Hutchins says all workers should be paid fairly, to tackle rising inequality and cost of living pressures.

"This modest, fair increase would provide a critical boost for our community's lowest paid workers, and ensure we do not create an underclass of working poor in Victoria," she said in a statement on Monday.

The Fair Work Commission is responsible for setting the minimum wage for employees in the national workplace relations system, and it conducts a review each financial year.

It increased wages by 3.3 per cent in 2016/17, a weekly increase of $22.20 compared to the previous year.

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- Up to 2.3 million Australians directly rely on minimum wages.

- At May 2016, Victorian women working full time earned about $240 less per week than men.

- Women make up 60 to 70 per cent of workers in lower paid occupations such as clerical and sales.

- In 2015, the median income for a disabled person was $465 per week, less than half the $950 of a person without disability.

- Up to 35 per cent of Australian workers have their wage determined by the commission's annual review.

(Source: The Victorian government's submission to the annual wage review 2017/18)

Australian Associated Press