Employers who provide early childhood education and care services play a vital role in not only supporting and caring for children, but in facilitating the participation in the workforce of parents, and, in particular of women, Innes Willox, Chief Executive of the national employer association, Ai Group, said today.


"There is real concern across the sector about the disruption that multi-employer bargaining may have and big questions about what role the Government will play in any such negotiations," Mr Willox said.


"While the Government this morning welcomed a proposed application for multi-employer bargaining between unions and a discrete group of employers in the childcare sector, the development has caused understandable anxiety in the broader industry.


"Alarm bells should be ringing for parents who rely on this industry following the announcement of the application.


"Key unions in the sector are reportedly calling for wage increases of 25 per cent.


"The frank reality is that many employers in this sector simply don't have the capacity to absorb or pass on wage increases of that magnitude, particularly when also having to comply with mandatory staff-to-child ratios when providing services.


"Many rely heavily on government subsidies for childcare costs. Many service communities where parents are already struggling with current cost-of-living pressures and simply can't afford to pay more.  
"While the Government seemed to be aware of the developments before any application to bargain was even made to the Commission, there is a real lack of meaningful transparency around any discussions that may be taking place between the Government and the unions or other parties.


"The other big concern is that a deal is going to be struck between a small group of employers which ultimately will result in other employers that have played no part in the negotiations later being 'roped into' the coverage of the agreement.


"The big question that needs to be answered is whether the Government intends to subsidise any wage increases that employers offer in the childcare sector and, crucially, if it is, will this support be provided uniformly across the sector regardless of whether an employer and their workforce want to be a party to a union negotiated multi-employer agreement?


"A major concern for many employers in the sector is that an agreement struck with one group of employers that is not sustainable will unfairly distort the labour market and make it even harder for them to attract and hold staff.


"Nobody begrudges workers in the care economy a pay rise, but employers in these crucial sectors need confidence that wage increases will be sustainable.

"The reality is that the big barrier to many employers bargaining or granting wage increases in this sector, or many other parts of the care economy, has never been inherent employer unwillingness. It has most often simply been their limited capacity to pay.

"In the Disability Sector, which services NDIS participants, employer funding is closely connected to award rates of pay and employers simply aren’t allowed to charge clients more than set limits prescribed by the scheme. That means the level of government support is the real brake on wages.

"If the Government is genuine about wanting employees in the care economy to be paid more, it really needs to be open about its willingness to further fund increases in such sectors.

"It has never needed the radical new multi-employer bargaining laws to achieve this outcome,” Mr Willox said.


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