What do AWAs really pay?

In 2006 men on median AWA earnings earned 15.4 per cent less than men on median CA earnings. The median earnings for female non-managerial employees on AWAs was 18.7 per cent lower than corresponding median for females on CAs.

Advocates of WorkChoices have repeatedly stated that employees on AWAs earn twice as much as people on awards. Yet median hourly earnings for AWA employees were only 16 per cent above median award-only earnings. For women, median AWA earnings were only 5.6 per cent above median award-only earnings.

Median earnings of non-managerial workers on AWAs grew by 7.9 per cent between 2004 and 2006. This was less than the 9.9 per cent growth in median earnings of workers on CAs over the same period.

Firm size

We found a very stark relationship between firm size and the earnings ratio. In organisations with less than 500 employees, AWAs pay less than CAs. The wage shortfall widens as organisations get smaller. Hence the shortfall is 3.5 per cent among organisations with 100-499 employees, rises to 12.4 per cent in organisations with 50-99 employees, 13.6 per cent in organisations with 20-49 employees and is a very substantial 26.3 per cent in organisations with less than 20 employees.

Among large organisations with more than 1,000 employees (the majority of whom are covered by collective agreements), there is a wage premium for AWAs of 30.8 per cent.

Industry

AWA employees in the majority of industries received a lower average hourly rate than their counterparts did on CAs.

The industry with the highest average wage premium for AWAs (worth 50 per cent) was communication services, the second highest premium was in government administration and defence (33 per cent) and the third highest premium was in finance and insurance (22 per cent). These are all industries with well documented efforts by at least some organisations to use AWAs to reduce union influence, where employees in the more highly remunerated parts of an organisation are hired on individual contracts.

In mining, however, AWA employees earned 3.6 per cent less than CA workers.

AWAs paid on average well below CAs in manufacturing, construction, transport and storage, health and community services; property and business services; and “personal and other services”.

Occupation

For the top three occupational groups, AWA employees earn more on average than CA employees. Professionals are clearly a group with high labour market power.

At the other end of the labour market, labourers and related workers experienced a consistent AWA pay shortfall - their wages were 17 per cent lower than wages of workers on CAs. In all, five of the six lowest occupational groups revealed an AWA pay shortfall compared to CAs.

The most disadvantaged group appeared to be female labourers and related workers - those on AWAs were paid 26 per cent less than similar women on CAs. Indeed, female labourers and related workers on AWAs were receiving 20 per cent less even than the award-reliant average for that occupation.