A proposal to hike apprentice wages by a third threatens the viability of apprenticeships within the building and construction industry in Australia and should be rejected, a building industry association group says.
Master Builders Australia says the proposal, put forth by the Construction, Forestry, Mining and Energy Union (CFMEU), to lift minimum apprentice wages by 33 per cent will make engaging apprentices unaffordable to many small employers.
“Master Builders strongly supports reforms to improve building trade apprentice retention rates, but the CFMEU’s claim to dramatically increase wages and restrict the work apprentices can undertake presents a significant cost risk for employers and the apprenticeship system,” says Master Builders chief executive officer Wilhelm Harnisch. “The apprenticeship system is a valuable tool to teach people the skills required to succeed in the building industry. It’s an important learning process that has to be done through formal training and on site education, which is costly.”
The statement comes as a tribunal of Fair Work Australia is set to hear arguments on Friday about changes to the system suggested by the CFMEU. The union says low rates of pay have made completing an apprenticeship unaffordable, and have proposed a 10-point plan to improve the system.
In addition to improved wages, the union wants training quotas on government funded projects, industry training funds across all states, shorter apprenticeships in some circumstances, auditing of training providers and identification of skill gaps.
The union movement has long argued that higher wages are necessary to support mature-age apprentices – a growing proportion of trainees who generally have heavier personal financial commitments than those starting out in their careers.
Unions argue that a failure to attract mature-aged participants into the apprentice system will further worsen skills shortages across the economy, including in building and construction.
While Harnisch acknowledges the financial pressures on apprentices during their training period, he says that apprentices getting paid to learn their trade are in a more favourable position than university students, who pay thousands of dollars for their education and do not receive any payments until they start working.
Harnisch also says the union’s claim fails to recognise the commercial reality in light of the downturn currently facing building and construction.
“The approach taken by the CFMEU reflects a complete lack of commercial understanding and the challenges facing employers,” he says. “To seek a dramatic increase in apprentice wages and limit the tasks they can complete is commercially irresponsible and will compound the current problems facing the apprenticeship system.”
In addition to arguing against the CMFEU proposals on merit, Harnisch says Master Builders will argue that many of the union’s proposed changes are beyond the jurisdiction of the Fair Work Australia tribunal.