Salaries Update

Interim pay increase – background

In April the PSA applied to the Industrial Relations Commission for a 2.5% salary increase to commence from 1 July 2013. This is the maximum allowed, without trade-offs, under the Government’s unfair wages policy. We remain opposed to this unfair wages policy and continue to campaign against it.

At this point the PSA is fighting to secure the full 2.5% increase including the 0.25% rise in the superannuation guarantee and to ultimately overturn the 2.5% wage cap.

In May the Government suddenly announced its intention to use the Federal Government’s 0.25% increase to the Superannuation Guarantee Contribution (SGC) as an excuse to reduce its pay offer to public sector workers.

PSA wins so Government changes the law

The PSA strongly opposed that position and believes the 0.25% should be carried as an employer cost and not hit employee hip pockets.

We argued this point before the Industrial Relations Commission and won.

In response, the Government immediately moved to change the law.

It introduced a regulation to ensure the salary increase would be discounted by the 0.25%.

It also announced it would appeal the Commission’s decision.

The appeal is the Government’s backup plan in the event the regulation is disallowed by the Legislative Council when it sits again in August.

The PSA and other public sector unions are campaigning to have the regulation voted down.

Government creates wage uncertainty

The Government’s actions have created a great deal of uncertainty for PSA members.

The future hangs on Parliament determining the status of the regulation in August.

If the regulation is disallowed (as we hope) the Government’s appeal against the decision of the Industrial Relations Commission will then commence.

It may be many months before the matter is resolved.

To further complicate matters, the exact pay increase that should be available is unclear.

Reducing the 2.5% by the 0.25% rise in superannuation is not the straight forward equation it seems.

The Government has conceded that the minimum increase our members are entitled to is 2.27%.

That is why the interim increase has been rounded up to 2.27% rather than 2.25%.

SASS & SSS members may be disadvantaged

The Government has also agreed that its decision to discount the salary increase by the rise in the super guarantee puts members of defined benefit super schemes (SSS and SASS) at a disadvantage.

The PSA and other public sector unions are arguing that two salary schedules should be established; one for those in accumulation funds like First State Super and another for members in defined benefit super schemes who do not (at least under the current arrangements) receive the 0.25% increase in super and so should be entitled to the full 2.5% pay rise.

Instead of agreeing to the two salary schedules, the Government advised that they would change the superannuation legislation for the defined benefit schemes to allow the 0.25% to be placed in the now closed State Authorities Non-Contributory Superannuation Scheme (SANCS).

The PSA and other public sector unions are opposed to this approach as it is simply not viable and may actually disadvantage those in defined benefit schemes.

Further, the Government’s proposal will not resolve the issue for members in Federal defined benefit schemes.

Audit Office refuses interim increase

The Audit Office seems determined to drive wages down even further for its staff.

They are the only agency which has not agreed to pay the interim salary increase.

They successfully argued to be separated from the main proceedings before the Industrial Relations Commission and are of the view that the Government’s wages policy does not require them or the Industrial Relations Commission to grant a 2.5% increase in salaries without trade-offs.

The Audit Office believes that they can propose a rise of up to 2.5%.

Accordingly, they are offering a 2.5% increase, minus the super rise of 0.25%, on the condition that the contract hours of work are increased to 37.5 a week as well as reductions in other entitlements.

This approach would set a terrible precedent for wage bargaining right across the public sector, and we are calling on members to closely observe what is happening at the Audit Office. The next date for conciliation of the Audit Office Award, is 13 August, 2013.

Interim pay increase – current position

On Friday 26 July, 2013 the PSA, Unions NSW and a range of other public sector unions, agreed in the Industrial Relations Commission to an interim salary increase of 2.27% to be made to the Public Sector Salaries Award and other related awards.

This is an interim arrangement made so members can receive a pay rise sooner rather than making members wait until all the outstanding issues are resolved. Resolving these issues – including what the final pay increase should be – is likely to take months.

This interim increase, and any other that flows on at the conclusion of this matter, will be back dated to the first pay period on or after 1 July 2013. Members who have retired or left the service on or after the operative date will also get the increase and back pay.

Members may begin to receive the initial increase in the next few weeks.

We agreed to this approach (accepting an interim increase) following written guarantees from the Government that the right of the PSA to continue to seek more for members was not compromised. This includes the right to continue to fight for the full 2.5% available under the Government’s unfair wages policy.

The PSA is vigorously pursuing every avenue on behalf of members. We are also continuing to mount a campaign with other public sector unions against the government’s unfair wages policy and its attacks on jobs and conditions.