Fair Work Commission Junior Rates end: a win for younger workers and a strain for retailers
Inside the fluorescent hum of a retail shop, a quiet recalibration is under way: the rule that paid many 18- to 20-year-olds less than their older colleagues is being dismantled. The Fair Work Commission’s move on fair work commission junior rates will see 18- to 20-year-old employees in retail, fast-food and pharmacy roles move toward full award wages.
Fair Work Commission Junior Rates: what changes and who benefits?
The commission has decided that employees aged from 18 to 20 should receive the full award wage for their jobs, abolishing the discounted tier that previously applied to young adults in the specified industries. Under the prior arrangement, wages were fixed at 70 per cent of the full award for 18-year-olds, rising to 80 per cent at 19 and 90 per cent at 20. Junior wages will remain in place for minors.
The change will be phased in over a four-year period from December, with the commission specifying that there will be no changes for 18- to 20-year-olds who have less than six months of experience at their current workplaces. The ruling reflects a shift in how the commission weighs labour market disadvantages faced by young adults in those sectors.
Why did the commission change the rules?
The commission took into account factors described as labour market disadvantages for young people when deciding to remove the discounted pay tiers for young adults. The decision was framed as correcting an unfairness for workers over 18 in the affected industries while providing a sensible phasing period for businesses to adjust to the new arrangements.
For many advocates, the ruling is more than a technical adjustment: it is treated as a recognition that young adults encounter the same cost pressures as older workers and should not be treated as second-class employees because of their age.
How are unions, government and business responding?
Gerard Dwyer, national secretary of the Shop, Distributive and Allied Employees Association, hailed the decision as long overdue, calling it “a landmark decision, up there with the introduction of equal pay for women in the 1970s. ” He said young adults’ work is as valuable as anyone else’s and that their expenses do not shrink because of their age.
Treasurer Jim Chalmers described the outcome as a great result for fairness in wages, saying the decision helps ensure Australians get fair, decent wages and recognises an unfairness for younger workers while allowing a sensible phasing-in period for businesses.
Business groups criticised the commission’s decision, warning it would pass on significant costs to retailers at a time of broadly higher expenses. Those concerns focus on the short- and medium-term financial pressure that a staged move to full award wages could place on businesses operating with thin margins.
The commission said there would be no change for employees aged 18 to 20 with less than six months at their current workplace, a concession intended to ease transition for employers and some new hires as the phased increase begins.
Where this leaves young workers and employers
For young adults in retail, fast food and pharmacy roles, the ruling promises a path to full award wages rather than tiered discounts; for employers, it signals an extended period of adjustment as increases are phased in over four years from December. The decision frames the change as balancing fairness for workers with a transitional approach for businesses.
Back at the shop floor, the practical meaning of the commission’s ruling will be measured in pay packets and budgeting conversations — and in whether the phase-in period eases pressure on employers while delivering its intended lift for young workers. The policy on fair work commission junior rates closes a chapter on discounted pay for many young adults, even as questions about cost and implementation remain.
