Wage-setting outcomes

The AWRS has collected a range of information that can be used to examine differences in earnings between characteristics of employees, such as gender.

Data can be disaggregated to identify employees’ occupations, weekly and hourly earnings, and components of earnings such as overtime, bonuses and superannuation. An employee’s status as a junior, casual or part-time worker can also be controlled for.

Care should be taken when comparing AWRS survey estimates based on ANZSCO groups with estimates from the ABS using the EEH classification of 'managerial' employees. A variable classifying employees according to the ABS definitions of 'managerial' and 'non-managerial' is not included in the AWRS survey.

Table 5.12 shows average hourly ordinary time cash earnings (AHOTCE) for female adult non-casual, non-managerial employees was 83% of AHOTCE of all male adult non-casual, non-managerial employees. AHOTCE for females was $36.91 (per hour), compared with $40.65 for males.

The AHOTCE of all award-reliant female adult non-casual, non-managerial employees was 92% of the AHOTCE of all award-reliant male adult non-casual, non-managerial employees.

Table 5.12: Average hourly ordinary time cash earnings (AHOTCE) for non-casual employees, by method of setting pay & ratio of female to male earnings
	Female ($)	Male ($)	Ratio of female to male
Non-managerial employees	42.36	51.20	0.83
Negotiated amount with my employer	47.98	57.58	0.83
By an enterprise agreement	44.12	43.53	1.01
By an award	32.77	35.54	0.92
Market rate (more than the award/standard rate)	41.49	50.45	0.82
All employees	44.43	55.79	0.80
Negotiated amount with my employer	51.21	63.49	0.81
By an enterprise agreement	45.26	45.14	1.00
By an award	33.09	36.11	0.92
Market rate (more than the award/standard rate)	42.46	51.55	0.82

Source: AWRS 2014, Employee survey.

Base = 4128 non-managerial employees and 5090 employees in total. Excludes persons aged below 21 years. Also excludes persons employed under an apprenticeship or traineeship and persons who reported hourly earnings in the top and bottom 5% of the hourly earnings distribution.

Note: Hourly wage rates are calculated using employees’ reported standard hours earnings in the last pay period. Respondents who did not receive remuneration for standard hours (a base salary) are excluded.

For the purposes of this table, non-managerial employees are those classified to ANZSCO categories other than the ANZSCO Note: 1-digit group Managers.

As demonstrated in Table 5.12, there are differences in the earnings of employees according to the different methods of pay-setting. Employees who have their pay set by an enterprise agreement, on average, have higher earnings than employees who have their pay set by an award.

The AWRS collected information from enterprises about how the wage rates in enterprise agreements were determined and how they compared to the relevant awards. There is limited data available which reports on the extent to which modern awards may influence wage-setting arrangements and outcomes for enterprise agreements.^[1]

The analysis presented in Table 5.13 shows that more than half (59%) of enterprises with enterprise agreements in place used pay structures that set rates of pay well above award rates. Just over one-quarter (27%) indicated that the enterprise agreement wage rates sat just above the applicable award wage rates. Few (9%) enterprises reported that the agreement rates replicated the award rates.

Table 5.13: Enterprise agreement pay setting structures compared to awards by industry, per cent of enterprises with an enterprise agreement in place
Industry	Replicate award wage rates (%)	Sit just above the award wage rates (%)	Sit well above award wage rates (%)	Enterprise agreement wages have not been compared to award(s) (%)	Other (%)	Unsure (%)
Mining	0.0	6.6	84.4	6.8	0.0	2.2
Manufacturing	4.7	24.9	70.6	1.2	0.7	0.7
Construction	3.6	17.8	74.0	0.5	0.0	4.1
Wholesale trade	2.8	14.2	69.6	0.0	0.0	13.3
Retail trade	27.4	30.9	28.1	0.0	11.1	0.0
Accommodation and food services	13.1	42.7	33.7	1.1	1.1	7.7
Transport, postal and warehousing	5.3	34.2	58.9	1.9	1.1	1.9
Rental, hiring and real estate services	15.1	39.3	75.8	0.0	0.0	0.0
Professional, scientific and technical services	8.3	8.3	83.5	0.0	0.0	0.0
Administrative and support services	13.7	27.3	45.9	0.0	3.1	6.2
Education and training	12.2	24.6	54.3	1.0	0.0	7.1
Health care and social assistance	21.8	42.9	34.4	0.9	0.9	0.9
Arts and recreation services	7.1	40.3	44.4	0.0	0.0	8.2
Other services	2.2	37.3	44.0	14.2	0.0	4.5
All industries	9.1	27.3	58.8	1.3	1.1	3.7

Source: AWRS 2014, Employee Relations survey.

Base = 812 enterprises.

^[1] However note research published by the Commission in 2013, namely: Buchanan, J, Bretherton, T, Frino, B, Jakubauskas, M, Schutz, J, Verma, G, Yu, S (2013), Minimum wages and their role in the process and incentives to bargain, Research Report No. 7/2013, December, Fair Work Commission, Melbourne.
Healy J, McDonald I, Macaitis K, Mavromaras K and Sloane P (2011), Research Framework and Data Strategy, Research Report 4/2011, Fair Work Australia, Melbourne.