Stutch has a solid column in The Oz today:
"The big change in yesterday's FWA decision was to break the tradition of awarding flat dollar pay increases, which have concentrated the gains at the bottom end of the pay scale. Instead, the 3.4 per cent rise applies right up the award pay scale. The institutional purpose is to reassert the "relevance" of the industrial tribunal's "modernised" award system. This means the 3.4 per cent pay rise is more likely to become the floor to the mining boom wage bargaining round. And this collective bargaining floor is less likely to require productivity trade-offs. So yesterday's decision reveals a key institutional difference between mining booms mark one and two. Before the financial crisis, Howard's Fair Pay Commission sought to limit real increases in Australia's minimum wage floor and increase the incentive for productivity bargaining. After the crisis, Gillard's FWA is aiming to lift what already is one of the world's highest minimum wage floors. And it is seeking to impose a reinforced award system. This blunt wages policy threatens to more readily transmit mining boom wage pressures to the rest of the economy. And that will put more pressure on the Reserve Bank's blunt interest rate weapon to contain the inflation fallout"
