This decision entrenches junior rates for all workers under twenty-one years of age. A small number of eighteen-, nineteen-, and twenty-year-old workers who have been at the same employer for more than six months will benefit from higher rates. However, even this seemingly positive development favors employers.

Let’s say an eighteen-year-old worker has staffed the checkout at an IGA supermarket for four years. If they take the same job at rival supermarket Woolworths, their wage will be up to 30 percent lower just because of their age.

The six-month rule will in practice function as handcuffs tying young workers to their boss. It will cause young workers to be more fearful of their employer and less likely to agitate. Employers will use it to threaten workers not to organize. It will discourage young workers from seeking safer workplaces elsewhere or taking up education opportunities in different cities.

Retail employers are also adept at deploying strategies to avoid those costs in the first place.

This group of eighteen- to nineteen-year-olds, however, is small compared to the vast majority of teenage workers who will continue to be subjected to a process known as “learn or churn.” This means as they age, they either become managers or are de-rostered. This process was alluded to euphemistically during the junior-rates hearing. The Australian Chamber of Commerce and Industry (ACCI) argued to the FWC that young workers “exhibit higher turnover rates than older employees.” This high turnover claim was echoed by the Pharmacy Guild retailers, Red Rooster, and other big employers.

In response to the junior-rates announcement this week, the Australian Retail Council chief executive Chris Rodwell suggested that rather than a cost-of-living crisis, there is a “cost-of-doing-business” crisis. In his view, it’s not workers suffering but retailers struggling with fuel and rent increases.

The ACCI chief executive Andrew McKellar said the changes around junior rates was the FWC “shooting themselves in the foot.” The Australian Industry Group’s Innes Willox argued that employers “simply don’t have endless capacity to absorb these kinds of dramatic cost increases without adverse consequences.”

This is all theater. There are no dramatic cost increases. Any modest cost increases will be offset by employers turbocharging the age-based churning systems they already deploy.

Coles and Woolworths, for example, all employ young people and casual workers at disproportionately higher rates. Notoriously, McDonald’s keeps 85 percent of its workforce in casual employment. This is not an accident: mass casualization enables these employers to de-roster employees as they get older and cost more.

In addition to casualization, many employers, including Kmart and McDonald’s, use sophisticated rostering tools to always favor a younger employee wherever possible.

These types of systems distort the job security of all workers in retail and fast food. They are also what ensures these supermarkets, retailers and fast-food giants keep making eye-watering profits.

Australia added age-based discrimination to prohibited forms of discrimination in employment in 1989. International law clearly prohibits discriminatory junior rates. So how exactly do retail and fast-food employers justify them?

Employers argue that junior rates help children and young people find and secure employment because they make it more profitable for employers to hire them. The Australian Retail Council’s Rodwell stated this very clearly in response to the recent decision when he argued that “junior pay structures have long provided a balanced pathway that supports both youth employment and business viability.”

Junior rates may indeed be quite profitable, but the evidence shows that they actually negatively distort job security for young people. This distortion impacts all workers both at specific companies and across entire sectors.

Junior rates cause employers to deliberately favor cheaper labor. To celebrate the birthday of a child in retail or fast food, an employer cuts their hours. What clearer example of capitalist exploitation and insecurity could there be?

The ACCI argues that junior rates “support, rather than undermine, opportunities for young people to enter the job market.” This is a misleading, narrow definition of “opportunities.” A recent study found that 57 percent of early school leavers did so because they either had a job or were trying to get one. Without junior rates, a young person could work around 40 percent of the hours they currently work for the same income. This would remove pressure to abandon their education. It would also allow them access to the myriad opportunities gained by spending more time in school, in community activities, and with their friends and families.

The beneficiaries of child labor have posed bogus arguments like these for centuries. In reality, these employers don’t celebrate security or opportunity. They value the vulnerability and insecurity that make children less likely to raise safety concerns, complain, or make demands.

To the extent that children are provided an opportunity to learn work skills and share in the community of the workplace, they ought to be fairly rewarded by equal pay for equal work.

The trade union that brought the junior-rates case before the FWC, the Shop, Distributive and Allied Employees’ Association (SDA), played the role of junior rates’ greatest defender. It argued to the commission that a sixteen-year-old worker at KFC, Woolworths, or Kmart is only worth 50 percent of an adult wage. This argument was influential: the commission concurred “that minors’ work value was likely less, having regard to factors relating to maturity, life experience, and opportunity to have obtained work experience.”

But it’s worth examining why the SDA is playing this negative role. The union has a close working relationship with Australia’s two biggest supermarkets, Woolworths and Coles. About half of the SDA membership is at Woolworths and about one quarter is at Coles. This means the SDA’s existence is more or less entirely reliant on only two employers.

The SDA negotiates enterprise agreements that ensure lower wages for workers and continued profits for Woolworths and Coles. In return for these sweetheart deals, these companies allow and assist the SDA to recruit young workers.

SDA recruitment agents are permitted to interrupt workers, target them on their first shift, interrogate children without parents present, process payroll deductions, and more. Until 2018, SDA even gave 10 percent of the membership fees paid by workers to these two employers as recruitment commissions.

Without this kind of assistance from the bosses, SDA membership would plummet. This is because the SDA doesn’t actually achieve anything for its members. Notoriously, the SDA helped a range of big employers across retail and fast food steal billions of dollars from workers.

But the true value for Woolworths and Coles is in the SDA’s political affiliation. The SDA is the largest trade union affiliate to the Australian Labor Party (ALP). The close relationship between the SDA and the supermarket giants means the ALP has steadfastly refused to support greater regulatory powers against the duopoly to force divestment or other pro-consumer actions.

The largest employers, particularly Woolworths and Coles, secure far greater returns from the SDA than these recent, modest changes to junior rates will cost them.

The FWC’s ruling makes it clear that young workers can’t rely on the courts to abolish discriminatory wages. If junior rates — and the yellow unions and sellout deals that have allowed them to endure — are to be genuinely abolished, huge numbers of workers will need to mobilize. That momentum has begun.

The Retail and Fast Food Workers Union (RAFFWU) launched in 2016 in response to the dire pay and conditions facing workers of all ages in fast food and retail. Over the past decade it has helped return over a billion dollars a year in stolen minimum wages by abolishing or replacing SDA-negotiated enterprise agreements. RAFFWU also made headlines by exposing the SDA’s predatory recruitment practices aimed at young workers.

More than legal cases and media coverage, however, it has implemented a strategy of industrial militancy. In 2021, RAFFWU members held the first retail strikes in Australian history at a Sydney bookstore. Members at Apple stores in Brisbane and Newcastle went on strike in 2022. And workers at Woolworths and Coles supermarkets across the nation took coordinated strike action in 2023.

The deals resulting from these actions have deliver far better outcomes for retail workers than the historic and recent agreements negotiated by the SDA. As prices continue to rise for working people, these battles will become more essential.

Coles and Woolworths are predicted to make AUS $1.02 and $1.33 billion in profits, respectively, in the year ahead. Australia should not be staffing its supermarkets with underpaid children for them to do so. As Coles’s RAFFWU delegate Nelio Da Silva put it, “Big companies like Coles and Woolworths are making a bucketload and not sharing it around. People are starting to realize the bigger picture: we aren’t getting what we should be getting.”