Remuneration has an important role inside an employment relation, as it materialises the value of work or services performed by an employee. Furthermore, its impact goes on a macroeconomic level as it might influence factors such as employment, poverty, standard of living, inequality, and business efficiency, among others. In order to protect such factors, around 90% of all countries have put in place a legislation regulating a minimum wage -which is the lowermost legal rate that employers may pay to workers- and its use is encouraged by the International Labour Organisation to protect workers (ILO) (International Labour Organization, 2013). The first government enacting a minimum wage was New Zealand in 1984, followed by Australia, who set a precedent about “living wage” in 1907 with the Harvester judgement. In this milestone for industrial relations, the Federal Conciliation and Arbitration through Justice Higgins –the judge on the case- took the power to set a wage that can prove itself as ‘fair and reasonable’ [p.1] (Harvester case, 1907) capable of providing the modicum elements to sustain a family in a civilised society. The rational expressed in this case embodies the view that common law enforces a social fairness element in the employment relation, in order to protect a weak party …show more content…
NMW acts as the minimum floor to start negotiations, improving the efficiency of collective bargaining or private salary policies. This benchmark also helps to understand business competitiveness in terms of attracting and retaining workforce based on its strategy to reward talent. Finally, the higher income security provided by NMW generates a work-life balance dynamic, useful for lone parents for example, as they can reduce their number of hours in order to receive a certain amount of money (Waring & Burgess, 2011) and provide future security as base on Superannuation