A 2.9 per cent boost to Australia's minimum wage is very disappointing, the ACTU says.
The union had called for a $26-a-week increase, but the FWA on Friday awarded the nation's lowest-paid workers a $17.10 weekly pay rise.
ACTU secretary Dave Oliver said the decision raised the spectre of a working poor in Australia.
"What this decision will do is entrench the growing inequality that we have in this country now between real average wage earnings and those that rely on the minimum rate," he told reporters in Melbourne.
"We're concerned that gap is going to continue to grow and could well lead to an underclass and a working poor in this country."
He urged low-paid workers to join a trade union, in order to gain power to fight for higher collective bargaining agreements with their employers.
Professional cleaner Gamal Babiken, 58, says a $17.10 weekly pay rise will do little to ease his struggles to tackle the rising costs of living.
He says he finds himself working harder than ever despite nearing retirement, as he supports his family overseas and tries to put his son through university.
"I have to do more hours to get more income to survive," he said.
"After tax it ends up being around $14, it doesn't help, I don't know what to do with it, really."
United Voice, which represents workers in many industries affected by the wage decision, said the increase was underwhelming for millions of workers across the country.
The union's assistant national secretary Sue Lines said the pay rise barely kept pace with inflation.
"It means no real increase in pay at a time when many families are doing it tough under the constant pressure of a rising cost of living," Ms Lines said in a statement.
Ms Lines said the pay rise would do little to fix the decline in the spending power of low paid workers in industries including aged care, childcare, cleaning, hospitality, security and manufacturing.
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