A New Front in the Apprenticeship Pay Debate
Australia’s apprenticeship system is facing a major test as group training organisations (GTOs) push back against a union-led bid that could overhaul how apprentices are paid and employed nationwide.
The Communications, Electrical and Plumbing Union (CEPU) has applied under the Fair Work Act to compel eight South Australian GTOs to enter multi-employer bargaining, a move that would see around 1,000 electrical and plumbing apprentices covered under a single pay agreement.
While the union says the push aims to lift some of the lowest wages in the construction industry, GTOs and employer associations warn the changes could cripple a system that has underpinned training and workforce development for more than 30 years.
“Apprentices Can’t Afford to Work”
CEPU SA State Secretary John Adley said the application reflects a broader concern about the financial strain on apprentices trying to complete their training.
“We’ve got a situation where apprentices can’t afford to go to work as they can’t afford to put petrol in the car,” he said.
“Unless apprentices have family support, they can’t afford the four years it takes to complete an apprenticeship.”
Most GTOs currently pay apprentices close to the award minimum, around $15.67 an hour for a first-year worker, well below the national minimum wage of $24.95.
The CEPU hopes a multi-employer agreement will lift these base rates to reflect “real-world” living costs and encourage more young people to take up trades. “Apprentices have no industrial strength or bargaining ability,” Adley said. “We want to change that.”
Industry Alarm: “It Could Cost $100,000 Per Apprentice”
Employer groups, however, are warning that such a shift could unravel the GTO model entirely.
Larry Moore, Executive Director of the National Electrical and Communications Association (NECA) in South Australia, said the proposed pay increases were “outrageous” and would have devastating financial consequences.
“It will seriously jeopardise the ongoing operation of GTOs,” Moore said. “Over the four-year period, the increase would be $100,000 for each apprentice.”
He added that the CEPU also wanted severance pay applied to fixed-term apprenticeship contracts, a condition that, he argued, “makes no sense.”
Moore said if costs continue to rise, many employers will bypass GTOs and hire apprentices directly. That could hurt completion rates, which GTOs have historically excelled at supporting. NECA’s training arm, Electro Careers, boasts a 98% completion rate, compared with an industry average of around 55%.
The Broader Stakes: How Far Could It Spread?
In South Australia, GTOs employ roughly a quarter of all apprentices, the highest proportion of any state. If the Fair Work Commission grants the CEPU’s application, the move could easily spread nationwide, reshaping how training is managed in electrical, plumbing and building trades.
The union has lodged its case under the supported bargaining stream of the Albanese Government’s multi-employer bargaining laws, which allows groups of employers to be drawn into negotiations without requiring majority worker support, a key departure from traditional enterprise bargaining.
Targeted organisations include:
- PEER
- NECA’s Electro Careers and Apprenticeships
- Australian Industry Group Apprentice and Trainee Centre
- Frontline Human Resources
- Adelaide Training & Employment Centre
- Trainee & Apprentice Placement Service (TAPS)
- Statewide Group Training
- Raw Recruitment and Training
If the CEPU succeeds, it would mark the first large-scale application of the new bargaining framework in the training sector.
Employer Groups Call It “Overreach”
Ai Group CEO Innes Willox said the application highlighted flaws in the multi-employer system and warned that it risked undermining apprenticeship creation.
“It’s blatant and problematic overreach,” Willox said. “The vague parameters of the new multi-bargaining laws have left them open to being used much more widely than was ever envisaged.”
He argued that GTOs play a critical role in helping employers, particularly small contractors take on apprentices without the administrative burden or long-term financial risk.
“If these costs are imposed, it could reduce the ability of GTOs to place apprentices with host employers, cutting off opportunities for young people to get into the trades.”
“We’ll Work Collaboratively” Some Hope for Dialogue
Not all training organisations are taking a combative stance.
PEER CEO Brian Rungie whose organisation has CEPU representation on its board said it was too early to make judgments but that collaboration was key.
“We’ll work collaboratively with the union,” he said.
Rungie noted that PEER’s existing enterprise agreement with the CEPU had recently expired, and that both parties were already preparing to return to the table.
Adley confirmed that the union would pursue both the enterprise and multi-employer bargaining paths “until one of them is closed.”
The Union’s Argument: “You Can’t Train for Net Zero on Poverty Wages”
Adley rejected the idea that higher wages would bankrupt training providers.
“The cost differential is minimal,” he said. “It’s not going to lead to GTOs going broke.”
He added that one of the biggest barriers to meeting Australia’s net-zero construction goals is the inability to retain apprentices.
“What’s the cost of not delivering on net-zero projects because we can’t find people to fill them?”
According to the CEPU, many apprentices leave the trade simply because they cannot survive financially, a trend that exacerbates the national skills shortage and slows progress on renewable energy, housing, and infrastructure delivery.
What It Means for Builders
For builders, the outcome of this dispute could have ripple effects across the entire construction sector. GTOs are key suppliers of skilled labour especially on large-scale projects where consistency, compliance, and mentoring matter.
If group training becomes unviable, builders may face tighter labour markets, higher subcontractor rates, and less oversight of apprentice development. On the other hand, higher apprentice pay could attract more young people into the trades, addressing chronic shortages that have plagued housing delivery timelines.
The decision, expected to be closely watched by state governments and employer associations nationwide, could ultimately reshape how Australia balances training, affordability, and workforce sustainability.
A Turning Point for Apprenticeships
At its core, the dispute highlights a broader national challenge: how to make the apprenticeship pathway viable for workers while keeping training accessible for employers.
Both sides agree that apprentices are struggling but disagree on who should bear the cost.
Whether the Fair Work Commission sides with the union or the training bodies, the outcome could set a national precedent for how the next generation of tradies is trained, paid, and retained.
For an industry already stretched by skills shortages, housing targets, and economic pressure, the stakes could not be higher.
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