The Business Council says Labor's push to legislate a union policy on penalty rates will only exacerbate cost-of-living pressures, make it harder for businesses to employ and slash job opportunities.
Business Council Chief Executive Bran Black said this ACTU policy lacked economic credibility and would act as an additional hurdle for businesses in the pursuit of increased productivity and real wage growth.
"This is a populist policy, and it's the opposite of what our country needs right now, as it will only entrench the root causes of cost-of-living challenges," Mr Black said.
"In an environment where real wages have declined and productivity has dropped like a stone, our objective should be to restore a sense of balance to industrial relations.
"If wage increases aren't linked to productivity gains, they're inherently inflationary and that means we risk seeing living standards decline further.
"We can't legislate our way to higher living standards unless we're changing the law to actively increase productivity, and this announcement does the opposite."
Mr Black noted businesses want to see higher real wage growth and this objective should be supported with a flexible industrial relations framework fit for a modern economy.
"The legal argument in front of the Fair Work Commission is about employee choice and the capacity for employees and employers to negotiate, and we need more of that if we're serious about real wages growth," Mr Black said.
The BCA also holds concerns about the ACTU's proposal for a wage theft tribunal, which will only create more complexity and make it even harder to navigate workplace laws.
"No one's disputing that employees should be paid properly," Mr Black said.
"When mistakes are made, employers prioritise voluntary rectification and, in any case, there are already multiple avenues for redress available, including through the Fair Work Ombudsman and recent changes to significantly expand the small claims process in the Federal Circuit and Family Court.
"If the Government and unions truly want to reduce wage underpayments they should support simplification of Awards. The workplace relations system is so complex that even the government department responsible for administrating our workplace laws, the Department of Employment and Workforce Relations, underpaid its employees."
