New Countdown staff would start on the living wage Photo:
Thousands of First Union members employed at Countdown supermarkets have voted to accept a two-year collective agreement that includes wage rises of about 12 percent.
New staff would start on the living wage, and improvements would also be made to pandemic-leave and sick-leave provisions.
The agreement covered about 18,000 workers.
The union's members at retail chain Cotton On also had a new, similar deal that included pay rises starting at 11.5 percent, and a living wage for new staff.
First Union says the move could set the basis for other workplaces to push for more.
"The issue for us now is how do we apply that and take that best practice to the industry as a whole and we're excited about the opportunities Fair Pay Agreements gives for that," acting retail and finance secretary Ben Peterson told Morning Report.
At the moment workers were disadvantaged because more ruthless employers could pay the minimum wage and undercut the good work of the industry, he said.
The Fair Pay Agreements Bill has passed its third reading in Parliament in late October, providing a framework for collective bargaining across occupations - like cleaners, supermarket workers and security guards - rather than just between unions and employers.
"With Fair Pay Agreements we can work with best practice employers to put in place industry standards that will reward the people who are doing well by their workers and provide a mechanism that those people who refuse to follow through on wages that they can afford to give people a decent standard of living, that we've got an avenue that we can target them in a quick and effective way."
The union would still do that work outside of fair pay agreements "but it just takes a lot of time and it's resource intensive".