Customers could end up paying more for goods and services if industrial relations reforms on the table are not designed correctly.
On the flip side, well-crafted changes to multisector bargaining and other industrial relations reforms could unlock higher wages for workers.
An independent Productivity Commission report says such industrial relations reforms could make it easier for small firms to band together and secure higher wages but that "would depend very much on its design features".
Changes to multi-employer bargaining rules, which could see workers in small businesses united under similar workplace conditions, were flagged in the wake of the Labor government's jobs and skills summit.
In a report on the labour market, the Productivity Commission warned that poorly designed multi-employer bargaining changes could shrink the productivity benefits of firm-level bargaining.
The authors were also concerned it could encourage cost collusion among businesses and lead to higher-priced goods and services for customers.
But on the other hand, the PC recognised that well-designed changes could make it easier for small firms to engage in bargaining as they could join forces and share the costs.
Australian Council of Trade Unions secretary Sally McManus said the PC was a "politicised relic" of the coalition government that had been tasked with attacking workers' rights.
"They have no idea how wages bargaining works, do not consult and ignore international research. No credibility," Ms McManus said.
But some business groups have echoed the PC's concerns about multisector bargaining.
"No one wants to return to the uncertainty and disruption of a workplace relations system that saps productivity by stoking conflict and strike action, that's bad for workers, bad for consumers and bad for businesses," Business Council chief executive Jennifer Westacott said.
"The best way to get wages growing is by reinvigorating bargaining at an enterprise level to drive productivity," she said.
The report also recommended limiting the better off overall test to make the enterprise bargaining system more efficient.
The PC also waded into gig worker rights and raised concerns that categorising platform workers as employees "would remove key benefits to both efficiency and flexibility for workers".
"Many platform-based occupations are a direct extension of existing independent contracting arrangements, which can involve relatively high rates of pay," the report said.
In a win for low-paid workers, more than 400,000 Australian workers will see a boost to their pay slips after a major decision by the industrial umpire.
Affected full-time workers will receive an extra $40 a week after the Fair Work Commission increased the minimum wage and some associated industrial awards.
The cash is starting to hit bank accounts in the first pay cycle since the 4.6 per cent increase.
