Unions are stepping up pressure on the Turnbull government over its youth internship program, saying employing a worker on $3.22 an hour will put another young person out of a job.
But employers say the PaTH program is a practical plan to help address youth unemployment.
Senior Turnbull government ministers are hitting the hustings to promote the program which began on April 1.
The program, announced in the 2016/17 budget, seeks to encourage jobseekers under 25 to do four-week to 12-week internships by paying them $200 a fortnight on top of income support payments and giving the employer a $1000 upfront payment.
Treasurer Scott Morrison says it's about businesses working with young people and the community so youths can get and keep a job.
ACTU secretary Sally McManus says it will undermine jobs.
"If employers can legally employ people on $3.22 an hour and the government pays, why would they hire a young person on the minimum wage?" she said.
Business Council chief Jennifer Westacott said the scheme would give young people practical work experience and the support and skills to stay in work.
Labor spokesman Ed Husic said the 30,000 subsidised interns would be forced into a weak labour market already suffering from record high under-employment and record low wages growth.
The program is being rolled out even though parliament has not passed the legislation.
The legislation is needed to ensure the $200 payment, which comes on top of a young job seeker's social security payments, is not taxed as income for work.
It will also mean anyone who drops out of the program for whatever reason can have their social security payments restored without having to make a new claim.
© AAP 2017
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