The Business Council said demands by the United Workers Union to remove productivity measures from Woolworths' distribution centres, while demanding significant pay increases, is a bad precedent for Australia's future prosperity and economic growth.
Business Council Chief Executive Bran Black said it is fundamental that businesses should be able to measure productivity.
"A more productive economy is vital to ensuring all Australians receive real wage increases and unions should not be in a position to veto the use of productivity measures that help businesses to grow," Mr Black said.
"Six in every seven jobs are created by private businesses, not unions, and we need to ensure workers, economic growth and our success as a nation are not unfairly held hostage by unions who want conflict."
Mr Black said it was disappointing that customers were being impacted by the UWU's dispute, during the start of the busy Christmas period.
"The UWU's reckless behaviour is already impacting the supply chain, and we don't want to see that spread further and result in consumers missing items for Christmas."
Mr Black said it was disappointing the UWU blocked entry for employees wanting to return to the distribution centre given nearly three-quarters (72 per cent) of the workers wanted to return to work.
"The BCA strongly advocates for higher wages, linked to productivity gains, which is the only way to ensure employees receive a sustainable real wage increase and get the benefit of being paid more."
The Shop, Distributive and Allied Employees' Association (SDA) has endorsed an offer from Woolworths Group, presented last week.
