Unions will take Sunday penalty rates cut to court

The West Australian, 6 June 2017

Australian wage growth is set to remain at a record low, below the cost of living

Unions have vowed to fight plans to cut Sunday penalty rates for some of the nation’s lowest-paid workers as employers complain they will struggle without a quicker reduction in wages.

The Fair Work Commission outlined yesterday how its contentious decision to reduce penalty rates would be phased in.

Cuts will start next month and take between two and three years to be implemented fully.

Retail and hospitality workers will have their Sunday penalties cut by five percentage points from July 1, with 10 percentage point cuts next year and in 2019.

Staff in the fast food and pharmacy sectors will have their double time Sunday penalties reduced to time-and-a-half between this year and 2020, starting with a cut of five percentage points on July 1.

But planned cuts in general public holiday penalties will not be phased in, with a 25 percentage point reduction across all affected awards still due to start from July 1.

The commission rejected claims from unions that the penalty rate cut was unfair, saying it had to show fairness towards workers and business owners.

However, it also played down suggestions from employers about the number of extra staff that might be given work by the move, saying the reduction in penalty rates would deliver “muted” benefits to the jobs market.

United Voice, representing hospitality workers, said it would challenge the decision in the Federal Court, arguing hundreds of thousands of low-paid workers had been made worse off.

“The system has completely failed the hundreds of thousands of Australians who give up time with their loved ones to work on weekends and public holidays,” national secretary Jo-anne Schofield said.

National Retail Association chief executive Dominique Lamb said while the cuts in penalty rates were positive they would take too long to introduce.

“Retailers need a break and they need it now, as consumers are continuing to tighten their discretionary spending belts,” she said.

Australian Bureau of Statistics figures yesterday showed company gross operating profits grew 40 per cent over the past year, the fastest in 15 years. But wages rose just 0.9 per cent over the same period.

Harley Loffler, who manages a Scarborough cafe, said he loved the industry but the changes would hurt employees.

He said many workers were students and the penalty rates they earned at weekends or on public holidays sustained them through the week.