The Sunday penalty rate cuts will be phased in over the next four years in a move that angered both employers and unions.
The Fair Work Commission ruled that the reductions to existing penalty rates for fast food, hospitality, retail and pharmacy employees will not take full implementation until 2019-2020.
Fast food and hospitality workers will have Sunday penalty rates cut by 5 per cent next month, and 10 per cent in 2018 and 2019. Their final penalty rate cuts will be 125 per cent and 150 per cent respectively.
Retail and pharmacy workers will take a 5 per cent cut this year, and a further 15 per cent every year until 2020. Their penalty rate cuts will be reduced from 200 per cent to 150 per cent.
Unions argue that the pay cut would devastate workers who sacrificed their weekends to earn money. “I think no matter which way you dress it up, you’re facing pay cuts every single year,” said Australian Council of Trade Unions secretary Sally McManus. “Australian workers are already suffering as a result of stagnant wage growth… They can’t afford a $1.42 billion wage cut.”
On the other hand, employers believe the reductions should be phased in two years instead of four. “Retailers need a break and they need it now,” said National Retail Association chief Dominique Lamb.
Russell Zimmerman, head of the Australian Retailers’ Association, also said the long phase-in period prevents businesses from employing more staff. “What this will do is create an incredible amount of extra work for retailers, who won’t be able to employ more people as quickly as they would like,” he said.
Employment Minister Michaelia Cash said the decision showed the commission’s impartiality. “Nobody got exactly what they wanted. The unions wanted it set aside, employer groups wanted a speedier transition process,” Cash said. “What this does now is give certainty.”
Nevertheless, Cash insisted that the cuts are helpful for small business while impacting only three to four per cent of Australia’s workforce. “The adjustments to Sunday penalty rates will even the playing field for Australia’s small businesses, which have to pay more for staff on Sundays than big businesses who do deals with big unions,” Cash said. “This will help thousands of small businesses open their doors, serve customers and create jobs on Sundays.”