FWC Rules Cut in Penalty Rates Paid to Hospitality and Retail Workers in Australia

February 24, 20178:19 am475 views

Fair Work Commission Australia issued rules to reduce Sunday and public holiday penalty rates for hospitality and retail workers in the country. According to Australian Council of Trade Unions (ACTU), nearly half a million people including some of the country’s lowest-paid workers will lose up to $6,000 per year.

The Commission said these cuts would lead to increased services and trading hours on public holidays and Sundays. However, “These changes could cause some hardships to workers particularly those who work on Sundays, since many of these employees only earn enough to cover weekly living expenses,” said Fair Work Commission president, Iain Ross.

Sunday pay rates for full-time and part-time hospitality workers will be cut from 175 percent of their standard wage to 150 percent, ABC News reports. In retail, the Sunday wages will be reduced from 200 percent of the standard rate to 150 percent for full-time and part-time staff.

For workers in the fast-food chain, the Sunday pay for part-time and full-time employees classed as “level -1” will be cut from 150 percent to 125 percent.

Ross added, “We have concluded that appropriate transitional arrangements are necessary to mitigate the hardship caused to employees who work on Sundays.” However, the Commission has not yet arrived on a concluded view of the arrangements.

See: Australian Employers Make Active Efforts to Close the Gender Pay Gap

Casual workers in the retail and fast-food industries will also see cut in pay rates, however rates for casuals in hospitality will remain the same. The public holiday penalty cuts will come into effect on 1 July 2017.

The Fair Work Commission has not yet decided when the Sunday rate cuts should come into effect, but indicated it should be within a year. The commission noted there was a higher level of “disutility”, or inconvenience, for employees to work on Sundays than Saturdays, but said it was not as bad as in the past.

Employment Minister Michaelia Cash said the decision would help unemployed people find work. “This will have a positive impact on many of the employers who will now be able to open on a Sunday and offer more employment, in particular to those who are unemployed or underemployed,” Cash added.

Also read: Skills in Demand in Australia for 2017

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