Penalty rates reduction will help to create jobs

23 Feb 2017 |

Today’s decision from Australia’s independent Fair Work Commission delivers important reductions in excessive penalty rates that will help retail and hospitality businesses create more jobs and offer more hours, the Australian Chamber of Commerce and Industry said today.

In a 550-page decision following one of the most extensive evidentiary cases ever heard, the Commission found (paragraph 30) that existing penalty rates are:

  • Restricting trading in shops, pubs and pharmacies;
  • Lowering staffing levels; and
  • Restricting the type and range of services provided to our community.

The Commission found (paragraph 31) that reducing penalty rates in some industries is likely to:

  • Increase trading hours on Sundays and public holidays;
  • Reduce hours being worked by owner operators;
  • Increase the level and range of services offered on Sundays and public holidays; and
  • Increase overall hours worked.

The changes to penalty rates awarded by the Commission will give thousands of small and family-run businesses more capacity and new incentives to hire staff, give more hours to existing staff and increase services, but the benefits would have been greater if the reductions were more significant and more widely applied.

James Pearson, CEO of the Australian Chamber, said: “Employers did not get everything we were seeking, but today’s significant decision makes some important progress in helping these businesses be open when people need them, and in delivering more jobs to more Australians, particularly young people.

“With 725,000 people out of work, including 259,000 young people, we need to make it easier for employers to take on employees – and today’s decision does that.”

  • The business community welcomes the decision to reduce penalties in some industries:
  • Modest reductions in Sunday penalty rates under the hospitality award, retail award and pharmacy award, and part the fast food award.
  • Modest reductions in public holiday penalty rates under the hospitality award, retail award, fast food award and pharmacy award, and part of the restaurant award.

Mr Pearson said: “Australian Chamber members invested significant time and resources into this case. We will continue to seek to repair areas of our workplace relations system that make operating and employing too costly and too difficult.

“Today’s decision is subject to transitional and staggered implementation. The full benefits identified by the Commission may take some time to realise.

“Employers in these industries should seek advice from their employer associations and state and territory chambers of commerce on how to manage the transition.”

AusChamber Media Contact

P  |  0438 730 772

E  |  [email protected]

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