Sunday and public holiday penalty rates will be reduced for hospitality, retail workers, Fair Work Commission rules

Updated

Sunday and public holiday penalty rates will be reduced for full-time and part-time workers in the hospitality, retail and fast-food industries, the Fair Work Commission has ruled.

Key points: Workers will continue to receive penalties but they will be reduced

Retailers say the decision means they can extend opening hours

Unions say low-paid workers will struggle to make ends meet

The Australian Council of Trade Unions (ACTU) said nearly half a million people, including some of the country's lowest-paid workers, would lose up to $6,000 a year.

The commission said the cuts would lead to increased services and trading hours on public holidays and Sundays.

But it acknowledged the changes would cause hardship to some workers.

"Many of these employees earn just enough to cover weekly living expenses," Fair Work Commission president Iain Ross said.

Sunday pay rates for full-time and part-time hospitality workers will be cut from 175 per cent of their standard wage to 150 per cent.

In retail, Sunday wages will be reduced from 200 per cent of the standard rate to 150 per cent for full-time and part-time staff.

Sunday penalty cuts: Full and part time Casual Retail 200pc down to 150pc 200pc down to 175pc Hospitality 175pc down to 150pc No change Fast-food 150pc down to 125pc 175pc to 150pc Pharmacy 200pc down to 150pc 200pc to 175pc

For fast-food workers, Sunday pay for some full-time and part-time employees — classed as "level one" workers — will be cut from 150 per cent to 125 per cent.

"The immediate implementation of the variations to Sunday penalty rates would inevitably cause some hardship to the employees affected, particularly those who work on Sundays," Justice Ross said.

"We have concluded that appropriate transitional arrangements are necessary to mitigate the hardship caused to employees who work on Sundays.

"We have not reached a concluded view as to the form of those arrangements."

Casual workers in the retail and fast-food industries will also see their pay cut but 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.

Workers will be offered more hours: retailers

Public holiday rates will also be cut for workers in all three industries.

The commission reviewed Saturday rates but decided against any reductions.

Russell Zimmerman from the Australian Retailers Association said he was "very happy" with the result and businesses would now be able to employ more weekend staff.

"There are a lot of retailers who don't open at the moment and it will give them an opportunity to open," he said.

"Those people who believe they are going to be affected may well find, I believe they will find, they will be offered extended hours."

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.

ACTU president Ged Kearney said Prime Minister Malcolm Turnbull needed to intervene or he would "forever be remembered as the Prime Minister who oversaw an attack on the wages of the lowest-paid people in our economy".

"How realistic is it to ask a worker to cut their pay by $6,000 a year?" Ms Kearney said.

"What does that mean when they have to pay rent, pay for a car, pay for a mortgage?

"It will simply mean people whose pay has been cut will have to work more hours, work longer shifts. That is nonsense."

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Labor to challenge Fair Work decision

Opposition Leader Bill Shorten said workers had been "kicked in the guts".

"We are going to do our best to convince the Fair Work Commission not to implement this decision," he said.

"If we are unsuccessful, we will also be changing the law in Parliament to change the rules that the Fair Work Commission operate under.

"I have never seen an argument which would justify wholesale pay cuts for the lowest paid workers in Australia."

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," she said.

"I am very disappointed that the unions and the Labor Party are already indulging in a scare campaign."

Greens MP Adam Bandt said the cuts were a "body blow" to people who relied on penalty rates to make ends meet.

"Coffees won't get any cheaper on Sunday but young people will find it harder to pay the rent," Mr Bandt said.

Topics: government-and-politics, business-economics-and-finance, work, melbourne-3000, vic, australia

First posted