If you're in need of a coffee or some retail therapy on New Year's Day, don't be surprised to find that many businesses have decided to take the day off with you.

The first day of 2019 is considered a public holiday in every state of Australia, meaning penalty rates apply to full time, part time and casual workers across a range of awards.

Dumbo owner Liam Thorneycroft says having crunched the numbers, it's a better choice not to open his business on New Year's Day. Credit:Josh Robenstone.

This is the second year that business owners across the food and retail sectors have been able to pay lower New Year's Day rates after the Fair Work Commission decided to adjust loadings in 2016. On Tuesday, employers will have to ensure they deliver between 225 per cent and 250 per cent of their worker's base wages to cover off their obligations across a range of awards.

For a casual retail worker, this means the hourly rate will start at $51.63.