What penalty cut rates mean for you?

By February 24, 2017Uncategorized

HOSPITALITY and retail workers are in mourning, small business owners are cheering, and a whole lot of us have been left pretty confused after the Fair Work Commission decided to slash Sunday penalty rates.

The FWC handed down its long-awaited decision today that will affect workers, employers, and consumers alike.

If you’re a double-time-loving waiter, a budget-conscious boss or the kind of person who enjoys going out for breakfast on the weekend every once in a while, you need to get across the changes.

WHAT’S ACTUALLY CHANGING?
In a number of industries, workers get paid extra on weekends and public holidays, but not everybody agrees they should.
Retail and business groups have been leading the case to reduce Sunday penalty rates from double time (200 per cent) to time-and-a-half (150 per cent), in line with Saturday penalty rates.

Across hospitality, fast-food, and retail, those rates have been slashed by varying degrees today.
There will also be varying changes to early and late night work
loading for restaurant and fast food workers.

WILL IT AFFECT ME?
The workers who will be hardest hit are those in the retail, hospitality and fast food industries.
Aussie who rely on penalty rates generally earn a relatively low wage.

Australian Council of Trade Unions president Ged Kearney says the cuts are “not acceptable” and that the cuts would have dire consequences for almost 1 million Australian workers and for the economy.

She says the changes are “a pay cut for the lowest paid people in the country”. The ACTU estimates the FWC decision will cost low-paid workers up to $6000 a year.

IF YOU WORK IN HOSPITALITY!
Fulltime and part-time hospitality workers will have Sunday rates slashed from 175 per cent to 150 per cent.
Sunday rates for casuals will remain at 175 per cent.
If you’re on the national minimum wage, $17.70 per hour, an eight-hour Sunday shift would have earnt you about $248.
Under the changes, that drops to $212 — a difference of about $35 for the shift.

For someone earning, say, $30 per hour, the hourly rate would drop from $52.50 to $45. Instead of $420 for an eight-hour shift, they would now get $360. On public holidays, rates have been cut for fulltime and part-time workers have also been cut from 250 per cent to 225 per cent. Casuals will remain at 250 per cent for public holidays.

IF YOU WORK IN FAST FOOD!
Fulltime and part-time level one fast-food workers will have Sunday penalty rates reduced from 150 per cent to 125 per cent.
Level two and three employees will stay at 150 per cent.

IF YOU WORK IN RETAIL!
Fulltime and part-time retail workers will have Sunday rates reduced from 200 per cent to 150 per cent, while casuals will be reduced from 200 per cent to 175 per cent. As in hospitality, fulltime and part-time retail workers have been cut from 250 per cent to 225 per cent, but casuals will remain at 250 per cent.

IF YOU WORK IN PHARMACY!
Sunday rates for pharmacy workers between 7am and 9pm will be reduced from 200 per cent to 150 per cent for fulltime and part-time workers. Casuals will be reduced from 200 per cent to 175 per cent.

IF YOU’RE AN EMPLOYER!
Employers in these industries are the ones who have been pushing for these cuts. They say the penalty rates have hindered their business by making it too expensive to operate efficiently on the days that demand extra pay.
Businesses argue that, ultimately, this change means more jobs for Australians because they will be able to afford to give workers more shifts.

IF YOU’RE A CONSUMER!
Could this be the end of public holiday surcharges? If restaurant and cafe workers are being paid less surely we shouldn’t have to charge more to cover their inflated wages on those days, right?
Wrong, according to Restaurant and Catering Australia chief executive officer John Hart.

Mr Hart says the restaurant industry is still waiting on a decision to change their award, and even if Sunday and public holiday rates were further lowered, they would still not meet the costs of staffing.
“To be honest, the rates going down won’t alleviate the need for a surcharge on public holidays,” he told news.com.au.
“At 225 per cent you’re still paying more than double time. As it stands at the moment, wages are nearly 50 per cent of turnover. Even with these changes you’re still in a place where there is an extraordinary amount of addition cost, which isn’t met by any sort of surcharge.”

WHY IS THIS HAPPENING NOW?
The reform was one of a number of workplace recommendations made by the Productivity Commission last year. The FWC had been considering bids from business and employer groups to lower Sunday rates since 2015.
A decision was expected at the end of last year but repeatedly delayed.

WHEN DO THE CHANGES KICK IN?
It not clear when the Sunday pay rate cuts take effect. However, we know that the changes to public holiday rates begin on July 1.
Early and late night work loadings in the restaurant and fast food awards will take effect in late March

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