Published on Feb 27, 2017

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The Fair Work Commission has ruled that hospitality, fast food, retail, registered and pharmacy workers will have their Sunday and Public Holiday penalty rates cut.


Who is affected?


The modern awards subject to the reductions are:

  • Fast Food Industry Award 2010 – MA000003
  • General Retail Industry Award 2010 – MA000004
  • Hospitality Industry (General) Award 2010 – MA000009
  • Pharmacy Industry Award 2010 – MA000012
  • Registered and Licensed Clubs Award 2010 – MA000058
  • Restaurant Industry Award 2010 – MA000119

Public Holiday penalty rates were also hit by up to 25% decreases.


The Fair Work Commission assessed the decision against the need to compensate employees for working outside ‘normal hours’.


In making the decision, interestingly the bench felt that the deterrence element of penalty rates, or the need to deter employers from scheduling work outside ‘normal hours’ through penalty rates, was no longer a relevant consideration.


Sunday penalties were not reduced to the same levels as Saturday penalties (except in the Fast Food Award). The reasoning given was that the ‘disutility’ or inconvenience of Sunday work is of a higher level than that of Saturday work. Saturday rates will remain unaffected.


It was noted that penalty rates were to be reduced in the Fast Food Award because it was deemed these employees preferred Sunday work, and it impacted them to a lesser degree.


The conclusion of the bench remains that they feel the proposal will result in positive employment effects including increased employment and business benefits.


The bench also discussed possible staff migrations from casual to part-time employment for many employed in these awards.


The reductions in Sunday penalty rates are proposed to take place in a series of annual adjustments on 1 July each year (commencing 1 July 2017).


View the FairWork Commission’s decision of the 4 yearly review of modern awards or the Summary of the Decision.


What do you think?

  • Will this be a win for small businesses?
  • Will more businesses open on Sundays and Public Holidays?
  • Will the loss to workers be detrimental?

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