Fair Work Commission makes changes to penalty rates

Fair Work Commission makes changes to penalty rates
The
Fair Work Commission has ruled that the full extent of the cuts to Sunday penalty rates for fast food, hospitality, retail and pharmacy employees will not take effect until 2020.

However, cuts of only 5% will begin this year on July 1 for the aforementioned industries, with greater cuts scheduled in 2018, 2019 for fast food and hospitality employees.

Moreover, public holiday penalty rates will fall by 25% from July 1 for fast food, hospitality, restaurant, retail and pharmacy workers.

In a decision released today, the FWC found that existing Sunday penalty rates in the four industries "do not achieve the modern awards objective" and they overcompensate employees for Sunday work.

"Given this conclusion, we are not satisfied that it is appropriate to impose any further delay in the implementation of our decision," said the commission's full bench.

The FWC also acknowledged cutting Sunday rates on July 1 meant employees would only have had four months notice.

"In these circumstances, it is appropriate that the first step in the transition be smaller than subsequent steps," it said.

The FWC ruled that for full-time and part-time workers in the retail and pharmacy sectors, Sunday penalty rates cuts from 200% to 150% will be staggered until 2020.

Moreover, fast-food employees will have their 150% Sunday rates cut over the next three years until 2019.

While hospitality workers' Sunday pay will gradually fall from 175% to 150% over the next three years.

Labor Leader Bill Shorten said that regardless of when the rates come into effect, the decision "confirmed the worst fears of workers".

"This is an appalling decision and comes at a time when wages are falling in real terms," said Shorten.

"It doesn't matter if the cuts are phased in over two or three years, the damage is the same – people will be losing real money.



 

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