The employment safety net comprises Fair Work Act minimum standards (eg annual leave) and industrial award minimum pay and conditions in various industries and occupations. When the new award system commenced in 2010 (under the previous government) an inbuilt check was the requirement for the independent industrial umpire, the Fair Work Commission (FWC), to conduct a 4 yearly review to ensure awards continued to provide a fair and relevant minimum safety net.
Some changes have been non contentious, eg annual leave cashing out. But as part of the review, employer groups applied to vary penalty rates in some awards where Sunday work is significant. The FWC heard evidence and submissions on the issue over 39 days from 143 witnesses with over 5,900 written submissions. In making its decision, the FWC said the “disutility” for employees working on Sunday in these industries was higher than on Saturday, although less than it used to be, and concluded that deterrence was no longer a relevant consideration in setting weekend and public holiday penalty rates. It decided that Sunday penalties will drop:
• In hospitality from 175% (time and three quarter) to 150% (time and a half) for full time/part time employees but won’t change for casuals;
• In retail from 200% (double time) to 150% for full time/part time employees and from 200% to 175% for casuals;
• In fast food from 150% to 125% for level 1 full time/part time employees and from 175% to 150% for casuals; and
• In pharmacies from 200% to 150% for full time/part time employees and from 200% to 175% for casuals.
The FWC made similar cuts to public holiday penalty rates. Saturday penalty rates have not changed. The FWC is considering transitional arrangements to phase in these changes. The FWC pointed out that its decision was largely based on the particular circumstances of the awards being considered and there was no warrant for variation of penalty rates in other modern awards. The changes won’t affect current enterprise agreements nor contract over award rate agreements. The detailed decision and a summary can be accessed at FWC Decision. We can help with advice about the detail and implications of these changes for your workplace.