Release type: Media Release


Fair Work Commission transitional arrangements for Sunday penalty rates


Senator the Hon Michaelia Cash
Minister for Employment
Minister for Women
Minister Assisting the Prime Minister for the Public Service
Senator for Western Australia

The independent Fair Work Commission today released its decision on transitional arrangements that will apply to its recent decision on penalty rates.

Changes to Sunday rates will be phased in as follows:

  •  over three annual instalments from 1 July 2017 for workers under the Fast Food and Hospitality awards and casual workers under the Retail award; and
  •  over four annual instalments from 1 July 2017 for workers under the Pharmacy award, and for full-time and part-time workers under the Retail award.

The adjustments to Sunday penalty rates will even the playing field for Australia’s small businesses, which have to pay more for staff on Sundays than big businesses who do deals with big unions. This will help thousands of small businesses open their doors, serve customers and create jobs on Sundays.

Throughout this process the Fair Work Commission has cited many examples of small business owners who work on Sundays for free, but would rather hire staff, or businesses that would provide services on Sundays but cannot because of penalty rate levels.

For example, for permanent full-time and part-time staff on Sundays:

  • A bed and breakfast must pay $10 an hour more than a 5-star hotel; 

  • A family chicken shop must pay $8 an hour more than KFC;

  • A family-owned takeaway must pay $8 an hour more than McDonalds;

  • A family pizza takeaway must pay $8 an hour more than Pizza Hut;

  • A family greengrocer must pay $5 an hour more than Woolworths;

It is important to note that the Commission’s decision does not affect all workers - it affects 3-4% of Australia’s workforce. It is a direct consequence of the review process put in place by Bill Shorten as Workplace Relations Minister in the previous Labor government in 2013.

This is not the first time penalty rates have been modified.

Under Labor, penalty rates were cut in certain awards (including hotel, cafe and restaurant workers) in 2010 as part of Labor’s award modernisation process. In 2014, Sunday penalty rates for certain workers on the Restaurant award were reduced under the two-yearly review of modern awards, yet Labor did not conduct a dishonest political campaign against these changes.

The Turnbull Government’s position has remained consistent. In the same way interest rate decisions are determined by the independent Reserve Bank, the setting of award wages and conditions are a matter for the independent Fair Work Commission to determine, not the Government.

On the issue of penalty rates, Labor could not be more hypocritical.

As a union boss, Bill Shorten cut deals to lower penalty rates – including in the retail and hospitality industries (for workers at Big W, Target, Just Jeans, Rydges) – by the same rate the Fair Work Commission is now applying for workers on the relevant awards.

Bill Shorten stripped all penalty rates for low paid cleaners working at Cleanevent, with no compensation, while his union accepted payments from the company.

Bill Shorten has no problem with reducing penalty rates when he himself does it, and when his union mates do it in deals with big businesses. He only objects when an independent umpire does the same thing for small business.

It is time for Bill Shorten and the Labor Party to end their hypocritical stunts on penalty rates.