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How will your business be impacted by the reduction in penalty rates?

The Fair Work Commission have reduced penalty rates
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How will your business be impacted by the reduction in penalty rates?

How will your business be impacted by the reduction in penalty rates?

23 February 2017

The decision effectively:

 
(a) reduces Sunday penalty rates in the retail industry from 200% to 150% (for permanent staff) and from 200% to 175% (for casuals);
(b) reduces Sunday penalty rates in the hospitality industry from 175% to 150% (for permanent staff       only);
(c)  reduces Sunday penalty rates in the fast food industry (Level 1 only) from 150% to 125% (for                     permanent staff) and 175% to 150% (for casual staff);

(d)  reduces Sunday penalty rates in the pharmacy industry (7am-9pm only) from 200% to 150% for               permanents and from 200% to 175% for casuals; and
(e)  reduces public holiday penalty rates as follows:
(i)   in the Hospitality Award from 250% to 225% for permanent employees and from 275% to 250%                 for casuals;
(ii)  in the Restaurant Award from 250% to 225% for permanent employees;
(iii) in the Retail Award from 250% to 225% for permanent employees and to 250% for casuals;
(iv) in the Fast Food Award from 250% to 225% for permanent employees and from 275% to 250% for           casuals; and
(v)  in the Pharmacy Award from 250% to 225% for permanent employees and from 275% to 250% for           casuals.

The Decision will also vary early/late night loadings in Restaurant and Fast Food Awards.
The decision marks the resolution of an enormous industrial proceeding which ran for 39 hearing days and featured over 140 witnesses including 10 expert witnesses. The public were also invited to provide feedback during the course of the proceedings, a process which resulted in almost 6000 further submissions. The written decision itself comprises of 551 pages.

The decision also represents the culmination of more than two years of work of Australian Business Lawyers & Advisors (ABLA) representing the NSW Business Chamber and Australian Business Industrial in relation to the retail industry and restaurant industry.

In taking a lead role in the employer case, ABLA presented expert academic evidence concerning the value employees place on public holidays and weekends, provided direct survey evidence as well as cross-examined union witnesses.

How the Changes will be implemented

The Full Bench has not reached a concluded view on how the changes are to be implemented.
It has indicated that its provisional view is:

  1. The Public holiday changes will take effect from 1 July 2017;

  2. The variation to the early/late night loadings in Restaurant and Fast Food Awards will take effect in late March 2017;

  3. The variations to the Sunday penalty rates will take be phased in by a series of annual adjustments taking place on 1 July each year. The Full Bench has indicated that this process will involve at least 2 adjustments, but less than 5.

Workplace Assured will be issuing further information on the ramifications of the judgment as well as updating relevant awards and pay summaries as the changes are brought in.
 
If you would like to speak to a workplace relations expert to see how these changes will impact your business, call our Free Advice Line on 1300 496 955.
 

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