Fair Work cuts penalty rates for hospitality workers

The Fair Work Commission (FWC) has ruled Sunday and public holiday penalty rates for hospitality workers will be reduced.

The decision by FWC on 23 February states that cuts would lead to “increased services and trading hours on public holidays and Sundays” and “greater consistency in penalty rate settings in the Hospitality and Retail Awards”.

As a result, hospitality full-time and part-time workers will have their Sunday penalty rates cut from 175 per cent of their standard wage to 150 per cent. Casual rates in hospitality will remain the same for Sunday positions.

The Full Bench also reduced public holiday penalty rates of full-time and part-time hospitality awards from 250 to 225, and casual workers from 275 to 250.

FWC’s decision will also impact workers in retail, fast food and pharmacy sectors.

The decision comes as part of FWC’s four yearly review of modern awards under s.156 of the Fair Work Act 2009. However, cuts could see a loss of up to $6000 per year for some workers.

“The Fair Work Commission’s (FWC) decision to radically cut Sunday and public holiday pay will give almost one million Australian workers a huge pay cut,” said Australian Council of Trade Unions (ACTU) President Ged Kearney in a statement.

Some employer groups have encouraged the move. The Victorian Chamber of Commerce and Industry Executive Policy Director of Policy and Advocacy Bryce Prosser said the decision was a relief for many businesses who had cut operating hours on Sunday in previous years.

“Small retail and hospitality businesses in regional Victoria will benefit significantly from this decision,” Bryce said in a statement.

“Adjusting the penalty rates on Sundays will now allow businesses to stay open for longer on Sundays and public holidays and be fully staffed.

“At the end of the day, businesses and their employees want the same thing, to have a thriving workplace that can operate with certainty and reward workers.”

The public holiday penalty cuts will come into effect on 1 July 2017. The FWC is yet to set a date as to when the Sunday rate will come into effect.

For more information on how the penalty cuts will impact your business, click here.

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