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Politics

Penalty plays

Employers are lobbying for penalty rates to be reduced. Again.

When the Australian Industry Group’s chief executive, Innes Willox, was interviewed recently by the Australian, he claimed that, whenever penalty rates are mentioned, the ‘unions love to talk about nurses and firemen’, whereas the current debate is about penalty rates in the retail, fast food and restaurant industries.

He suggested that these rates could be reduced if weekend and public holiday shifts were assigned to juniors – at weekday, rather than penalty, rates of pay.

Many young people are unable to work during the week, he said, ‘because of study commitments’, but they would be happy to work at weekends and on public holidays ‘at the rate of pay which applies on weekdays’.

Increasingly, adult and junior workers in the fast food, retail and restaurant sectors are engaged as casuals. Their pay includes a 25 per cent loading because, unlike permanent staff, they are not entitled to paid sick leave or holiday pay.

The Fair Work Commission advises on its website that junior casuals in these industries, aged 16 or under, receive a weekday pay rate of about $10 an hour. This rises, incrementally, to a top weekday rate of about $22 an hour for 20-year-olds.

As Innes Willox points out, these weekday rates are well below the Fair Work Commission’s penalty rates for adult workers in the same industries. Adult shop assistants are paid a casual rate of $52.16 an hour on public holidays and $37.93 on Sundays. Their weekday rate, however, is only $23.71 an hour. They get slightly more on Saturdays: $25.60 an hour.

But then many adult workers in the retail, restaurant and fast food industries are now employed as part time casuals, for about 20 hours a week. So their weekly take home pay, after tax and other deductions, is unlikely to be more than $600, even if their week’s roster includes a Saturday, a Sunday and a public holiday.

Meanwhile, the costs of getting to and from work are much the same whether you work part time or full time

So is it reasonable to protest at penalty rates for, say, restaurant workers who leave their homes and families to serve us on Christmas Day, Mothers’ Day and other holidays? In any case, don’t many restaurants impose holiday surcharges to offset penalty rates?

A recent Roy Morgan survey revealed that, while Australia now has a workforce of about 12.2 million, over two million of those workers are either unemployed or under-employed and seeking more hours. The ranks of under-employed job seekers are likely to increase if, as the Australian Industry Group proposes, more school kids take over the weekend and public holiday shifts.

A couple of years ago the Australian Council of Trade Unions commissioned an Independent Inquiry into Insecure Work. It was chaired by a former Labor deputy prime minister, Brian Howe and submissions were posted on the web.

The inquiry found that 40 per cent of Australia’s workers were employed on contracts or as casuals or sub-contractors. The National Tertiary Education Union reported that 60 per cent of all university academic staff were being engaged on ten month contracts that left them without pay over the December/February university holidays. In many cases, these academics were reportedly also left in limbo for weeks, waiting to hear if they would be re-engaged.

School teachers, even those employed in remote areas, had similar complaints. Workers in the factory and call centre sectors were worse off – they reported that they often didn’t know from one day to another if they would be rostered for the next shift.

The Australian Council of Social Services and Mission Australia was among the welfare organisations that posted submissions about the ramifications of insecure work. It argued:

  • The banks don’t normally offer mortgages to workplace casuals or sub-contractors. So they are forced to meet the even higher costs of renting accommodation.
  • Casuals can be legally dismissed, without compensation, at five minutes’ notice. Some workers admitted in submissions to the inquiry that, rather than risk jeopardising their jobs, they turned a blind eye to workplace safety matters, fraud and bullying.
  • Casuals are not entitled to paid public holidays. So if they fail to get a shift over Christmas or Easter, they can be out of work for up to four days. The inquiry found that many casuals had not had a paid annual holiday in years. Many can’t even afford to take a day off to attend a funeral or pay for medicines or dental treatment. Single parents can find themselves forced to decide whether to stay home to care for an off-colour school child, or go to work so they can continue to pay the rent and put food on the table.

It was hoped that inquiry’s shock revelations would become an issue at Australia’s 2013 general election. That didn’t happen – and matters have not improved. The ACTU’s media office reports that 40 per cent of Australians continue to work in insecure jobs. The ACTU also complains that amendments to the 457 visa scheme have made it easier for employers to import overseas workers while Australian employers export jobs overseas.

The Fair Work Commission’s website includes reports of cases involving the exploitation of both 457 visa holders and local workers who are not familiar with Australia’s industrial legislation. Meantime, ACTU president, Ged Kearney, has been dispatching emails to workers to warn them that the Abbott Government’s Fair Work Amendment Bill will soon go before the Senate. She claims it is intended to ‘strip away protection around individual contracts and make it easier for employers to force workers to give up their penalty rates.’

Australia was once internationally regarded as a workers’, rather than an employers’ paradise. Forty years ago the vast majority of workers had permanent jobs, with benefits that included a paid three week holiday, paid sick leave and long service leave and penalty rates for overtime and casual staff.

Now we’re told that, in prosperous Australia, public holiday penalty rates, even for public holidays, are unsustainable because we must compete in the ‘global economy’. Yet this competition has benefitted only the top cats, including multi-national corporations, some of which pay only a tiny fraction of their massive profits in tax.

For many working people, here in Australia and in the USA and elsewhere, deregulation has resulted in unemployment and under-employment, family violence and breakdown, impaired health and (as rents rise) the fear of homelessness.

Overland is a not-for-profit magazine with a proud history of supporting writers, and publishing ideas and voices often excluded from other places.

If you like this piece, or support Overland’s work in general, please subscribe or donate.

Ava Hubble is an author and former columnist and reporter, now working as a freelance writer.

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Comments

  1. B-b-b-but what about the business owner!

    The benefits to casual staff far outweighs the bottom line of any company. But that is a moralistic approach and will be ignored.

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