The Commission found that penalty and overtime rates should be maintained overall, though regulated minimum Sunday rates should be aligned with Saturday rates for the group of industries that particularly provide weekend services – cafés, hospitality/entertainment, restaurants and retailing.
The report states that this would be a floor to the penalty rate, and employers may decide to pay more if they find it hard to attract employees on Sundays.
Retail Council CEO Anna McPhee says the draft recommendations provide a solid foundation to enable a mature and much-needed discussion about reforming the workplace relations framework to meet the needs of the modern economy.
“The draft report recognises there is capacity for businesses to create more jobs if the right balance is struck,” she said. “As a sector that employs more than 1.25 million Australians, the rebalancing of penalty rates to reflect the needs of the modern economy will mean retailers can create jobs to meet increased consumer demand, which in turn will benefit the economy more broadly.”
The draft report showed the share of Saturday and Sunday retail sales over the past 30 years had converged over time. For many, Sunday trading is now the norm, and retailers have reported Sunday trading now accounts for between 10 per cent and 35 per cent of weekly sales.
Ms McPhee says these extended hours have created new jobs in the retail sector for young people, women and seniors and others who want to work part-time.
“Research conducted by the Retail Council suggests a significant proportion of retail employees are willing to work in the evening, over weekend and on public holidays,” she said. “This suggests the balance between retailers’ need for workers and employees’ collective willingness to work could warrant an adjustment to penalty rates from where they are currently set.”
Australian Retailers Association Executive Director Russell Zimmerman says penalty rates must be reduced to support further retail growth.
“The ARA is pleased to see the Productivity Commission has opened up discussion on penalty rates,” he said. “The ARA, along with a group of retailers, is already engaged in a review of the General Retail Industry Award 2010 with the view to reducing costs for retailers who trade on Sundays.”
The ARA is arguing for a reduction in Sunday penalty rates from 100 per cent, known as double time, to 50 per cent, or time and a half, for retail workers.
“We fully support the recommendations of the Productivity Commission’s report and look forward to working with the Government to implement these reforms,” Mr Zimmerman said.
The National Retail Association also backed the recommendations of the Productivity Commission’s inquiry into workplace relations laws, and called on the Abbott Government to adopt the proposed changes.
NRA CEO Trevor Evans said the recommendations around varying penalty rates in the retail sector would lead to a “jobs bonanza” across the nation, and he called on the Government to get on with the job.
“Whenever we talk with members about trading conditions, they almost always raise the issue of labour costs on Sundays and public holidays,” he said. “We can say with certainty there are many thousands of businesses across Australia whose customers want them to open [on Sundays and public holidays], but whose owners simply can’t afford to pay staff on those days.”
Mr Evans says the NRA is not arguing for the abolition of penalty rates, and that anyone who attempts to characterise this debate as an attack on workers simply fails to understand that what a worker needs more than anything else is a job.
“We support sensible reform that applies a more realistic penalty rate for Sundays and public holidays, ensuring businesses will open and there will be increased job opportunities,” he said.