Monday Night Q & A: Penalty Rates

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Satyajeet Marar, Member of the MACQ Liberal Club

We can all agree that weekend penalty rates have become an important part of many industries. The 8 hour, 5 day standard work week has become parcel of working life in our great land. There is no reason why people giving up parts of their weekend to provide us with essentials such as emergency health care and psuedo-essentials such as poolside clubbing (I jest, I jest) should not be compensated for sacrificing something those of us in other industries take for granted.

But also consider this – half of Australia’s restaurants, cafes and bars remain closed on Sunday due to high costs under the current regime of double penalty rates on a Sunday as opposed to 1.5x on Saturday. This doesn’t just hurt our businesses and our tourism sector – it also hurts many workers who end up with fewer hours and ironically, a thinner paycheck in the long run. It also means denial of opportunity to struggling job seekers willing to work these days, given the chance. There’s a lot more to it than lower costs for us consumers.

Seeing some of my favourite hangouts close down from no longer being able to afford this city’s exorbitant rents and seeing friends lose their bar jobs in the process only adds chilli flakes to the proverbial frustration kebab. Lowering the cost of operating our small businesses is now more crucial than ever. Problems also plague our retail sector where businesses paying penalty rates have been hit hard by falling consumer confidence and a move toward online retailers. These include foreign companies and many enjoy a cost advantage from not employing front-of-house staff.

That’s why I’ll invite you to consider this – let’s keep our penalty rates but let’s have a single weekend penalty rate of 1.5x the weekday wage. Let’s even make an exception for our emergency services. Not only does this make solid economic and employment market sense, It also makes common sense and moral sense – in what way is working on a Saturday 133% harder than working on a Sunday? I doubt that even Jesus or his dad would be that bothered by someone working on the sabbath any more – they’ve probably got bigger fish to fry.

As an example, retailer Jeanswest has already estimated the change would allow them to open additional stores, employing more staff whilst creating up to 30,000 extra labour hours a year. Whilst individual retailers may have vested interest in lobbying for the change, business models across the industry support the notion that the money saved would be reinvested in labour. Hospitality and retail businesses remaining open on Sundays usually employ staff in single areas such as sales rather than administration tasks or employ staff in limited or peak hours to cover the cost of having to pay them so much more than their Saturday wage. Our ‘Sunday economy’ is in a sorry state and it really doesn’t have to be when it could be employing so many more people or giving them more lucrative shifts.

* – The Young Liberal movement of NSW and Macq Liberal club oppose the NSW government’s current lockout laws. A government review is currently underway and the laws are under scrutiny with findings/recommendations due to come out late

Brittany Freckelton, MQU Labor Treasurer

My favourite thing about Federal Parliament is how it sits on weekends. How valiant of politicians to enable us to get our weekend dosage of democratic latte’s and constitutional acai smoothie bowls.

If only that were true.

If we are to believe what Malcolm Turnbull says, that the Australian economy exists in a never-ending, never-slowing, 24/7 fairyland, then perhaps we should sell our children to the market and get on with our infinite servitude.

“Penalty rates have been a part of Australia’s social and economic fabric for more than 100 years. As a nation, we’ve said that [when] working outside regular hours, employers must compensate workers for unsociable hours.” (The Age, April 2015).

We do not live to work, and periods of rest such as public holidays and weekends are crucial opportunities to spend time with friends and family and to recoup both mentally and physically for the following work week.

Whilst Turnbull claims lowering penalty rates is a predestined conclusion of a seven-day economy, the reality is that 4.5 million Australian’s rely on the additional over-time pay to put a roof over their heads and food on the table. Penalty rates are not a luxury, as the Coalition may claim, but rather a safety net for those members of society who can only work unsocial hours.

For hospitality workers, about half are casuals, more than half are women and almost one-third are students. I fit into all three of these categories. I also have been financially independent since I was 15, when I got my first job. I work every weekend so that I can afford to go to university, buy the necessary resources associated with studying and travelling, and make reasonable dietary choices. This means missing out on time to spend catching up with old friends or seeing my family. Lower income earners, with less job mobility than those better off are expected to work weekends so that businesses can open and other members of society can enjoy products and services on their days off, and as a result, they should be fairly compensated

But don’t let the Tories have you believe that penalty rates are a burden on business. To suggest that penalty rates hurt the economy is a fallacy. Penalty rates translate to more disposable income for workers who earn on the lower end of the scale. Lower income earners typically spend more of their disposable income week to week, and as a result, additional wage is almost immediately entered back into the economy and businesses benefit. When we take into account consumption taxes such as the GST, the economy is in fact better off, and better still… FAIRER!

Penalty rates and fair wages are a defining element of our Australian economy and way of life. We as a populace have to remain determined to protect award wages and fair compensation. Join your union.