Labor’s penalty pledge won’t mean back-pay

canberra, parliament house, politics, governmentBill Shorten has vowed to restore the Sunday penalty rates of every worker affected by the July 1 cuts.

Hundreds of thousands of Australia’s lowest paid workers in the hospital, retail and fast food industries will start to see their weekend penalty rates cut from next week, under a decision of the independent Fair Work Commission.

The opposition leader told an ACTU conference in Sydney on Tuesday a Labor government would change the law to protect the take-home pay of workers.

“I promise you this: a new Labor government will restore the Sunday penalty rates of every single worker affected by this cut,” Shorten said.

Shorten contrasted the cut with the tax break to be given by the Turnbull government to the highest income earners from July 1, following the axing of the “deficit levy”.

The government argues the penalty rates decision was made independently and the minimum wage is due to rise by 3.3 per cent on July 1.

Labor’s pledge to restore Sunday penalty rates at the next election won’t mean back-pay, it has acknowledged.

But it will lock in the rates which will be reduced in some sectors from Saturday.

Labor’s employment spokesman Brendan O’Connor says the party will continue to fight when parliament resumes in August for the decision to be reversed.

It would also take a policy to protect the take-home pay of workers to the next election.

But O’Connor concedes back-pay for the reductions already in place by then would be impossible and too disruptive.

“This won’t be retrospective in relation to payment but it will restore the rates as they were on the 30th of June 2017,” he told ABC radio on Wednesday.

The Council of Small Business Australia described Labor’s pledge as a vote of no-confidence in the Fair Work Commission.

“The Fair Work Commission’s made one decision which they don’t like and they’re going to undo it,” it’s CEO Peter Strong said.

“I think this is disgraceful.”

Meanwhile, the Australian Retailers Association (ARA) has strongly opposed the Shop, Distributive & Allied Employees Association application for a judicial review of the penalty rates decision.

“Retailers are already operating in an extremely difficult environment, and now with the 3.3 per cent increase to minimum wage, a reversal of the Penalty Rates Decision would eradicate the benefits to both employers and employees working in this sector,” said Russell Zimmerman, ARA executive director.

“Our concern is that that retailers have to work within a wages budget and if this reduction is reversed, some retailers will have to reduce employee hours, and in some cases, reduce their staff.”

The ARA believes the Commission’s decision will be upheld in the Federal Court.

“The Commission found that a reduction in Sunday and Public Holiday penalty rates will allow retailers to extend trading hours, giving staff more hours to work and increase employment across the board,” Zimmerman said.

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