Business Franchise Australia


Retailers Caught in The Penalty Rate Yo-Yo

Retailers Caught in The Penalty Rate Yo-Yo

Over 350,000 casual retail employees will now receive an increased penalty rate for Saturday work as announced by Fair Work President Justice Iain Ross on the 1st October 2018.

The first rate increase is 15 per cent from 1 November 2018; with the rates going up 5 per cent annually until March 2020.

According to Senior Employment Relations Adviser Alexandra Woods from Australia’s largest workplace relations firm Employsure, representing close to 20,000 small and medium sized businesses, the increased penalty rates are causing frustration and confusion for small business retailers that are constantly being hit with changes.

“Small business employers are feeling the pinch during the peak season and increasing consumer demand for longer operating hours before Christmas,” he said.

Woods adds, “Many retailers by now have already planned rosters and hired casuals before the busy wave of Christmas. Now, with this decision introduced, retailers are going to have to rethink their rostering arrangements and budgets.”

In addition to the increased rates for casuals, shift workers penalty rates on Sunday for permanent reduced from 200 per cent to 175 per cent and from 225 per cent to 200 per cent for casual shift workers

Having witnessed many small businesses frustrated by the repeated penalty rate changes Woods said: “We speak to thousands of small business owners every week who would like to see government stop making frequent changes to penalty rates and get serious about supporting small business.”

In 2017, the Fair Work Commission cut retail casuals’ Sunday rates to 175 per cent from 200 per cent, to be phased in by July 2019. Then earlier this year, retail employers were required to increase penalty rates for public holiday and Sunday work.

Woods encourages employers to start getting prepared. “It’s so important to be across these changes now ahead of your busiest period. Check if the new penalty rates changes apply to your business before 1 November 2018. Get the right advice to avoid paying the expensive price of getting it wrong.”