Welcome to Eureka Street

back to site

AUSTRALIA

Swift injustice in modest penalty rates proposal

  • 02 March 2017
  The Fair Work Commission decision on penalty rates removes any doubt that young people might have still had about their place in the economic order.

The four-yearly review of awards in hospitality, fast food, retail and pharmacy found that Sunday penalty rates 'do not achieve the modern awards objective, as they do not provide a fair and relevant minimum safety net'. But whose safety net? Unfair to whom?

These industries are already notorious for exploiting young workers, with numerous cases of routine underpayment and unpaid 'work trials'. Workers are particularly vulnerable in regional areas with high levels of youth unemployment; the alternative to being underpaid is not having a job at all.

Some are managing time between work and study. Most do not have union membership. The scale of precarity is significant: one in four young Australians, for instance, are employed in the retail industry.

In a piece on millennial labour conditions, Sonia Nair points out that hers is the first generation that will have earned earned less over a lifetime than previous cohorts. Educational attainment no longer relates to economic mobility. Paid work has become precarious and precious — insecure and hard to find.

According to the 2014 Australian Work and Life Index, nearly 40 per cent of young people depend on penalty rates as part of their wage. The study also concluded that in a broad cross-section of the working population, 'the choice to work unsocial hours is driven largely by the financial incentive of penalty rates'.

The imperative is so strong that around 70 per cent of employees would not work unsocial hours if penalty rates were not offered. It suggests that working on Sundays is not a matter of lifestyle. In low-wage industries, it is how young people can make up for earnings that they don't receive when they are at university, doing care work or aren't rostered enough as casuals.

The looming cuts to take-home pay vary between industries and employment type (full-time, part-time and casual). A McDonald's counter worker could lose $22.50 from her six-hour Sunday shift. A retail worker could lose as much as $72 from a seven-hour Sunday shift. In cities where young people are also experiencing housing stress, such wage loss could tip someone out on the street.

 

"In siding with employers, the Commission demonstrates wilful disregard for some of most vulnerable workers in favour of a wealth transfer for business owners."

 

Remarkably, the FWC acknowledges the impact on award-reliant

Join the conversation. Sign up for our free weekly newsletter  Subscribe