Penalty rates decision to be phased in

The Fair Work Commission has announced transitional arrangements for implementing the recent decisions to reduce penalty rates for work on Sundays and Public Holidays across a variety of awards.

Sunday penalty rates

The reductions in Sunday penalty rates are being phased in in annual instalments over 3 to 4 years depending on the award and are timed to occur on 1 July at the same time as any increases in award wages occurring from the Annual Wage Review process. The schedule for each award is as follows.

Fast Food Industry Award 2010

Full-time and part-time employees – Level 1 only

1 July 2017: 150 per cent > 145 per cent

1 July 2018: 145 per cent >135 per cent

1 July 2019: 135 per cent >125 per cent

Casual employees (inclusive of casual loading) – Level 1 only

1 July 2017: 175 per cent > 170 per cent

1 July 2018: 170 per cent > 160 per cent

1 July 2019: 160 per cent > 150 per cent

Hospitality Industry (General) Award 2010

Full-time and part-time employees

1 July 2017: 175 per cent > 170 per cent

1 July 2018: 170 per cent > 160 per cent

1 July 2019: 160 per cent > 150 per cent

Casual employees – unchanged at 175% including casual loading

General Retail Industry Award 2010

Full-time and part-time employees

1 July 2017: 200 per cent > 195 per cent

1 July 2018: 195 per cent > 180 per cent

1 July 2019: 180 per cent > 165 per cent

1 July 2020: 165 per cent > 150 per cent

Casual employees (inclusive of casual loading)

1 July 2017: 200 per cent > 195 per cent

1 July 2018: 195 per cent > 185 per cent

1 July 2019: 185 per cent > 175 per cent

Pharmacy Industry Award 2010

Full-time and part-time employees

1 July 2017: 200 per cent > 195 per cent

1 July 2018: 195 per cent > 180 per cent

1 July 2019: 180 per cent > 165 per cent

1 July 2020: 165 per cent > 150 per cent

Casual employees (inclusive of casual loading)

1 July 2017: 225 per cent > 220 per cent

1 July 2018: 220 per cent > 205 per cent

1 July 2019: 205 per cent > 190 per cent

1 July 2020: 190 per cent > 175 per cent

Public Holiday penalty rates

This decision effects the above 4 awards plus the Restaurant Industry Award 2010.

In all of these awards , the penalty rate for work on a public holiday is changed with effected from 1 July 2017 to

Full-time/part-time:  225%

Casual:  250%

One of the reasons given for phasing in the Sunday penalty rate cuts over such a prolonged period was that “take home pay” orders would not be an available option for workers whose take home pay was reduced as a result of implementation of this decision. The FWC’s rationale is that annual wage increases will significantly, if not totally, offset reductions in penalty rates.

This is likely to be a factor in future Annual Wage Reviews.

It is understood that some unions may seek judicial review of the penalty rates decision and, should that occur, it is possible that implementation could be further delayed.