In a landmark ruling handed down on 23 February 2016, the Fair Work Commission (FWC) reduced Sunday penalty rates in the hospitality, retail, fast food and pharmacy sectors and pared-back public holiday penalties in five awards. Public Holiday penalty rates in five of the six awards in the case will also be reduced.

FWC refused to cut Sunday penalties in the restaurant and clubs awards, finding the employers had failed to establish a merits case.

This is one of the most contentious decisions to be made in the IR space in a many years and will naturally face significant push back. At some stage, the legislation must catch up with the times. We live in a 24/7 society which is driven by technological changes enabling constant access to services.

Yes, I am of the generation who remembers the shops closing at 12pm on a Saturday and not opening again until Monday. If you forgot to buy something – too bad! Now we have the convenience of shopping, accessing fast food and chemists 7 days per week. As consumers, we don’t expect to pay more for the same services we receive on a Sunday, yet business owners must pay twice as much for the labour to provide the service.

So, as all the negatives are highlighted, we also need to stop and think that maybe businesses that could not afford to trade on a Sunday will now open. Those operating on minimal staff will have the opportunity to hire more people. Increased revenue leads to increased employment. Therefore, it is not all doom and gloom and a sensible way to move forward in our ever-changing world.

Here is a quick summary of the proposed changes to penalty rates.

Hospitality Award
Full-time and part-time employees:
(no change for casuals)
175% to 150%
Fast Food Award 
(Level 1 employees only)
full-time and part-time employees:
casual employees:
150% to 125%
175 % to 150 %
Retail Award
full-time and part-time employees:
casual employees:
200% to 150%
200% to 175%
Pharmacy Award
(7.00 am – 9.00 pm only)
full-time and part-time employees:
casual employees:
200% to 150%
200% to 175%

The Full Bench determined that public holiday penalty rates be reduced (except in the Clubs Award) as follows:

Award Permanent Casual
Hospitality Award 250 to 225% 275 to 250%
Restaurant Award 250 to 225% 250%
Clubs Award 250% 250%
Retail Award 250 to 225% 275/250 to 250%
Fast Food Award 250 to 225% 275 to 250%
Pharmacy Award 250 to 225% 275 to 250%

Larosh HR works with businesses to ensure they are meeting all their legislative requirements without making it onerous. If you are unsure of what you should be paying your employees, visit our website (www.larosh.com.au) and get in touch with us.